Secular Stagnation: Fear of a Non-Reproductive Future

Melinda Cooper (bio)
University of Sydney

Abstract

In the wake of the global financial crisis, a number of high profile economists have sought to revive Alvin Hansen’s Depression-era theory of “secular stagnation” to account for the stagnant tendencies in the American economy, citing Japan as a cautionary tale of combined demographic and economic decline. Following Hansen, it is argued that the long-term stagnation of the world economy can be attributed to a failure of the reproductive will, made manifest in declining birth rates and ageing populations. Although the causal connections between population and price trends are controversial even among mainstream demographers and economists, such arguments date back to the origins of political economy and appear to magically resurface with each major episode of crisis. If the crisis is inflationary, it tends to be ascribed to overpopulation; if it is deflationary, we find a corresponding concern with slowing birth rates. This article seeks to understand the durability of the demographic theory of crisis by examining the punitive and restorative work it performs in periods of capitalist restructuring.

For many years, Japan has served as a cautionary tale to other debt-fueled economies around the world. The debt-deflationary spiral that engulfed the Japanese economy in the 1990s was for a long time seen as exceptional, attributed to some deep fault-line in its historical development or some intrinsic weirdness of the Japanese national character. Following the wave of competitive and envious commentary that flourished in the American business press of the 1980s, the case of Japan’s protracted downturn after 1990 was variously analysed with schadenfreude or bemused curiosity, and understood as the consequence of uniquely Japanese perversions. The Japanese state had been too paternalistic all along. Its people had been infantilized by lifelong job security and indulgent government spending. Once feared as mindlessly over-productive, Japanese workers were now dismissed as obsessively deferential, over-regimented, and robotic.

In both the Japanese and American literature, commentary on Japan’s so-called Lost Decade very quickly became inseparable from a reflection on the peculiar demographic trends affecting the country. Relative to the post-war years of accelerated demographic growth, the Japanese population is rapidly aging and declining, combining some of the lowest birth rates in the world with unusually long life expectancy. Japanese women today are less likely to marry than in the recent past and are having fewer children. The secondary literature on the Japanese economic situation has very rapidly conflated these two phenomena of economic stagnation and slowing population growth. Perhaps stagnation was exacerbated or even caused by falling birth rates? Perhaps this signalled a deeper malaise in the reproductive life of the nation, a literal failure to reproduce the future? Or a mortgaging of the future via the burden of unsustainable public debt? Michael Zielenziger’s Shutting Out the Sun: How Japan Created its Own Lost Generation, an early and influential example of this genre, reflects that “the most ominous aspect of Japan’s stagnation” is the pervasive crisis of confidence that has affected its people. This distress, he confidently asserts, “is reflected in Japan’s plummeting birthrate,” which is in turn made manifest in various diversions from reproductive sexuality, ranging from womb-striking women to infantilized adolescent men who never leave home and shun the active role in sex (9). The conundrum of economic stagnation has generated a seemingly inexhaustible literature on the failures of reproductive sex in contemporary Japan,¹ and inversely, a triumphant literature on America’s comparative success in maintaining both vigorous birth rates and a dynamic economy.

But while this narrative has not diminished in recent years, the certainty that it is somehow unique to Japan has retreated. The protracted stagnation that has beset the American economy in the wake of the global financial crisis – despite several rounds of Quantitative Easing and near-zero interest rates – has compelled even mainstream American economists to ask the unthinkable. Is America becoming the next Japan? Is it conceivable that America might be following Japan, not only down the pathway toward economic stagnation but also toward some deeper demographic malaise that could see population growth falter in the years ahead? Although certainly not dramatic when compared to either Japan or Western Europe, recent figures suggest that the population growth rate in America has slowed down somewhat. Reflecting on this trend, the New York Times journalist Ross Douthat ventures that America has perhaps “lost its demographic edge” (“More Babies”). Beyond economic drivers, perhaps the deeper structural cause behind America’s protracted downturn and anemic growth rates can be found in a “broader cultural shift away from a child-centric understanding of romance and marriage” (“More Babies”). And as if to underscore that orientalist theories of non-Western perversion have always been linked, mirror-like, to fears of Western decadence, he goes on to accuse America of exporting this particular form of reproductive failure to the rest of world: “The retreat from child rearing is, at some level, a symptom of late-modern exhaustion – a decadence that first arose in the West but now haunts rich societies around the globe. It’s a spirit that privileges the present over the future, chooses stagnation over innovation, prefers what already exists over what might be” (“More Babies”). In short, the cause of America’s economic stagnation is ultimately to be found in a failure of reproductive sex.

In the wake of the global financial crisis, this largely journalistic literature on population decline has achieved a certain academic respectability thanks to the revival of demographic theories of crisis popular in the 1930s. In a 2013 speech delivered at the International Monetary Fund (IMF), former Treasury Secretary Lawrence Summers suggested that America’s protracted economic slump could be explained by Alvin Hansen’s long forgotten theory of “secular stagnation,” which attributed America’s Depression-era woes to a dramatic drop in the birth rate (Summers, “Economic Forum”).² Writing in the late 1930s, at a moment when America was plunging back into an unexpected recession, Hansen sought to theorize why the American economy continued to post such disappointing growth rates some ten years after the Wall Street crash, despite government efforts at pump-priming and interest rate reductions. What Americans were witnessing, he argued, was much more than a temporary fluctuation in the business cycle. Deprived of the external drivers that had fueled economic growth throughout the long nineteenth century – high birth rates, territorial expansion, and new inventions – the American economy had entered a period of “secular stagnation” that rendered it impervious to the usual tools of monetary stimulus. “Overwhelmingly significant” in this regard was “the profound change … in the rate of population growth” that was recorded in the 1930s (Hansen 1). The “drastic shift from rapid expansion to cessation of population growth” had irreversibly dampened consumption and was therefore a “basic cause” of America’s secular stagnation (Hansen 2). Hansen’s suggested solution to this state of affairs – like that of Lawrence Summers today – was ongoing fiscal stimulus beyond mere pump priming.³ Unless the government could be persuaded to permanently stimulate private investment through the use of sustained public spending programs, America was destined for a future of stunted growth. “This is the essence of secular stagnation – sick recoveries which die in their infancy and depressions which feed on themselves and leave a hard and seemingly immovable core of unemployment” (Hansen 4).

