A geriatric peace: The future of U.S. power in a world of aging populations

International Security

Volumn 32, Issue 1, 2007, Pages 112-147

  Haas, Mark L ^a  

^a DUQUESNE UNIVERSITY   (United States)

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EID: 34548057516     PISSN: 01622889     EISSN: 15314804     Source Type: Journal    
DOI: 10.1162/isec.2007.32.1.112     Document Type: Article

References (149)

1. The eight states I consider to be great powers, based on a combination of current and potential military and economic power, are China, France, Germany, India, Japan, Russia, the United Kingdom, and the United States.
2. United Nations, World Population Prospects: The 2004 Revision Population Database (New York: United Nations, 2006), http://esa.un.org/ unpp/index.asp?paneI?2, select variant: medium. Throughout the article, I use the medium variant of UN population projections to avoid what some might consider overly optimistic or pessimistic assumptions. Even the medium variant, however, anticipates a significant increase in fertility rates in states that currently have very low numbers in this area.
3. Ibid.
4. Ibid.;
5. and Norimitsu Onishi, "Japan's Population Fell This Year, Sooner Than Expected," New York Times, December 24, 2005.
6. Quoted in C.J. Chivers, "Putin Urges Plan to Reverse Slide in the Birthrate," New York Times, May 11, 2006.
7. On this debate, see Stephen M. Walt, Taming American Power: The Global Response to U.S. Primacy (New York: WW. Norton, 2005). I am referring to traditional "hard" balancing, which involves direct military power and threats, not "soft" balancing, which includes such actions as withholding cooperation from the hegemon, attempting to restrict the hegemon's freedom of action through entangling diplomacy in prominent international organizations, and economically aiding the hegemon's potential enemies. On this debate
8. see Robert A. Pape, "Soft Balancing against the United States," International Security, Vol. 30, No. 1 (Summer 2005), pp. 7-45.
9. Dale C. Copeland, The Origins of Major War (Ithaca, N.Y.: Cambridge University Press, 2000);
10. and Robert Gilpin, War and Change in World Politics (Cambridge: Cambridge University Press, 1981).
11. See Christopher Layne, "Offshore Balancing Revisited," Washington Quarterly, Vol. 25, No. 2 (Spring 2002), pp. 233-248.
12. For a partial exception, see Michael Mandelbaum, The Case for Goliath: How America Acts as the World's Government in the Twenty-first Century (New York: PublicAffairs, 2005), pp. 182-186.
13. Russia is an exception to this trend among the great powers. For details why, see Nicholas Eberstadt, "Russia's Demographic Straightjacket," SAIS Review, Vol. 24, No. 2 (Summer-Fall 2004), pp. 9-25.
14. On the ineffectiveness of states' attempts to raise fertility rates, see Paul Demeny, "Policy Interventions in Response to Below Replacement Fertility," Population Bulletin of the United Nations, Nos. 40/41 (1999), pp. 183-193.
15. For details, see United Nations Population Division, Replacement Migration: Is It a Solution to Declining and Ageing Populations? (New York: United Nations Secretariat, March 21, 2000), pp. 24, 26, http://www.un.org/esa/ population/publications/migration/migration.htm.
16. A study published by the Organization for Economic Cooperation and Development (OECD) predicts that reductions in the workforces in the EU and Japan due to population aging will result in nearly a 1 percent reduction in GDP growth per year from 2025 to 2050, ceteris paribus. See David Turner, Claudio Giorno, Alain de Serres, Ann Vourc'h, and Peter Richardson, "The Macroeconomic Implications of Aging in a Global Context," Working Paper, No. 193 (Paris: Economics Department, OECD, 1998), p. 47.
17. According to another set of calculations, expansion in China's working-age population since the mid-1970s has added roughly 2 percent per year to Chinese GDP growth. Shrinkage in this demographic group will result in a loss of 1 percent per year from GDP growth by the 2020s. See Richard Jackson, "Population Aging in China: An Assessment of the Economic, Social, and Political Risks," paper prepared for the Eurasia Group China Task Force meeting, New York, New York, October 28, 2005, p. 4.
18. Despite being the second youngest of the great powers today (trailing only India), China is already experiencing labor shortages that are threatening its economic growth. These shortages are due in large part to the aging of China's population and reductions in the number of 15-to-35-yearolds. See David Barboza, "Sharp Labor Shortage in China May Lead to World Trade Shift," New York Times, April 3, 2006;
