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     Aug 27, '13

Egypt a preview of our future
By Martin Hutchinson

Egypt's crisis may appear to exemplify the bad ways of the past, with an authoritarian military regime vying for power with a fanatical religious sect. However that analysis doesn't explain why the country had previously existed for hundreds of years in reasonable contentment - as well as, millennia earlier, producing the first of the world's great civilizations.

When you look at Egypt's demographic and economic position and recent history, it becomes clear that it has become economically both doomed and ungovernable - and that its woes may symbolize, not the evils of the past, but those of the 22nd century that our descendants may all face.

In 1913, Egypt was a relatively wealthy country, richer than Brazil

with GDP per capita (according to the Angus Maddison data set) of 59% of the world average - though according to Maddison it had enjoyed GDP per capita of 129% of the world average in AD 1, a tribute to the sound economic management of Cleopatra and her ancestors.

It then became steadily more impoverished until the 1970s, with GDP per capita declining even in absolute terms until the 1950s and relatively bottoming out at 32% of the world average in 1974. Under Anwar Sadat and Hosni Mubarak, with Egypt now located in a region of immense oil wealth and with global tourism a booming industry, its fortunes improved, and in 2003, the last year of the available Maddison data set, its GDP per capita was 46% of the world average.

When you look more closely however, the Egyptian economy today appears unsustainable. Egypt's budget deficit was 11% of GDP in 2012, while its imports were more than double its exports, leaving a payments deficit of around 12% of GDP - and foreign reserves of only two months' imports. With unrest likely to persist even if it is controlled, Egypt's tourism business looks to be in a long-term crisis that makes the country's prospects gloomy indeed.

Egypt's major problem, quite simply, is population. In 1913 Egypt had a population of about 12 million. Today that population is 85 million, growing at almost 2% annually. Historically, Egypt was one of the world's great granaries, with the Nile Delta being the main grain supplier for the Roman Empire and Egypt still exporting grain in 1913.

Today the country imports a high percentage of its food needs, and that import percentage is growing. Although Egypt is a large country, with only moderate population density, only a small percentage of the land is arable, and thus even with modern agricultural methods the country has far outstripped its food production capacity.

With such rapid population growth, Egypt is unable to educate its population properly or to find jobs for them. Only 74% of the population is literate, probably a lower percentage than in 1913, while education spending per capita is among the world's lowest. With the tourism sector affected by the combination of Islamism and unrest, there are also no jobs for the myriad of youths who reach adulthood annually - unemployment is now 25% and rising. It's thus not surprising that street agitation is endemic, as are assaults upon unpopular groups such as the unfortunate Coptic Christians.

This is not particularly a failure of Egypt's governments over the last century, nor is it a result of religion - Malaysia and Indonesia, both majority Moslem but with substantial non-Moslem minorities, have both done pretty well in the last few decades. Indeed, before the 20th century, Islamic societies were generally more tolerant than Christian ones.

Henry St. John, Viscount Bolingbroke, writing in the "Craftsman" No. 17 in 1727, wrote that paradoxically, although Moslem teachings, unlike Christianity, preach militancy, "we seldom hear of any Persecutions set on Foot in those Countries on a religious Account, nor do we find in their Histories any great Massacres, Crusades, and consecrated Butcheries committed there, for the Propagation of their Faith, since the first Establishment of it by those Measures."

One hundred or even 50 years ago, Egypt was a relatively tolerant society; it has become intolerant as a result of its mass of surplus underemployed youth and its dearth of worthwhile employment. That in turn, is a product of the birth rate, which has octupled the country's population in the last century and created in Cairo a seething mega-city that even for the rich is thoroughly unpleasant.

Regardless of the future trajectory of Islamism, Egypt's population problem is likely to be shared by many countries by 2100, if current UN population projections are correct. According to the UN's "medium variant" population projections, by 2100, when global population will have increased by 51% to 10.85 billion, Nigeria will have a population of 914 million, up from 174 million in 2013, while its neighbors Niger and Mali will have populations of 204 million and 101 million, up from 18 million and 15 million respectively.