Lawrence Summers’s secular stagnation thesis has enjoyed extraordinary success among orthodox macroeconomists who have otherwise been at a loss to explain America’s enduring economic woes. Mainstream economists who until recently were convinced that only (wage and price) inflation could be a problem and that monetary policy was sufficient for controlling it are now encroaching on the territory of heterodox post-Keynesian and Marxist scholars in their efforts to understand the magnitude of the current crisis.⁴ Summers’s secular stagnation paper has generated an enormous secondary literature (including a high-profile online debate with Ben Bernanke), variously seeking to confirm, qualify, or offer alternatives to Summers’s analysis of the causal relations at work. Most of this literature duly corroborates the importance of population in explaining America’s poor growth prospects⁵ . Summers himself does not dwell on the demographic issue – he appears to favor an ongoing program of fiscal stimulus (which may well boost population growth) to overt pronatalism. Yet his work has clearly relegitimized the crudest kind of bioeconomic thinking. Writing for the respectable Institute for New Economic Thinking, Coen Teulings and Jason Lu blame the contraceptive pill for precipitating long-term trends toward low-interest rates and secular stagnation. On the political right, the American Enterprise Institute’s in-house demographer, Nicholas Eberstadt, laments what he sees as a “global flight from the family,” pointing to its devastating economic effects in stagnant Japan, while the business media routinely identifies slowing birth rates as the prime cause of secular stagnation (Eberstadt). “Inflation rises with younger people entering the workforce, then wanes after they become most productive in their forties,” writes the popular economic forecaster Harry Dent; “deflation can set in when more people retire than enter the workforce …. Younger people drive innovation cycles, older ones don’t (there are more adult diaper sales in Japan today than sales of baby diapers!)” (Dent 1). This is the reason we may never recover, headlines Time Magazine, in a lengthy feature on the subject (Davidson).

The equation between inflation and rising birthrates, on the one hand, and between deflation and aging populations, on the other, is contested even among mainstream demographers and economists.⁶ Indeed, the credibility of the argument from population is not infrequently called into question by the very theorists who espouse it (thus, aside from the issue of demographic decline, Lawrence Summers offers a plausible account of the role of rising wage and wealth inequality in generating the fault-lines of the current crisis). Yet the equation persists, and appears to magically reappear with every major episode of inflation or deflation, suggesting the need for some deeper political and affective explanation of its staying power. This article seeks to understand the durability of the demographic theory of crisis by examining the work it performs in periods of capitalist restructuring. The theory, I suggest, operates as much through elision and displacement as positive argument, actively working to override the distributional dimension of crisis in favor of a classless narrative of generational conflict or loss. A process of debt deflation that was generated and entrenched by rising wage and wealth inequalities is transposed into the unified arithmetic of national demographic decline and denounced as a crisis of reproduction, common to all classes, but personified in various figures of un(re)productive surplus, from sterile women to pampered pensioners. If people aren’t consuming enough, this has nothing to do with the maldistribution of wealth and income, but can be blamed on the fact that they aren’t having enough children. If profitable businesses are failing to engage in new capital investment, this has nothing to do with their rising share of the national income and its disabling effects on consumption; it is simply that businesses have no incentive to invest in a diminishing working-age population and a depopulated consumer market.

It is important to stress that secular stagnation theory comes from the political left and not the right, if by “left” we simply mean favorable to expansionary fiscal policy and labor immigration. Unlike the more nativist expressions of underpopulation thinking that can be found on the right, the exponents of secular stagnation theory call for an increase in state deficit spending and a relaxation of migration controls as necessary stimuli to renewed growth.⁷ Yet their anti-austerity politics goes hand in hand with a rigorously familial, reproductive vision of the economic future. Beyond mere austerity, the notion that secular stagnation is ultimately caused by dwindling birthrates serves to deflect critique from the fact of inequality and prescribes reproductive nationalism as the natural solution to the insecurities of economic life.

Secular Stagnation: The Challenge to Macroeconomics

Almost a decade after the onset of the Great Recession, conventional macroeconomics is struggling to explain the unusually weak state of the American economy. The response to the crisis included some of the most aggressive monetary policies ever undertaken by the Federal Reserve and impressive although short-lived efforts at fiscal stimulus on the part of the Treasury. Central banks around the world were shocked into action by the failure of Lehman Brothers in the autumn of 2008. Fearing a collapse of the entire financial system, Congress responded to this event by establishing the Troubled Asset Relief Program, or TARP, which allowed the Treasury to purchase or insure over $400 billion in “troubled assets” on the balance sheets of financial institutions, while the Federal Reserve slashed interest rates to near-zero, where they have remained ever since. But constrained in what it could now do using the conventional instrument of short-term interest-rate manipulation, the Fed almost immediately embarked on a more unconventional set of operations designed to stabilize the balance sheets of banks and financial institutions, with the ultimate aim of restimulating lending. Between 2009 and 2012, it undertook three rounds of Quantitative Easing, involving mass purchases of long-term assets such as mortgage-backed securities and Treasury Bonds. These and other unconventional monetary policies transferred securities from banks and financial institutions to the Federal Reserve, expanding its balance sheet from around $850 billion to a monumental $4.4 trillion in the space of a few years. In the meantime, despite stiff opposition from Republicans and some Democrats, the Obama administration managed to enact at least some of its proposed fiscal stimulus measures, including an increase in unemployment benefits and tax cuts to low and middle income households.

Yet despite initial signs of recovery, the current state of the American economy is disconcerting. GDP growth has averaged around 2% since the end of the Great Recession, lower than the post-war average of 3% and well below the vigorous rebound rates expected after most recessions. Unemployment remains higher than it was prior to the financial crisis, and much of the registered improvement can be accounted for by workers who have given up seeking employment altogether. The Fed’s aggressive monetary policy appears to have had a paradoxical effect on investment behavior: while corporate profits are at a post-World War II high, businesses are refusing to embark on the sort of new capital investment that might increase job opportunities or bolster wage growth. Instead they are parking their savings in low-risk assets such as Treasury Bonds or engaging in short-term profit-boosting activities such as share buybacks. In defiance of the conventional macroeconomic wisdom, companies are hesitating to invest despite near zero interest rates and vigorous profits. America in fact appears to have entered a strange world of inverted macroeconomic logic very similar to that experienced by Japan over the last few decades, where profitable corporations have for some time refused to take on new debt or engage in new capital investment despite the availability of virtually free credit.