19. and Howard W. French, "As China Ages, Shortage of Cheap Labor Looms," New York Times, June 30, 2006.
20. An aging population does not necessarily translate into labor force reductions if people continue to work past 65. Most retirement ages in the industrialized world, however, remain well below this number, and people have been resistant to changing them. Among industrialized great powers, only Japan (34 percent) and the United States (18 percent) have more than 10 percent of men older than 65 participating in the labor force. In France only 2 percent of this age group does so, and in Germany only 5 percent does. OECD, Labour Force Statistics (Paris: OECD, 2006).
21. One study calculates that with shrinking workforces (based on the low variant of UN demographic projections) and a 1.5 percent growth in overall economic productivity per year (which is slightly higher than the European average during the last decade of 1.3 percent), GDP growth in the next forty years will average 1.25 percent in France, 1 percent in Germany, and 0.5 percent in Japan. "Baby Boomers' Poverty Trap," Lombard Street Research, Monthly Economic Review, September 22, 2003, available from Lexis-Nexis Academic. For context, from 1975 to 1985, the Soviet Union averaged less than 2 percent GDP growth. This rate is widely viewed as a key contributing factor to its eventual geopolitical collapse.
22. The Japanese government has already reported that national savings rates are down substantially from previous levels due to social aging and seniors' consumption of their savings. See "Savings Rate Slides as Population Ages," Yomiuri Shimbun, October 29, 2003.
23. On these points, see Robert Stowe England, The Macroeconomic Impact of Global Aging: A New Era of Economic Frailty? (Washington, D.C.: Center for Strategic and International Studies, 2002).
24. This is particularly true for the industrialized great powers (France, Germany, Japan, the United Kingdom, and the United States) and Russia, all of which possess universal welfare systems for elderly care (at varying benefit levels). The Chinese and Indian governments are formally committed, to the welfare of a relatively small percentage of their elderly populations (roughly 15 to 20 percent). Even these percentages, however (which are likely to increase in the future), translate into very high numbers of seniors due to these states' huge populations.
25. For details, see Central Intelligence Agency (CIA), "Long-Term Global Demographic Trends: Reshaping the Geopolitical Landscape," July 2001, p. 27, https://www.cia.gov/cia/reports/Demo_Trends_For_Web.pdf; Richard Jackson
26. The Global Retirement Crisis: The Threat to World Stability and What to Do about It (Washington, D.C.: Center for Strategic and International Studies, 2002), p. 22;
27. and Peter G. Peterson, Gray Dawn: How the Coming Age Wave Will Transform America -and the World (New York: Times Books, 1999), p. 45.
28. Richard Jackson and Neil Howe, The 2003 Aging Vulnerability Index: An Assessment of the Capacity of Twelve Developed Countries to Meet the Aging Challenge (Washington, D.C.: Center for Strategic and International Studies, 2003), p. 7.
29. See also Peterson, Gray Dawn, p. 18;
30. Organization for Economic Cooperation and Development, "Fiscal Implications of Global Ageing: Projections of AgeRelated Spending," OECD Economic Outlook, June 2001, http://www.oecd.Org/dataoecd/1/22/2085481.pdf; and Jackson, The Global Retirement Crisis, pp. 4, 84-91.
31. This assumes that large numbers of new workers are not added into the system through significantly rising fertility or immigration rates. States can also pay for the costs of social aging in the coming decades if productivity gains are high enough to create a sufficiently expanding economy. Trying to pay for the costs of aging through productivity growth, however, often has critical flaws. Most public pension systems tie retirement benefits to wages. This means that as wages rise due to productivity increases, so, too, will obligations to the elderly. Higher productivity and thus higher wages also translate into higher medical care costs, which is a labor-intensive industry. Productivity growth thus increases the fiscal burden created by social aging while making it easier to pay for some of these costs.
32. For details, see OECD statistics from Jeffrey Owens and Mary Bennett, "An International Perspective on U.S. Tax Reform and OECD Work to Promote International Tax Standards," Tax Foundation/Congressional Staffers Briefing, June 5, 2006, http://www.taxfoundation.org/files/owensustaxreform- 22060605.pdf.
