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As discussed in this this Wednesday’s Deep End, Britain’s economic recovery has caught a few people on the hop. What might have seemed like a permanent stagnation has been rudely interrupted.But that’s the trouble with any trend that takes hold for more than a short period: first we grow accustomed to it and then we come up with explanations as to why it could be no other way. When change does come, we not only have to abandon our old assumptions, we also have to junk our pet theories.

In a real eye-opener of an article for the Atlantic, Noah Smith introduces us to ten trends currently undergoing a radical change in direction. A prime example is Mexican immigration to the United States – which you might think is a given:

“The improving Mexican economy, lower Mexican fertility, the U.S. construction bust, and increased enforcement have combined to bring net Mexican immigration to zero or negative since 2008. That bears repeating: On net, Mexicans are no longer moving to the United States at all.”

Instead, it is Asians who are moving to America “at a rate of about half a million a year… the Asian-American percentage of the population has already reached 6%.”

Thinking about it, this seems to makes sense. After all, Asia has plenty of people to spare, right? Well, no, actually:

“In 2012, the working-age population of China fell by 3.45 million. In other words, last year China lost a number of workers approximately equal to the entire population of Lebanon. This year the drop will be bigger, and the drops will accelerate through the 2030s. That means that China’s inexhaustible supply of cheap labor is going to be exhausted a lot faster than most people expected.”

Ah, but China, with its draconian one-child policy, must be an exception. Only it isn’t. In Asia’s other giant, India, fertility rates are plummeting. In fact, in several Indian states the fertility rate is now below replacement level. So, that’s another old assumption knocked on the head.

Still, why does Asia need a growing workforce, when it can buy up the bankrupt West instead? Except that they’re not doing that either – not anymore:

“America has mortgaged ourselves to the Chinese! …Or have we? Our biggest foreign creditor, the Chinese government, is now selling U.S. bonds instead of buying them. Actually, so is our second-biggest foreign creditor, Japan. So who is buying Uncle Sam’s debt? Regular Americans like you and me. Most of the national debt is money we Americans owe to each other, not to foreigners, and this is becoming more true, not less.”

This is all very confusing – especially when it comes to policy making. How are we supposed to plan for the future if everything we know is wrong (or soon will be)?

Perhaps, instead of acting on the basis of what we know (or think we do), we should act on the basis of what we believe – which isn’t the same thing at all.

67 comments for: Heresy of the week: Everything you know is wrong – or soon will be

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