Revising Irving Fisher’s debt-deflation theory of the Great Depression, Richard Koo proposes the more comprehensive concept of “balance sheet recession” to explain the apparent anomaly of the post-crisis American and Japanese economies. Such recessions, he argues, typically occur in the aftermath of asset-price booms sustained by enormous levels of private indebtedness (The Escape 10–13). When the value of these assets plummets, households and corporations are left underwater, saddled with outsized debts on evaporated collateral. In such a situation, borrowers will do everything in their power to deleverage or pay off debt, even if they continue to rake in enormous profits. Thus a corporation that looks healthy in terms of cash flow may be suffering from hidden balance sheet liabilities that render it insolvent. When this is the case, even zero-interest rates will be insufficient to persuade a household or business to take on new debt or embark on new investment, since all income flow is channeled toward the task of paying down debt. Balance sheet recessions are relatively impervious to traditional macroeconomic policies such as monetary accommodation and short-term fiscal stimulus. Quantitative easing, which is designed to boost money creation on the part of banks and thus expand credit, will instead produce a build-up of reserves on banks’ balance sheets, since no one can be persuaded to borrow. Short-term fiscal stimulus will simply be used to pay down debt. Although rational on an individual level, the cumulative effect of multiple borrowers opting to deleverage produces a self-reinforcing “fallacy of composition,” which extinguishes all sources of demand (15). The theory of balance-sheet recession, Koo argues, can also account for the Great Depression: much like the subprime crisis of 2007, the Wall Street Crash of 1929 occurred in the aftermath of an enormous buildup of private credit and inflated asset prices; when these asset prices collapsed, corporations went into protective mode, opting to deleverage en masse rather than risk new debt-financed investment (17). In each instance—America during the Great Depression, America and Europe today, Japan after 1990—balance sheet recession prompted a radical deleveraging of the corporate sector and a faltering of new capital investment, leading to the phenomenon known as “secular stagnation.”

Like Irving Fisher before him, Koo has little to say about the role of wages in the debt deflationary process. Yet even among mainstream economists, there is a growing recognition that falling wage shares in national income before and after the crisis were critical in creating the phenomenon of enduring stagnation, both today and in the Great Depression (Rajan). Thus the historian James Livingston demonstrates that, contrary to the conventional wisdom – inherited from Milton Friedman and Anna Schwartz, and recently endorsed by Ben Bernanke (“Remarks”) – that the Great Depression was triggered by the Fed and its failure to lower real interest rates, wage stagnation was in fact primarily responsible for the prolonged debt deflation of the 1930s. Livingston traces this trend back to the 1920s, when corporations dramatically enlarged their share of profits and national income with respect to labor. The stagnation of wage growth, he notes, occurred at precisely the moment when consumer spending was beginning to serve as the new fulcrum of economic growth, a necessary demand counterpart to industrial mass production (37–38). Flush with rising profits but short on outlets for new capital investment, businesses instead channeled their surplus revenue into financial assets such as stocks and securities, while household consumption was for a short time sustained in the face of falling wages by the extension of consumer credit. But with the collapse of the real estate and consumer credit markets in 1926, followed by the stock market crash of 1929, all sources of demand were blocked and the feedback loop between unemployed surplus profits and stagnant wages became self-reinforcing (39). Businesses that were now saddled with exorbitant levels of debt on devalued assets did everything in their power to deleverage, ultimately laying off workers or compelling them to accept lower wages. And as unemployment skyrocketed and consumer demand fell still further, businesses now had even less incentive to engage in the kinds of capital investment that might create job opportunities and stimulate consumption.

Thus, Livingston concludes, the Great Depression was more than a simple credit contraction that could be triggered and remedied by monetary intervention, as argued by Friedman and Schwartz. The fault-lines of the crisis were to be found in long-term trends toward upward income redistribution, that is, the “fundamental shift of income shares away from wages and consumption to corporate profits” that left businesses with insufficient investment opportunities and workers too poorly paid to sustain demand (Livingston 37). If these fractures could be temporarily papered over by inflating asset prices and democratized consumer credit, the solution was always a precarious one given the underlying weakness of wages and the growing importance of consumption to the emerging economy of mass production.

Many economists, including those in critical conversation with Lawrence Summers, discern a similar dynamic at work in the recent American crisis. Thus Atif Mian and Amir Sufi, although broadly in agreement with Summers’s diagnosis of secular stagnation, take him to task for not sufficiently appreciating the role of wage and wealth inequalities in generating and prolonging the crisis. “In our view,” they write, “what is missing from the secular stagnation story is the crucial role of the highly unequal wealth [and wage] distribution” (“Secular Stagnation”). It is this factor, in their view, not a demographic decline in the working age population, which accounts for both the onset of the global financial crisis and its enduring impact on economic growth. If America was able to sustain consumer demand for so long in the face of stagnant wages, it could do so only by generalizing credit access to the most high-risk households, those with precarious, irregular, and low wages. An entire global market in securitized credit and credit derivatives was thus built out of the income flows of the most insecure workers, and was rendered permanently vulnerable to the smallest shifts in interest rate. When this structure came crashing down in 2007, the ensuing epidemic of deleveraging on the part of households and corporations meant that the American economy was never able to resuscitate sufficient demand to attain pre-crisis rates of growth. If low-income borrowers were made responsible for sustaining consumer demand at the height of the credit boom, the same workers, now intent on deleveraging, are having a disproportionately negative effect on demand in the wake of the crisis. “During the Great Recession, for the same decline in housing wealth, low-income households cut back on spending much more. The spending response of low-income households is twice as large as that for rich households” (Mian and Sufi, “Why”).

A similar role can be ascribed to wage deflation in the Japanese economy. As early as the Maekawa Commission Report of 1986, Japanese policy makers recognized that wages would need to rise substantially if Japan were to overcome its vulnerability to foreign export markets (Katz 89). But for various political and institutional reasons, this solution has never been pursued with enough conviction to represent a sustainable alternative. Instead, Japan turned to debt-fueled corporate investment during the 1980s before resuming its reliance on export-oriented production after the crash of 1990, all the while eluding the option of stimulating domestic consumption led by wage growth. As in the United States, real wages have been declining as a share of national income since 1973, with the significant difference that in Japan this trend has not been offset by expanding access to consumer credit (Batra). The number of non-regular workers, moreover, have been swelling since the 1980s, with many women and younger workers confined to low-paid, irregular employment with few benefits (Kingston 77–92). These already existing trends were intensified when the government further deregulated the labor market in the wake of the financial crash of 1990. All of this has conspired to limit the possibilities of domestic consumption at the very moment when it is most urgently needed as an engine of growth.

