Europe, Japan and the United States epitomize the problems caused by an increasing percentage of elderly people who must be supported by a declining number of skilled workers. In 1998, Japan crossed a threshold anticipated with fear by the rest of the developed world: The point at which retirees withdrawing funds from the pension system exceeded those workers contributing to it. The elderly require higher government outlays for health care and hospitals, special housing and nursing homes, and pension and welfare assistance, but the workforce that supports these costs is dwindling. The part of the world with the largest portion of people over 65 is also the part of the world with the fewest number of people under age 15. This means that there will be fewer workers to support future retirees, resulting in an intolerable tax burden on future workers, more of the over 65 group remaining in the labor force, or pressure to change existing laws to allow mass migration to stabilize the worker/retiree ratio. No one solution is without its problems.
Worker shortage and Immigration:
For most countries mass immigration is not well received by the resident population. However, a recent report from the United Nations makes the strongest argument for change in immigration as a viable solution. The free flow of immigration will help to ameliorate the dual problems of explosive population expansion in less developed countries and worker shortage in industrialized regions. Europe is the region of the world most affected by aging and thus by a steadily decreasing worker/ retiree ratio. The proportion of older persons will increase from 20 percent in 1998 to 35 percent in 2050. The country with the largest share of old people will be Spain, closely followed by Italy, Recognizing the problem, Spain has changed immigration laws to open its borders to all South Americans of Spanish descent to keep the worker/retiree ratio from falling. Europe will need 1.4 billion immigrants over the next 50 years, while Japan and the United States will need 600 million immigrants between now and 2050. Immigrants will not help to ameliorate the problem if political and cultural opposition to immigration cannot be overcome.
The trends of increasing population in the developing world with substantial shifts from rural to urban areas, declining birthrates in the industrialized world, and global population aging will have profound effects on the state of world business and world economic conditions. Without successful adjustments to these trends, many countries will experience slower economic growth, serious financial problems for senior retirement programs, and further deterioration of public and social services, leading to possible social unrest.
World Trade Routes:
Trade routes bind the world together, minimizing distance, natural barriers lack of resources, and the fundamental differences between peoples and economies. As long as group of people in the world wants something that another group somewhere else has and there is a means of travel between the two, there is trade. Early trade routes were overland; later came sea routes, air routes, and finally some might say, the Internet to connect countries.
Trade routes among Europe, Asia and the Americans were well established by the 1500s. The Spanish empire founded the city of Manila in the Philippines to receive its silver-laden galleons bound for China. On the return trip the ship’s cargo of silk and other Chinese goods would be off loaded in Mexico, carried overland to the Atlantic, and put on Spanish ships to Spain. What we sometimes fail to recognize is that these same trade routes remain important today and that many Latin American countries have a strong relationships with Europe, Asia an the rest of the world that date back to the 1500s. The commodities traded have changed between 1500s and 2006 but trade and the trade routes continue to be important. Today, instead of offloading goods in Mexico and carrying them on mule carts overland to the Atlantic ships travel from Pacific to the Atlantic via the Panama Canal. And ships too large for the canal offload their containers onto a railroad that crosses the Isthmus of Panama to be met by another container ship.
Trade routes represent the attempts of countries to overcome economic and social imbalances created in part by the influence of geography. The majority of world trade is among the most industrialized and industrializing countries of Europe, North America, and Asia. It is no surprise that the trade flow, as seen in Maps lnk these major trading areas.