Rising Dependency Ratios Owing to the Aging Population Will Call for Replacement Migration Research Proposal

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Immigration

Bongaarts (2004) reports that since 1950 the median age in North America, Europe Japan and the rest of the developed world has increased from 29 years to 37 years. In addition by 2050 the median age is expected to increase to 45 years old. However in the developing world, including North America and Africa, the median age is 24 years. Although the median age is lower in the developing world these nations are also experiencing declines in both mortality and fertility rates will increase the median age to 36 by 2050. These facts concerning median age in societies around the world are important to understand because they dictate the public policy decisions.

How does the presence of an aging population affect public pension programs?

How do current immigration laws dictate how replacement immigration might be impacted by immigration laws?

Problem addressed by proposed study

The aging of the population in developed countries is a major problem because it threatens the sustainability of public pension systems such as social security. There was a time that the elderly were supported through community and family arrangements but the ability of families to care for the elderly in this manner has decreased in recent years. Instead, nations in the developed world utilize both private and public pensions and healthcare that is also paid for by the government. These pension programs have been important because they serve the purpose in assisting the elderly in remaining independent while also closing a substantial income gap between the working age population and elderly individuals. In addition the rates of poverty amongst the elderly has decreased drastically all over the world as a result of public pension programs.

The problem with the public pension programs is their reliance on pay-as-you-go distribution of funds because the younger generation pays for the current generation of elderly people. However this system is unsustainable and burdensome. In addition because old age dependency rates are increasing and the number of young people contributing to the system is decreasing there is the likelihood that such pensions will no longer be available in the future. In fact the International Monetary Fund has examined this topic and concluded that "failure to address these fiscal stresses in pay-as-you-go pension systems could inflict

"serious macroeconomic damage, both on the domestic economy and, in the case of large industrial countries through international linkages, on the world economy (Chand and Jaeger 1996: 1) (Chand and Jaeger 1996: 1). The need to identify and implement reforms of public pension systems under these changing demographic conditions represents an urgent challenge for public policy." [footnoteRef:1],[footnoteRef:2] [1: Bongaarts, John. Population Aging and the Rising Cost of Public Pensionshttp://www.popcouncil.org/pdfs/wp/185.pdf] [2: Chand, Sheetal and Albert Jaeger. 1996. "Aging populations and public pension schemes," IMFOccasional Paper Number 147. Washington, DC: International Monetary Fund.]

Topic and Boundaries

For the most part such efforts to change public policy have focused on the phenomenon know as replacement migration. The United Nations (UN) refers to replacement migration as "the international migration that would be needed to offset declines in the size of population and declines in the population of working age, as well as to offset the overall ageing of a population." The proposed topic will investigate the replace migration in the context of migration law and regulations. The topic will be limited to exploring migration law and regulations in the United States.

Contributions

The provided research will assist academics, legislatures and attorneys in addressing the problem of ageing and declining populations within the context of public policy programs. At the current time it is quite evident that programs such as social security are in desperate need of reform. Failing to reform such policies will have devastating consequences for future generations. As such clear research on the legal and regulatory standards that govern replacement immigration are of the upmost importance. The problems that face the social security program must be properly addressed because failure to do so could lead to dire consequences for the aging population. Replacement immigration may be one of the solutions that might permit the country from avoiding a catastrophe

Preliminary review of the literature

Social Security is a public policy designed to provide citizens over the age of 65 with a monthly pension. This pension is presented to those who paid into social security when they were in the workforce. Social security is unique in that the current generation of workers are provide the monthly pension for the current generation of retirees.

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However, the increase in the median age of the population in developed countries has called into question the manner in which public policies such as the social security system operate.[footnoteRef:3],[footnoteRef:4] For instance Feinleib & Warner report that [3: Coleman, D.A. (2002) Phil. Trans. R. Soc. Lond. B 29 April 2002 vol. 357 no. 1420 583-598] [4: Espenshade T.J. (2001), "Replacement Migration" from the Perspective of EquilibriumStationary Populations, Population and Environment 22 (4): 383-400.]

"The challenges facing the Social Security program and the economy as a whole will grow over the coming decades as the Baby Boom generation enters retirement and as improvements in human longevity contribute to an inevitable and significant increase in the proportion of Americans over the age of 65."[footnoteRef:5] [5: Feinleib J., Warner, D. (2005). The Impact of Immigration on Social Security and the National Economy. http://www.ssab.gov/documents/IMMIG_Issue_Brief_Final_Version_000.pdf]

With this problem understood several legislatures and scholars have suggested that replacement immigration will provide a needful alternative to addressing the issue of the ageing population. In fact a report on a meeting of the Social Security Advisory Board held in 2005 reports that replacement immigration is one of the tactics being examined in an effort to assist the social security system. Replacement immigration is promising because "most immigrants to the U.S. tend to enter the U.S. As young adults rather than as children, they do not lower the average age of the population by very much. As they age along with the native-born population, they tend to raise the average age of the nation. However, they also tend to have slightly higher fertility rates than non-immigrant families. The age at entry of immigrants and their fertility rates will have some mitigating effect on the overall aging of the population…"[footnoteRef:6] [6: Ibid]

Feinleib and Warner (2005) further explain that immigrants that come into the country legally pay taxes into the Social security trust. However legal immigrants that don't return to their countries of origin prior to becoming eligible also become beneficiaries of the social security system, Additionally,

" Among illegal immigrants, SSA actuaries currently assume that about half actually pay social security taxes although they are very unlikely to collect benefits. The number of immigrants entering the country affects the size of the working age population, the size of the labor force, the number of workers in OASDI covered employment, and thus the size and growth rate of GDP. In addition the children of immigrants will continue to affect the size and growth rate of GDP and the ratio of workers to beneficiaries well into the future. A 2004 memo from the Office of the Chief Actuary pointed out that the change in the actuarial balance of the Social Security Trust Fund from an increase in immigration of about 250,000 per year would be about 0.1% of taxable payroll, or about 5% of the currently projected actuarial deficit."[footnoteRef:7] [7: Ibid]

An additional report published in 2005 revealed that the estimates in the long-term actuarial balance of the Trust Funds ranged between the low (672,500) and high (1,300,000) based on immigration assumptions. The report also concluded that the amounts will be .44% of taxable payroll (from -2.11 to -1.67).[footnoteRef:8] [8: Ibid]

Although replacement immigration may seem to be a viable solution in theory, this practice can also cause a great deal of conflict and confusion as it pertains to existing immigration laws.[footnoteRef:9] At the current time in the United States there are immigration laws that cover a wide range of issues from asylum to work visas. These laws can be used to both prevent and promote replacement immigration. Additionally other problems can arise when immigrants begin to enter into any country in significant numbers. In many instances the existing infrastructure cannot absorb a significant influx of immigrants. Such influxes threaten make society more vulnerable for everyone. With these things understood it is important that any type of replacement immigration that is practiced has significant controls designed to manage the influx of new people into any given area of the country. [9: Keely C. 2002. Replacement Migration: the wave of the future? International Migration. 39(6): 103-110. ]

Research Strategy and methods

The proposed research will mandate the use of a qualitative research method. The qualitative method will include careful examination of existing literature on the need for replacement migration as a resolution for fluctuation in the population age in developed and developing regions of the world. The proposed investigation will focus on.....

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