In the mid-1980s, Japan succumbed to pressure from the United States to restructure its economy around domestic demand rather than exports. The Plaza and Louvre accords of 1985 compelled Japan to deregulate its credit markets and devalue the yen in an effort to lower its current account surplus. The effects were counterintuitive: although exports fell only slightly as a result of the accords, the liberalization of financial markets and relaxation of rules governing corporate access to credit encouraged Japanese corporations to engage in highly leveraged investments in commercial real estate and stocks. The resulting boom in asset prices sustained corporate profits and economic growth for an entire decade but further entrenched the weakness of household consumption, as profits claimed an ever-greater share of national income. “High nominal wages [shrank] in the face of ever higher prices. As a result, real wages have slumped as a share of national income in the past couple of decades. In price-adjusted terms, the capital share of national income is too high and the labor share too low” (Katz 95). When the Bank of Japan finally resolved to raise interest rates in 1990, bringing the asset-inflationary spiral to a sudden end, Japanese corporations found themselves saddled with enormous debts on devalued assets, while financial institutions were left with a mass of non-performing loans. Thus began the process of debt-deflation – or in Richard Koo’s words, balance sheet recession – that has now become a familiar experience of economies around the world. Businesses that were technically insolvent but still raking in respectable profits now refused to borrow or engage in new capital investment. Declining investment exacerbated existing wage stagnation, which in turn further marginalized any hope that consumption might prove a durable pathway to renewed demand. This weakness became catastrophic after the American subprime crisis of 2007, which greatly diminished Japan’s access to a booming export market.

Thus wage stagnation represents a major fault-line in the Japanese economy, the absent stimulus without which there can be no hope of renewed economic growth. As noted by Katz, it is not that Japanese workers are “saving too much” – a truism, repeated by Bernanke (“Global Saving Glut”), that imputes a special kind of psychological perversion to Asian workers in particular – but that they are earning too little to compensate for faltering demand in other sectors of the economy. Savings rates amongst Japanese households have in fact declined by 50% since the 1970s: thus the “real culprit [is] skewed income distribution between corporations and households,” not miserly consumers (Katz 82).

Despite repeated acknowledgement of the wage factor by Japanese policy markers (including, most recently, Prime Minister Shinzo Abe), a powerful political rhetoric continues to interpret the Japanese crisis as the inevitable consequence of declining birth rates and aging populations. Thus, the well-respected economist Kosuke Motani (1) has described the Japanese predicament as a “non-monetary deflation” whose ultimate causes are to be found in the decline of the working-age population – a diagnosis that is endorsed by the former Governor of the Bank of Japan, Masaaki Shirakawa. In his alternative account of the same events, Koo remarks that the causal relation is improbable: the aging described by Motani was already well under way before the crash of 1990, and in any case, cannot explain the enormous buildup in private credit that precipitated it (The Escape 170–171). But despite such empirical failings, the demographic thesis has proven remarkably resilient and has only become more plausible with the massive levels of public debt accumulated by the government in its efforts to bail out failing banks and carry out fiscal stimulus. This debt, it is often assumed, has been incurred through rising spending on the dependent aged, a burden that is being rapidly amassed at the expense of future, unborn generations. Again, the argument has been amply deconstructed.⁸ And yet it has been plausible enough to persuade successive Japanese prime ministers to increase pension contributions and diminish benefits, a cost-cutting maneuver that is destined to further erode household spending power and thus greatly exacerbate the wage stagnation that is ultimately responsible for Japan’s continuing malaise. In this and other instances, the problem of secular stagnation is transmuted into a demographic register that defines one generation or one part of the population as an un(re)productive surplus and a burden for all others. In what follows, I explore some of the many fantasy-forms that this surplus population can take, both within and outside Japan.

Unreproductive Surplus and the Japanese Stagnation

Zeilenziger’s Shutting Out the Sun is by far the most influential exemplar of a new genre of Japan-focused cultural psychology that emerged after the crisis of 1990. Much of the force of Zeilenziger’s analysis stems from the fact that he simply reverses the valence of a previous generation of widely accepted truisms on Japanese economic life, discerning manic-depressive zeal where commentators once saw unstoppable momentum, and stultifying conformity where others once saw an enviably organized form of flexibility. Japan no longer represents the nation that others strive to emulate, but a distorted mirror image of American vitality: “the decline of a great power like Japan is relevant – or cautionary – to citizens of other great nations who, like Americans, wonder whether their society too, might someday lose its vital gift for reinvention or renewal” (Zeilenziger 10). This gift for reinvention finds self-evident expression in America’s economic and demographic growth, just as Japan’s post-crisis stagnation is reflected in its low birth rates and aging population. “Demographics define destiny,” Zeilenziger observes, before explaining that, thanks to its “rapidly shrinking population,” Japan will soon enter “a ‘zerogrowth’ era when average annual growth is not likely to exceed 0.3 percent” (162).

Extrapolating from the demographic data, Zeilenziger suggests that if post-crisis stagnation has lasted so long, it is because Japan overprotects the old at the expense of the young and burdens the future with the weight of inherited public debt. In Zeilenziger’s narrative, the young represent the entrepreneurial spirit of Schumpeterian innovation while the old are equated with the paternalist weight of economic protectionism, the corporate bias toward seniority and the accumulated burden of state deficit spending. The paradoxical effect of this deference toward the old is the permanent infantilization of the young, who struggle to emerge out of the shadow of their parents to reach full reproductive adulthood. Here, Zeilenziger evokes the stock figure of the hikikomori, adolescent males who retreat to their rooms and refuse the responsibilities of the male breadwinner role. The alleged economic protectionism of the Japanese state finds its intimate counterpart in the stifling paternalism of the Japanese family, which emasculates the son by maintaining him in a state of permanent pre-adulthood:

For just as a hikikomori shuts himself off in his room rather than mediate a society he finds intolerable … Japan chose to ignore the obvious signs that its corporations invested and exported too much, that its webs of closed, protective relationships would never be as dynamic as open ones, and that national investment schemes that relied on government experts to envision the future would never consistently outperform those who summoned the wisdom of independent innovations [and] diverse risk-takers. (Zeilenziger 96)

In the same way that an overly activist central bank chose to “emasculate” the stock and bond markets by bailing out corporations and banks in the wake of the crisis, Japanese parents are somehow responsible for castrating their sons and preventing their emergence into reproductive adulthood (Zeilenziger 100). Inversely, Zeilenziger evokes the female counterpart to the hikikomori, the “womb-striking woman” who lives with her parents well into childbearing age and refuses to bring forth a new generation of Japanese worker/consumers. “Shrinking maternity wards and abandoned kindergarten classrooms across the nation testify to the pitiless impact of the baby boycott” (Zeilenziger 162).

