Russia, the sick man of Europe

Public Interest, Wntr, 2005 by Nicholas Eberstadt

Skeptics might argue that health does not seem to be constraining Russia's economic progress today--recorded growth rates, after all, have been high for the past several years. Perhaps poor health will not overly constrain Russian economic development in the years ahead, since Russia can earn large dividends from the exploitation and sale of its abundant natural resources. But Russia's dependence upon extractive industries only emphasizes just how limited the role of "human capital" is in Russia's current international trade profile.

Russia's poor health prospects, furthermore, stand to influence its economic potential far into the future. According to year 2000 survival schedules, for example, a 20-year-old Russian youth had only a 46 percent chance of reaching age 65 (compared with a 79 percent chance for an American counterpart). That discrepancy will surely affect the cost-benefit calculus of investments in education and job training--and not to the benefit of Russia's younger generation or its overall economic outlook.

In the short run, the collapse of Russian fertility may have little practical (as opposed to psychological) import for daily life or affairs of state. If, however, extreme subreplacement fertility persists, current and continued childbearing patterns would directly shape the Russian future. In some nontrivial respects, it could materially limit Russian national options. In the decades immediately ahead, for example, Russia looks set to contend with a sharp fall-off in the nation's youth population. Between 1975 and 2000, for example, the number of young men aged 15 to 24 ranged between 10 million and 13 million--but by 2025, in current UNPD projections, the total will be down to barely 6 million. Those figures would imply a 45 percent decrease between 2000 and 2025 in the size of this pivotal population group--as compared with a projected 15 percent decline in Russia's overall population.

The military implications of the envisioned disproportionate shrinkage of the age group from which the Russian army draws its manpower are obvious enough. But there would also be serious economic and social reverberations. With fewer young people rising to replace older retirees, the question of improving (or perhaps maintaining) the average level of skills and qualifications in the economically active population would become that much more pressing. And since younger people the world over tend to be disposed toward, and associated with, innovation and entrepreneurial risk-taking, a declining younger population could have intangible, but real, consequences.

In a world of still-growing populations and generally improving health conditions, Russia would seem to face an uphill struggle. Between 2000 and 2025, by UNPD medium variant projections, Russia's share of total global population is envisioned as shrinking by a third, from 2.4 percent to 1.6 percent. Over the same period, improvements in Russia's life expectancy are expected to under-perform the global average somewhat. Simply to maintain its share of world output, Russia's per capita economic growth would have to exceed the world's average by 1.6 points a year for the quarter century under consideration to compensate for relative population decline. To some important extent, a country's relative economic potential limits its international political influence and its international security. Russia's demographic prospects thus establish an obvious challenge for the nation over the coming generation. Can it avoid, through compensatory economic policies and foreign policy stratagems, the geopolitical marginalization to which demographic trends alone would seem to consign it?