33. CIA, "Long-Term Global Demographic Trends," p. 26.
34. For details, see Jackson and Howe, The 2003 Aging Vulnerability Index, p. 11.
35. Japan's debt is already 158 percent of GDP. Central Intelligence Agency, The World Factbook, "Guide to Country Profiles," 2005 statistics, https://www.cia.gov/cia/publications/factbook/index.html.
36. Peterson, Gray Dawn, p. 72.
37. A 2004 study by Standard & Poor's predicted that Germany's debt could rise to 300 percent of GDP in coming years, primarily due to the effects of its rapidly aging population. This level of debt is associated with economies whose obligations are accorded junk-bond status in financial markets. David Smith, "Germany Heads for 'Junk' Status," Sunday Times (London), August 15, 2004.
38. Retirement Confidence Survey (RCS), "Saving for Retirement in America," 2005 RCS Fact Sheet, 2005 Retirement Confidence Survey (Washington, D.C.: Employment Benefit Research Institute, 2005), p. 2, http://www.ebri.org/pdf/surveys/rcs/2005/RCS05.FS.No2.SavInAm.Final.24Mar.pdf.
39. Silvia Ascarelli, "Study Finds Europeans Are Poor Savers Who Don't Tend to Change Their Habits," Wall Street Journal Europe, June 28, 2001, quoted in Jackson, The Global Retirement Crisis, p. 43.
40. Peterson, Gray Dawn, p. 36.
41. Jackson and Howe, The 2003 Aging Vulnerability Index, p. 13.
42. Ibid., pp. 13, 16.
43. Steven Lee Myers, "Mounting Discontent in Russia Spills into the Streets," New York Times, February 12, 2005;
44. and "Pensions Raised in Russia for Almost 40 Million People," Itar-Tass news agency, April 1, 2006. Russia's leaders were able to reduce pension benefits in the early to mid1990s by adopting highly inflationary monetary policies. Since this time, however, Russian pensioners have become increasingly assertive in the political arena, and pensions have been a significant issue in every Russian election since 1995. As a result, the Russian national government has repeatedly increased pension benefits since 1997, including passing a law the same year that indexed benefits to inflation. Andrea Chandler, Shocking Mother Russia: Democratization, Social Rights, and Pension Reform in Russia, 1990-2001 (Toronto: University of Toronto Press, 2004), pp. 10, 72, 80, 95, 109, 119, 133, 137-138, 149, 151, 155.
45. Robert Stowe England, Aging China: The Demographic Challenge to China's Economic Prospects (Westport, Conn.: Praeger, 2005), pp. 89-90, 94;
46. and Phillip Longman, The Empty Cradle: How Falling Birthrates Threaten World Prosperity and What to Do About It (New York: Basic Books, 2004), p. 55.
47. People's Republic of China (PRC), "China's Social Security and Its Policy," Social Security White Paper (Beijing: Information of the State Council of the PRC, September 2004), p. 2, http://unpan1.un.org/intradoc/groups/ public/documents/APCITY/UNPAN019944.pdf.
48. Office of Policy, "Recent Developments in Foreign Public and Private Pensions," International Update (Washington, D.C.: Social Security Administration, 2004), http://www.socialsecurity.gov/policy/docs/progdesc/ intl_update/2004-10/2004-10.html. The more liberalization proceeds in China and Russia, the greater the difficulty these states' leaders will have in cutting funding for elderly care. To the extent that high levels of welfare spending on seniors is likely to inhibit significant increases in military expenditures, the United States has reason to support political liberalism in these states in addition to predictions based on democratic peace theory.
49. Richard Jackson, "The 'State of the Art' in Entitlement Reform: Lessons from Abroad," Facing Facts Quarterly, Vol. 2, No. 1 (Winter 2006), p. 2.
50. "S&P Says Aging Populations Could Hit G7 Ratings," Financial Times, May 28, 2005.
51. Jackson, "The 'State of the Art' in Entitlement Reform."
52. Richard Jackson, "Perspectives on Japan's 2004 Public Pension Reform," paper presented at the International Conference on Social Security Reform, Washington, D.C., February 24, 2006.
53. "German Cabinet to Up Retirement Age to 67 from 65 in 2029," AFX News Limited, February 1, 2006.
54. Andrew Taylor, "Aging Populations Threaten to Overwhelm Public Finances," Financial Times, October 11, 2005, p. 12;
55. "Japan's Economy to Be Hit Hard, by Aging Society: IMF," Kyodo News Service, September 23, 2004; "EU Commission Says Governments Must Lower Debt Levels to Cope with Aging," AFX News Limited, December 21, 2000; and "IMF Urges French to Mount Broad-Ranging Reforms," AFX News Limited, July 30, 2002.