Zeilenziger’s work lies squarely within a popular tradition of prurient commentary on the peculiarities of Japanese economic and cultural life. But even the critical academic literature presents the relationship between declining birth rates and economic stagnation as a matter of fact. Thus, Anne Allison, in her Precarious Japan, bluntly asserts that the country’s demographics are “complicit in its troubled social condition” and points to the sheer mass of aging, nonproductive bodies and aborted infancies as material proof of this predicament (34). “Amassing population at the upper, rather than lower, end of the age demographic chart,” she asserts, “puts obvious strain on the economy in terms of both productive output (a shrinking workforce and decrease in those contributing taxes) and social reproductivity (a rise in those needing care in comparison to those who can, or are willing to give it). . . . There are fewer workers today to support the elderly: a decrease in what is called the ‘dependency ratio’” (Allison 35–36). The idea that public finance is fatally threatened by a skewed “dependency ratio” in favor of the elderly has been amply critiqued – it ignores the fact that rising numbers of young people present an equally large dependency burden; assumes that all working age citizens are actually employed; and elides the fact that pension funds are invested, not simply amassed⁹ – yet it is presented here as a self-evident recipe for declining growth and productivity, rendered unanswerable by the surfeit of aging over newborn flesh. Sliding between the metaphorical and the causal, Allison presumes that demographic shortfall and economic deficit are functionally equivalent:

Tending to the health and health care of the nation increasingly means shifting focus from a red-cheeked new-born to aging flesh. The implications in terms of outlay (of national resources) and output (of productive yield) are tremendous. If the child signifies potential – a forthcoming of growth, productivity and futurity – the elderly signifies deficit, the progressive decline of vitality whose fullness is past. Not only does the temporality of life differ here, so does its economics: what one requires and extracts in order to live and what one produces or yields in the course of living itself …. National coffers are getting eaten up by the costs of keeping so many elderly alive, a slow (economic) death brought on, at least in part, by the country’s slowly dying elderly, and so many of them. (36–37)

The implicit reference here is to Lee Edelman’s No Future and although her tone is melancholic rather than transgressive, Allison is more faithful to Edelman than at first appears inasmuch as she presents the reproduction of the national future as a structural condition of economic hope (Edelman, for his part, is indebted to Lacan’s linguistic structuralism and as such sees heterosexual reproduction as an inescapable referent of desire, one that can be transgressed but never abolished). “Even with one of the lowest infant mortality rates,” Allison writes, “human life in the biological sense has a harder time actually coming into existence than surviving into old age in the country. Human life is dying slowly, and just as slowly, getting (re)born – a reality that confounds reproductive futurism” (35). Although Allison sometimes qualifies the overwhelming momentum of her argument from demographics with the acknowledgement that things might be imagined otherwise, her default mode of address is a kind of discours indirect libre that tends to confirm and endorse the truth of reproductive nationalism rather than question it.

This genre of angst-ridden reflection on Japanese demographics is by no means a simple projection from the outside. Indeed, both Zeilenziger and Allison are in close conversation with a burgeoning literature on population crisis produced from within Japan, and widely disseminated in the popular media.¹⁰ One scholar who has done more than any other to popularize the demographic theory of economic crisis in Japan is the sociologist Masahiro Yamada, of Tokyo Gakugei University. Yamada, who famously characterized Japan’s post-crisis stagnation as a “low-birth-rate recession” (“Why”), identifies the figure of the so-called “parasite single” as the primary cause and symptom of this state of affairs (The Era; “Parasite”). The term “parasite single” refers to young, single, often highly educated women who earn a wage but choose to live at home with their parents, and who engage in sexual relations but refuse to marry or have children.¹¹ These figures encapsulate both aspects of the Japanese crisis as Yamada understands it: the failure of consumer demand to catapult the economy out of its lingering post-crisis stagnation; and the failure of young women to sustain the reproduction of the Japanese nation. In his more sympathetic moments, Yamada understands this failure in structural terms, as a symptom of a modernization process that was both hyper-accelerated and hopelessly retarded (“Parasite” 10–11). As women have entered the workforce in growing numbers, Japanese gender relations and welfare institutions have not evolved fast enough to relieve women of some of the burdens of caring for young children; yet they can no longer expect young men to earn a wage sufficient to maintain them as housewives at home. Young women are well aware that marriage and childbirth signal the end of their chances at earning a living wage and their relegation, post childrearing, to low-paid, precarious work at the margins of the Japanese workforce. It is perhaps understandable then, Yamada notes, that many young women choose to delay or avoid marriage and childbearing altogether (“Parasite” 10–11).

Yamada nevertheless sees these women as ultimately responsible for Japan’s state of enduring stagnation. After all, these women often earn a good wage, but refuse to spend it on productive forms of consumption that might support Japanese GDP growth. Instead of establishing a new household and purchasing Japanese consumer goods, they engage in the most frivolous forms of unproductive consumption. Citing a 1998 survey conducted by the Nikkei Research Institute, Yamada remarks that even with low salaries, parasite singles are able to spend lavishly on foreign luxury goods because their parents are supporting them: “You might have seen young Japanese women travelers all over the world, staying in luxury hotels and buying expensive designer-label bags, accessories, clothing and other items” (“Parasite” 12). By continually diverting their wages away from the national consumer market, these women contribute to the weakness of domestic consumption and thus serve to prolong the Japanese crisis: “Since parasite singles do not spend money for basic needs such as housing, appliances and furniture, they hinder the nation’s recovery from recession” (“Parasite” 16). But beyond their predilection for nonproductive consumption, single women also stand accused of indulging in non-reproductive sex thanks to the proliferation of “love hotels” that allow unmarried couples to meet outside the family home. It is not that young women do not consume, then, it is that their forms of consumption (of commodities and sex) work to undermine the (re)production of national economic life, constantly diverting the fruits of productive labor into various types of “surplus” or non(re)productive enjoyment.

Here Yamada performs a conceptual maneuver that is emblematic of the conservative critique of capitalism: one particular social demographic is singled out as a rentier class of unproductive aristocrats, living parasitically off the productive energies of the nation and undermining its vital force, and thus blamed for the recurrent crisis tendencies of capital itself. In this instance, young women are made to personify a form of capital identified as un(re)productive, sterile and cosmopolitan – thus “financial” – and opposed to a form of capital presumed to be productive because it is oriented toward national economic and demographic growth. “In a way,” Yamada explains,

parasite singles represent an affluent class that can live like Japan’s ancient aristocrats. In many countries in the West, being young and single usually means living a life of austerity if not poverty. In Japan, however, as long as young people can parasitize their parents, they have a kind of affluence, even if they earn very little or even if they don’t work. (“Parasite” 12)

In this way, the forms of unemployed surplus (labor or capital) that are recurrently generated by capitalism’s crisis tendencies are personified in some figure of social surplus, who can then be exorcized or disciplined into a more (re)productive way of life. Once this logic has been established, the elimination or reform of this surplus persona presents itself as the obvious solution to economic crisis.

