The media impact of economic news publications is mainly the result of their predictive nature. It is not new. Since the beginning of humanity, and astrology emergence can testify of it, men are obsessed by what may arrive to them and pay a lot of attention to those who pretend to tell it to them. The success of economics and of the economists is the current version of this phenomenon. There is not a single day without the release of economic forecasts. Due to the necessary delay to gather numbers we are at the point where we forecast or revise forecasts regarding, sometimes, past periods. We could add that, as the accuracy of the figures is low, when variations are small, to talk about rise or fall has not a great sense.

At the contrary, it exist a subject which predictable character is sure, in peace time of course. It is demography. It is easy to measure, at a given time by a count, the size of a population, and the age of those who compose it. And the analysis of the past permits, with a good accuracy, to predict short and midterm evolution, thanks to the knowledge of birth and death rates, and life expectancy. Nobody put seriously in question the relevance of the studies related to these matters, but nobody also questions the fact that they are rarely taken into consideration in the judgment on an economic situation and more, about their consequences on this situation.

Japan secular stagnation is definitely not the consequence of its economic choices. It is the mechanic result of its demographic situation, which is perfectly apprehended. Yet, international institutions, and a top of them, national bodies, talk at length about some aspects of the policies supposed to take the country out of that stagnation. But this situation results from the refusal to have children or to welcome foreigners and from nothing else. On the opposite, China extraordinary growth since 1980, in a context where the population was less stagnant that it is usually reported, has coincided with the advent, at the adult age, of a whole generation, coming from a period when fecundity was higher. It must be reassessed in this context, especially when the demographic rebalancing is approaching. To assimilate countries economic records to their production growth rates and to make comparisons between them without including the demographic differences, has definitely no scientific rigor. These general considerations have a very precise importance when we look at Europe and at France in particular, about unemployment and tax and social transfers systems.

So the endless comparisons regarding employment between, on one hand Germany and Scandinavian countries, which, since one generation, had a low birthrate and France, on the opposite, which has, with Ireland, the highest birthrate in Europe, have no sense. Explanation cannot be found from economic choices. To imitate social policies, as the job market reforms adopted in Germany in 2001, which did have quite a different purpose than fighting against unemployment, would not solve our own difficulties. Harz laws had no other objective, especially the last one, that to stop the migration from the former Eastern lander to the Western ones. It was the haunting thought of social democrats because that created the risk of the lose, in favor of the right, of their bastions or to profit to the leftists. These laws didn’t have any effect on the job market in the western lander.

Relationship between growth and employment is mainly influenced by demography. It is why France needs to have a much higher growth rate than Germany to reach full employment. To apply the same rules regarding public finances is not justified. It is yet the mistake which has been made with the Lisbon Treaty which considered sacred the Maastricht criteria, on the request of Germany and Scandinavian countries belonging to the euro zone. But this demand has turned against them because ECB had to adopt an expansionist monetary policy to compensate disequilibrium caused by these criteria, which, as a consequence, put in danger, their pension systems.

This demographic denial has much more serious consequences on political and social equilibriums. Our social transfer system and or tax legislation were conceived in a quite different demographic context from the one we live with today. During the famous” Glorious Thirties”, birth deficit accumulated between the wars had generated a workforce scarcity, which made easier, during several decades, a full employment situation. That situation, later, provoked a fall in the numbers of people taking retirement. We are today in the opposite situation. The baby-boom generation arrives at the retirement age, with an extended life expectancy in the same time than we are confronted with disequilibrium in the labor market and a rise of unemployment. So there is a double pain inflicted to the following generation: a rise in social taxes provoked by the increase of the number of pensioners and difficulties to find a job. Public indebtedness finances this disequilibrium, which is said to be a third pain, since they will have to reimburse their parents debt. It is wrong because this generation will inherit a much higher wealth than that debt. But everybody will not inherit and wealth inequalities, during all these years, have increased.

How to get out of this situation, which carries heavy threats for our social and political balances? Through two ways. At the European levels, it is becoming urgent to take into account in public deficit and debt criteria, the demographic component and national saving rates which constitute a good protection against excessive indebtedness. Some are saying that Germany will put its veto. It is not sure if we convince them that it is the only way to get out of a situation which is becoming more and more unfavorable for their country: zero or negative interest rates decided by the ECB to compensate the impossibility to use budgetary policies to support growth, if they go on during a too long period, will generate a blow-up of their pension system with financial consequences by far higher than the risk created by French deficits.   

The second way is a reform of the French system of tax and social transfers. They cannot any more rely on revenues and consumption. It was understandable when the system was created, after the war, when accumulated wealth had been destroyed and all along the following years when inflation acted as a painless tax on savings. Today wealth tax and inheritance legislation comprise a mistake: they stigmatize wealth. The political leader or the party which will have found the way to convince French people to accept to take into account, in the basis of the taxes they pay, which are the counterpart of the social transfers they receive or they will receive in the future, their wealth, at every level, will have facilitated progresses in the way of a fair settlement of the conflict which is announced between generations. It will also contribute  to the reduction of the growing feeling of injustice.