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China’s policy choices have ultimately resulted in the situation that the nation currently faces: a nation with a rapidly aging demographic with an increasing dependency ratio that can eventually cripple the country economically if measures are not taken to stem their breakneck pace. Compounding the issue is that China’s traditional social welfare has held long in history the untold responsibility that the younger generation will be caring for their elders. However, the ramifications of their current status, of the aging population outpacing the younger working population, indicate that change needs to occur because the old methods of addressing the social and economic problems of their rapidly aging demographics will not suffice. In order to address some of these issues, it’s necessary to first identify a couple of key policies and issues that helped usher China into its current predicament.
Historically, China had been reaping the rewards of its low dependency ratio for many years. According to a June 2009 article of the, the 1980’s brought a decade of success and expected good pension due to the implementation of the one child policy and the Iron Rice Bowl care system that provided cradle to grave benefits.
The one child policy implemented in 1978 to ease some of the social and economic burdens during that time led to, currently, one of the lowest fertility ratios in the world. What does this mean? The low dependency ratio,...