Unreproductive Surplus and the Demographic Theory of Crisis

Demographic theories of economic crisis have a long intellectual pedigree dating back to the beginnings of political economy and can take both underpopulationist and overpopulationist forms. Thomas Malthus, writing at the very origins of the discipline, notoriously argued that bioeconomic laws governing food production and human fertility would inevitably lead to periodic crises of overpopulation, hence excessive consumption, plummeting wages and misery among the poor. Malthus’s early work on the principles of population proposed an essentially exogenous theory of economic crisis, where the natural rate of reproduction was seen as posing an extrinsic limit to the rate of economic growth. Population tended to grow at a geometrical rate; food production could increase only in arithmetical fashion. If left unchecked, the disjuncture between the two would recurrently generate a surplus of underemployed workers incapable of reproducing their own means of subsistence (Malthus, An Essay).

We owe the term “Malthusianism” to this very early phase of Malthus’s work. Yet as recognized by his great admirer, John Maynard Keynes, Malthus’s original thesis on overpopulation gave way in his later work to a theory of underconsumption, which seemed to suggest exactly the opposite conclusions on the question of population (Keynes, “Some Economic Consequences” 522). In the years following the Napoleonic wars, Malthus was confronted with a set of economic circumstances very different to those that prevailed at the turn of the century: contrary to his own predictions, grain prices declined dramatically in this period, leading to an accumulation of unused grain stocks that could find no profitable outlet in the consumer market. In what appeared as the ultimate contradiction in terms, overproduction and unemployed capital existed side by side with unemployed labor and faltering demand. Malthus accordingly shifted his attention from the question of overconsumption (and underproduction) to that of underconsumption (and overproduction [Principles]). Implicit here was the idea that underpopulation had replaced overpopulation as the most urgent issue confronting the English economy. Despite the popular currency of the term “Malthusianism,” it is this later work that has left the most enduring mark on the discipline of economics in the form of the underconsumption theory of crisis.

The same tension can be found in the work of Keynes. Having devoted considerable energy to reviving the reputation of the early “Malthusian” Malthus at the end of World War I (The Economic Consequences and “Is Britain”), Keynes abruptly reversed his position in the 1930s to warn that the most pressing problem facing Britain and the United States was in fact plummeting birth rates, which could well lead to a protracted crisis of underconsumption.¹² Keynes first raised this possibility in passing in The General Theory of 1936 (220–221), then dwelt on it extensively in a paper published one year later in The Eugenics Review (“Some Economic Consequences”). Had Keynes abandoned the “Malthusianism” of his early work? No, he insisted, it was simply the case that the historical conquest of the population problem (signified in England by the recent legalization of birth control advice to married couples [Hoye 186]) meant that new, previously undreamt of problems had now emerged to confront the modern nation-state. In spite of all its dangers, an

increasing population has a very important influence on the demand for capital. Not only does the demand for capital – apart from technical changes and improved standard of life – increase more or less in proportion to population. But, business expectations being based much more on present than on prospective demand, an era of increasing population tends to promote optimism, since demand will in general tend to exceed, rather than fall short of, what was hoped for. … But in an era of declining population the opposite is true. Demand tends to be below what was expected, and a state of over-supply is less easily corrected. Thus a pessimistic atmosphere may ensue …. The first result to prosperity of a change-over from an increasing to a declining population may be very disastrous. (Keynes, “Some Economic Consequences” 519)

Having thus established a causal relationship between economic and demographic expectations. Keynes went on to express his own pessimism about the situation of the world economy in the 1930s, where anemic demand appeared to combine with plummeting birth rates to augur a new era of perpetually disappointing growth prospects.

These reflections would soon be transformed into a fully operative thesis of secular stagnation by Keynes’s disciples on both sides of the Atlantic. In Britain, John R. Hicks seized upon Keynes’s remarks in The General Theory to deduce an elaborate demographic theory of falling demand: “With increasing population, investment can go roaring ahead, even if invention is rather stupid; increasing population is therefore actually favorable to employment. It is actually easier to employ an expanding population than a contracting one, whatever arithmetic would suggest.” But when population is falling, “investment will proceed only with great difficulty, and employment will be low, in spite of the fact that population may have already declined in the past” (Hicks, “Mr Keynes’s Theory” 16). Hicks, who was among the most influential popularizers of Keynes’s work, placed even greater emphasis on the population factor than Keynes did, noting that the “population point is enough in itself to establish the high significance of Mr. Keynes’s theory of long-period unemployment” (16). In his monumental Value and Capital, he noted in passing that the “whole industrial revolution of the last centuries” had perhaps been “nothing else but a vast secular boom, largely induced by the parallel rise in population” (302).

Alvin Hansen too thought that the debt deflation of the 1930s signaled a phase change in long-term growth trends – hence the term “secular” as opposed to “cyclical” stagnation.

The economic order of the western world is undergoing in this generation a structural change no less basic and profound in character than that transformation of economic life and institutions which we are wont to designate loosely by the term “Industrial Revolution.” We are passing, so to speak, over a divide which separates the great era of growth and expansion of the nineteenth century from an era which no man, unwilling to embark on pure conjecture, can as yet characterize with clarity or precision. (Hansen 1)

This secular transition from high to low economic growth could ultimately be ascribed to the cessation of those external forces that had provided such spectacular and abundant investment returns throughout the nineteenth century – chief among them rapid population growth.

These Keynes-inspired secular stagnation theories took root in a context of declining birth rates and general pessimism about the future of demographic growth. The work of Keynes, Hicks, and Hansen was of a piece with the apocalyptic tone of professional demographers such as Enid Charles, who in her contemporaneous work on The Menace of Underpopulation, evoked the “spectacle of a society that has lost the power to reproduce itself” (qtd. in Peterson 238).

It was not until the 1970s, as advanced economies found themselves confronted with the combined problems of inflation and unemployment – or so-called stagflation – that the old Malthusian theories of overpopulation made a comeback. In a context where public spending on welfare was rising alongside inflating wage and consumer prices, commentators of the period routinely interpreted stagflation as a crisis of overconsumption or excessive demand, which was in turn linked with the phenomenon of rising birth rates. American neoconservatives such as Daniel Bell theorized inflation as the inevitable effect of excessive distributional demands pressing on the limited fiscal powers of the state and distorting the price of money. Monetarists such as Milton and Rose Friedman reversed the causal relationship and instead saw inflation as the direct expression of an excessive increase in the money supply, prompted by overspending on the part of the state. But both neoconservatives and neoliberals were convinced that state spending on welfare programs to unmarried, mostly African American mothers seemed to be subsidizing the over-reproduction of a future surplus population of welfare dependent children (Cooper, Family Values 25–66). Overconsumption signified excessive, unprofitable reproduction that would inevitably lower the profit margins of business. In this context, lower-class minority women were predictably imagined as unproductive rentiers living off the unearned income of welfare benefits – welfare queens as opposed to productive workers and non-dependent reproducers.