The good news is that, with Japan's population down to 84 million from its current 128 million, there will no longer be any overcrowding on the Tokyo subway. The bad news is that metropolitan Lagos, currently with a population of 17.9 million, will by 2100 have a population of 93 million even if no further Nigerian urbanization occurs.

Can anyone imagine the experience of living in a relatively poor city, with doubtless mediocre and overstretched infrastructure, with 93 million people, and a population density of some 100,000 persons per square kilometer, five times the current level. By 2100 we may have rocket ships to Mars or even Alpha Centauri, but I bet the air conditioning systems in that year's Lagos will be only intermittently functional.

While the world's overall population projection for 2100 may look tolerable, that for poor countries definitely is not. Mali's 101 million citizens and Niger's 204 million, living in countries most of whose land area has negligible rainfall, will have severe water and food availability problems.

As for Nigeria's 914 million citizens crammed into an area smaller than today's Egypt, their access to resources of any kind will be minimal. Needless to say, whatever the religious proclivities of their populations, conflict is inevitable and progress towards a decently wealthy society very unlikely indeed.

Overpopulation, not global warming or even disease eradication, is thus the key economic development priority of our time. The rich world can clearly handle the UN population growth projections, which in the medium case have "more developed regions" populations rising only from 1,253 million in 2013 to 1,284 million in 2100. However the poorest "least developed regions" according to the UN will see population rise from 898 million in 2013 to a "medium variant" projection of 6,642 million in 2100.

It is additionally worrying that the UN projections may well be too low; a decade ago they blissfully projected global population peaking around 2047 at 9 billion and then beginning to decline, whereas today's projections show no end in sight to its inexorable rise. Indeed, the UN's "constant fertility" projection, which assumes excessive poor country fertility and modern medicine, suggests a world population of an appalling 28.6 billion in 2100, more than double the medium variant projection.

That's probably too pessimistic; it assumes the welcome declines in fertility we are seeing in middle income countries will go no further. Still even the UN's medium variant is a thoroughly unattractive prospect, and the risks are on the upward (pessimistic) side of that projection.

You don't have to be a global warming alarmist to see that a world of 10.85 billion people, with all but the poorest countries enjoying full access to Western levels of gadgetry and power usage, will have great environmental difficulty, even if only the minimalist projections of carbon emissions' effect on global warming are correct.

However, given that the most pessimistic carbon forcing models appear to be bunkum, any global warming that occurs can be put down, not to our technology, which becomes cleaner all the time, but to our excessive tendency to breed, which is also reducing all the time, but not quickly enough.

As discussed earlier this year, I am relatively optimistic about US growth in the 21st century; I do not believe technological development has halted, nor productivity growth. I also believe the current relative growth malaise to be the result of very foolish monetary, fiscal and regulatory policies that can and probably will be reversed.

Nor am I a pessimist about global warming; while I believe it likely our emissions of carbon dioxide have some long-term warming effect on the atmosphere, I believe that effect to be considerably less than postulated in the more alarmist models, and to be in any case asymptotic, so that the next 10% of carbon dioxide in the atmosphere has a smaller effect than the last 10%.

However I believe global population growth to be a very serious problem indeed, the more so because it will be concentrated in countries too poor to adapt effectively to it. Modern medicine has arrived in those countries long before modern reproductive rates or modern living standards, and the effect is to elevate artificially the population growth rate. As we are seeing in Egypt, rapid population growth, once it comes up against the carrying capacity of the local environment, produces very unpleasant effects both economic and social.

Even if in 2100 we are able to protect ourselves economically and militarily against the overcrowding of the impoverished, we have a responsibility not to allow such misery to occur. Of all development priorities, this is the most important.

Gross domestic product (GDP) is a broad measure of the economy that measures the retail value of goods and services produced in a country.

Martin Hutchinson is the author of Great Conservatives (Academica Press, 2005) - details can be found on the website www.greatconservatives.com - and co-author with Professor Kevin Dowd of Alchemists of Loss (Wiley, 2010). Both are now available on Amazon.com, Great Conservatives only in a Kindle edition, Alchemists of Loss in both Kindle and print editions.

(Republished with permission from PrudentBear.com. Copyright 2005-13 David W Tice & Associates.)

When hunger came to Egypt (Apr 15, '13)



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