At first nurtured in the context of the national economy, the diagnosis of overconsumption was soon extended to the global economic space, where various postcolonial states were rapidly increasing their rates of consumption while also asserting their newfound powers to push up the costs of first-world consumption by demanding higher prices for oil. As demographers contemplated the likely economic effects of rising consumption in the developing world, they warned of the imminent disaster of overpopulation (Ehrlich; Meadows, et al.). Without proper limits to consumption and population growth, it seemed that the world would soon be faced with a series of systemic crises implicating the runaway effects of greenhouse gases on the earth’s biosphere, the toxic residues left behind by petrochemical production, and conflict over the earth’s diminishing food and energy resources.

Although typically championed by very different constituencies, it is important to recognize that theories of under- and overpopulation subscribe to the same logic and therefore demand an overarching critique.¹³ In each case, a protracted episode of inflation or deflation is attributed to a literal inflation or deflation of reproductive desire, which in turn is assumed to be confirmed by rapidly escalating or waning birth rates (sex is only ever reproductive within these narratives). When prices and wages are rising with respect to profits, as in the 1970s, it is assumed that women are reproducing too much. Their excessive fertility is responsible for a surplus population of unproductive, unemployed, or underemployed youth whose outsized consumption needs are placing unsustainable fiscal demands on the state. Economic growth may be accelerating thanks to the sheer number of new workers entering the labor market, yet productivity is slacking off as workers enforce rising wages or find alternative sources of income in overabundant welfare provisions. Alternatively, when prices and wages are declining with respect to profits, and when this decline is strong enough to undermine economic growth itself, it appears that women are not fertile enough. Their refusal to reproduce is creating a surplus of unproductive old people, who in turn are unfairly burdening both the state and future generations with their excessive consumption needs. Productivity amongst employed workers may remain high, but economic growth itself is slowing down thanks to the absolute decline in the number of people entering the workforce. In each case, an endogenous cycle of inflation or deflation (endogenous because its cause lies in the structural antinomies of the capitalist mode of accumulation) is attributed to the exogenous causality of reproductive failure. With each iteration of this narrative, we are invited to identify some figure of un(re)productive surplus who is thereby made to personify the failure of economic growth itself, its unemployable and unprofitable excess.

Karl Marx is one of the few to have mounted a serious critique of the demographic theory of crisis. What the classical political economists (from Malthus to Ricardo and John Stuart Mill) understood as external limits to an increasing rate of profit, Marx theorized as a limit internal to the capitalist mode of accumulation itself (Capital: Volume III 350, 358). That is to say, when any particular historical regime of capitalist accumulation experiences a crisis of under- or overconsumption,¹⁴ what it has come up against is not a bioeconomic limit to its further expansion but rather an inability to increase the exploitation of labor (hence productivity) without destroying its own raison d’être – an ever increasing rate of profit. At a certain point, the threat of under-consumption and unrealized demand can only be resolved by increasing wages; inversely, the threat of overconsumption and excessive demand can only be remedied by decreasing labor productivity; but to take either path would mean abandoning the need to deliver ever higher rates of profit. In simple terms, the capitalist process of accumulation is perpetually hampered by the drive to maintain and indeed exacerbate a certain structural inequality, not only between wages and profits, but also among wage earners themselves.

Marx thus reinterprets the ostensibly natural limits to growth, identified by the classical political economists, as so many endogenous limits specific to the capitalist mode of accumulation. What looks like a natural surplus of un- or underemployed workers, excluded from a living wage by sheer weight of numbers, reflects an internal necessity of capitalism itself – the need to marginalize a certain section of the population from the core of the waged workforce in order to maintain wages as low as possible. And what look like natural demographic divisions within the workforce – divisions between women and men, adults and children, migrants and residents – are strategic borders that serve to differentiate a core workforce from a proliferating surplus of ever lower-paid workers, keeping wages as low and productivity as high as possible for all (Marx, Capital: Volume I 788). Yet this constant drive to produce a portion of under- or overemployed workers ends up sabotaging the capitalist accumulation process itself, periodically preventing it from realizing the full value of expected profits.

Unlike the classical political economists, Marx understands the problem of realization (hence demand) as a function of wage and wealth distribution, not demographics: wages in turn are “not determined by the variations of the absolute numbers of the working population, but by the varying proportion in which the working class is divided into an active army and a reserve army” (Capital: Volume I 790). It follows that crises of over- or under-consumption are generated endogenously to the capitalist mode of accumulation; they are the counterproductive fallout of its driving logic, the need to push wage and wealth inequalities as far as possible. If the “labor market sometimes appear[s] relatively under-supplied because capital is expanding, and sometimes relatively oversupplied because capital is contracting,” it would be “utterly absurd, in place of this, to lay down a law according to which the movement of capital depended on the movement of the population. Yet this is the dogma of the economists” (Capital: Volume I 790).

Marx’s critique of the demographic theory of crisis has rarely been surpassed. His analysis helps explain the way that capitalist failures of realization are repeatedly personified in a surplus population of unproductive, devalued humanity and thus attributed to natural laws external to capital itself. Yet Marx never quite captures the gendered and sexual dimension of this sleight of hand – the fact that unproductive surplus is also necessarily configured as un(re)productive surplus – and at times succumbs to the very fantasies he denounces elsewhere. Thus in his essays on The Class Struggles in France: 1848–1850, Marx equates the sterile accumulation of financial capitalism with the unproductive character of the non-industrial lumpenproletariat: “In the way it acquires wealth and enjoys it the financial aristocracy is nothing but the lumpenproletariat reborn at the pinnacle of bourgeois society” (“The Class Struggles” 39). Both, he claims, are animated by a perverse appetite for luxurious consumption, a desire that is “in permanent conflict with the bourgeois law” of productive labor and reproductive desire, the “same unbridled assertion of unhealthy and vicious appetites … , appetites . . . in which pleasure becomes crapuleux, in which money, filth and blood commingle” (39). Elsewhere, and more ambiguously, he contrasts the finite, reproductive development of organic life and labor with the strangely self-referential, self-regenerative, and proliferative logic of capital, where desire begets desire beyond the demands of natural reproduction – a distinction that is richly informed by Thomist and Aristotelian denunciations of usury, sodomy, and prostitution.¹⁵

It is ultimately this equation between the nonreproductive logic of financial capital and the non- (or over- or under-) reproductive desire of the surplus population – openly endorsed in Marx’s early political writing – which lies at the heart of the demographic theory of crisis. It is this equation which drives the revival of secular stagnation theory today and this equation which must be destabilized if we are to avoid the idea that reproductive nationalism is our only answer to economic crisis.

Footnotes

1. The English-language journalistic literature on the subject of “why the Japanese aren’t having sex” is too vast to reference.

2. An early and highly prescient analysis of this conjuncture can be found in Gopal Balakrishnan’s “Speculations on the Stationary State,” which predates the current revival of secular stagnation theory. Balakrishnan’s reflections on current tendencies toward deflation return to the problematic of the “stationary state” in classical political economy. In her essay “The Culture of Secular Stagnation,” Annie McClanahan also discerns a rich conceptual history behind contemporary secular stagnation discourse, one that is concerned as much with biological as with economic narratives of renewal and decline.

3. Rosenof drives home the point, noting that

[c]ritics often lambasted Hansen and other secular stagnationists as pessimists who were resigned to a no-growth economy. Hansen and others responded that they were in fact optimists, given the correct remedy to the diagnosed condition. That is, Hansen was not arguing that growth had come to an end but that growth based on a certain set of exogenous forces had stagnated. The key, of course, was not passive acceptance of stagnation but vigorous efforts to develop new stimuli to investment and growth to replace those in decline. The unprecedented nature of this era of secular stagnation required an unprecedented response: massive public investment. (59)

4. By mainstream macroeconomists I refer to both New Classical and New Keynesian economists. New Classical economics emerged in the aftermath of the stagflation crisis of the 1970s and in response to the failure of Keynesian economics to explain it. It is associated with the names of Robert Lucas, Thomas J. Sargent, Neil Wallace, and Robert Barro, who sought to reestablish macroeconomics on Walrasian microeconomic foundations. Their macroeconomic models were built on the assumption of rational expectations and perfectly competitive, self-equilibrating markets free of “stickiness” or rigidities. The New Keynesians accepted many of the microeconomic principles advanced by the New Classicals but rejected the notion that labor and commodity markets could be assumed to be perfectly competitive. Instead they introduced the notion of market rigidities and coordination problems into their models and recognized a place for limited fiscal intervention to correct these failures. New Keynesian economists must be distinguished from post-war neo-Keynesian economists, such as Paul Samuelson, John Hicks, and Franco Modigliani, who engineered the so-called neo-Keynesian synthesis between neoclassical economics and Keynesian theory, and in general accepted a strong role for government intervention in markets. They must also be distinguished from the post-Keynesian economists, who remain committed to a heterodox, non-neoclassical view of Keynesian economics, often combined with the insights of later heterodox economists such as Hyman Minsky.

Raghuram Rajan is the most prominent of the New Classical economists to have invoked the Keynesian concept of secular stagnation and its relationship to inequality. Among the New Keynesian economists who have written on secular stagnation theory are Lawrence Summers, Paul Krugman, and Robert Gordon. For an alternative, post-Keynesian view on the global financial crisis, see Stockhammer. The post-Keynesian economist Thomas Palley has written an extensive critical overview of mainstream macroeconomists’ newfound interest in the classically Keynesian issues of secular stagnation, demand, and inequality.

5. See Goodhart and Erfurth; Teulings and Baldwin; Gordon.

6. Although the equation between deflation and demographic trends has become seemingly ubiquitous in the wake of the financial crisis, with Japan persistently cited as incontrovertible proof, a number of mainstream voices point to the absence of any serious causal relationship. Richard Koo is certainly amongst the most well-known critics of the demographic theory of deflation, as is the current Governor of the Bank of Japan, who openly challenges his predecessor on this issue. See Warnock and Frangos. For their part, demographers have often been more circumspect than economists about the links between macroeconomic and population trends. See Bloom et al.; Herrmann. My own view, informed by Kalecki’s “The Political Aspects of Full Employment,” is that price movements, whether inflationary or deflationary, are mediated by the distribution of wealth and income, and are therefore inevitably reflective of political rather than demographic processes. Price deflation is shaped by wages, investment decisions, the proportion of employed to unemployed people, and social spending decisions, and cannot be deduced in numerical fashion from simple demographics. In the most obvious sense, the “working age population” is very rarely equivalent to the actual waged population and therefore represents a politically flexible (as opposed to natural and irreducible) limit to demand. To lament the dwindling of the working age population in the United States is to ignore the fact that a significant proportion of this population (African American men, for example) are very deliberately quarantined outside of the formal labor market as a political imperative of US capitalism. If US economic growth is suffering from a shrinking of the working age population, why not reintegrate them into the workforce? At this point it becomes clear that the driving force behind price deflation is the production of (class-based, racial, and gendered) inequalities, not numerical demographics. The same qualifications must be applied to inflation, which in the 1970s was closely correlated with the growing political power of the working class to demand higher wages and (in the case of women) to exchange unwaged for waged labor. Inflation was never simply a question of rising birth rates, but rather the effect of increasingly powerful political movements from below. Wage inflation represents the power of political movements to diminish inequality and push up demand, just as wage deflation derives from the increase in inequality and resulting contraction of demand.

7. Even a commentator such as Douthat takes Japan to task for its tight immigration controls, citing them as evidence of its cultural and economic stagnation, while attributing much of America’s demographic dividend to its relaxed migration policies and relative cultural liberalism. “Our family structures are weakening, but high out-of-wedlock birth-rates may be preferable to no births at all. We assimilate immigrants more slowly than we should, but at least we’re capable of assimilation.”

8. See Campbell; Kingston 42–43.

9. See Burtless.

10. See Driscoll for a richly detailed account of this discourse and its close imbrication with the question of public debt. Driscoll demonstrates just how influential this discourse has been in shaping recent social policy in Japan.

11. For a critical overview of the literature on “parasite singles” in Japan, see Lunsing.

12. See Peterson for an extensive discussion of the population question in Keynes’s work.

13. Recent feminist critiques of demography tend to focus exclusively on theories of overpopulation, sometimes pointing to the ways in which feminists have colluded with eugenic projects of population control in the past. Yet this focus neglects the fact that underpopulation theories are equally common in the history of demography and indeed equally popular among historical feminists (Enid Charles is a case in point). The silence on this history is striking. My contention here is that a comprehensive critique of the demographic theory of crisis must capture what is common to theories of underpopulation and overpopulation. Failing this, feminist theories run the risk of proposing an alternative pronatalism or an alternative reproductive nationalism – one that is more often than not displaced onto the postcolonial nation or racial minority and thus, it is assumed, redeemed.

14. I am in agreement with Desai, who argues that Marx was equally attentive to crises of overproduction and underconsumption, contrary to a certain Marxist orthodoxy that insists that underconsumption is a strictly reformist Keynesian problematic and was not of interest to Marx. This orthodoxy has proven particularly harmful in the current crisis, which is quite obviously connected to the questions of consumer credit and wage stagnation.

15. See Marx, Capital: Volume I 254–257; Cooper, “The Living and the Dead”.

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