56. Organization for Economic Cooperation and Development, "Economic Survey of Japan, 2005: Achieving Fiscal Sustainability," http://www.oecd.org/document/53/0,2340,en_2649_201185_34287541_1_1_1_1,00.html.
57. Population aging, in other words, helps explain contemporary variations among the great powers in both defense spending trends and the relative amount of resources dedicated to different types of military expenditures (e.g., money for active personnel, pensions, or weapons purchases). Great powers that are currently experiencing high levels of aging crisis (France, Germany, Japan, and Russia) are either reducing their military spending levels, shifting more resources within their military budgets to personnel and pension costs and away from weaponry, or doing both. Great powers whose aging crises are either delayed for several decades (China and India) or comparatively low (Britain and the United States) are increasing their military spending levels or spending relatively more within these budgets (especially compared to France, Germany, Japan, and Russia) on weapons and research and development than on personnel and pensions, or are engaged in both activities.
58. Stockholm International Peace Research Institute (SIPRI), "The 15 Major Spender Countries in 2005," http://www.sipri.org/contents/milap/ milex/mex_major_spenders.pdf. These figures are measured in terms of purchasing power parity.
59. If states are willing both to allow high levels of poverty among their seniors and to adopt conscription to keep down military personnel costs, then social aging need not dramatically affect defense expenditures. Politicians, though, will find these choices difficult to implement and maintain. Thus the most likely outcome created by high levels of aging is either a reduction or at most the preservation of existing power projection capabilities.
60. UN, World Population Prospects. China's aging dilemma is likely to be even more dire than some predictions indicate due to a problem of "surplus men" resulting from the widespread selection of male over female babies. According to some estimates, China in 2000 had more than 40 million fewer women than it would have had if sex ratios were determined naturally. The fewer women today, the fewer babies in the future, and thus the more quickly a society will age. India has a similar problem, with an estimated 37 million "missing women" in 2001.
61. See Valerie M. Hudson and Andrea Den Boer, "A Surplus of Men, A Deficit of Peace: Security and Sex Ratios in Asia's Largest States," International Security, Vol. 26, No. 4 (Spring 2002), pp. 5-38, statistics from p. 9.
62. UN, World Population Prospects.
63. Ibid.
64. Even if China's economy continues to grow in coming decades at rates similar to those it has experienced in recent years, by 2035 its median age will reach the levels of France, Germany, and Japan today, but at GDP per capita levels significantly lower than these states currently possess. See Nicholas Eberstadt, "Growing Old the Hard Way: China, Russia, India," Policy Review, No. 136 (April-May 2006), http://www.hoover.org/publications/ policyreview/2912391.html. Consequently, even though China's current taxation rates and deficit levels are low compared with those of the other great powers, when China's aging crisis hits with full force the country will, at best, confront similar economic and fiscal constraints as France, Germany, and Japan do today.
65. England, Aging China, pp. xiii, 50;
66. and Longman, The Empty Cradle, p. 55.
67. Richard Jackson and Neil Howe, The Graying of the Middle Kingdom: The Demographics and Economics of Retirement Policy in China (Washington, D.C.: Center for Strategic and International Studies, 2004);
68. England, Aging China, p. 69;
69. and Noriyuki Takayama, "Pension Reform of PRC: Incentives, Governance, and Policy Options," paper prepared for the Fifth Anniversary Conference on Challenges and the New Agenda for the People's Republic of China, Asian Development Bank, Tokyo, Japan, December 5-6, 2002, p. 16.
70. Takayama, "Pension Reform of PRC," p. 16.
71. England, Aging China, pp. 87, 89, 91;
72. Longman, The Empty Cradle, pp. 55-56;
73. Kong Jingyuan, "Implicit Pension Debt and Its Repayment," in Wang Megnkui, ed., Restructuring China's Social Security System (Beijing: Foreign Languages Press, 2002), p. 183;
74. Gordon G. Chang, "The Pension Money Is Running Out: Social Security in China," International Herald Tribune, July 18, 2002;
75. and CIA, World Factbook, 2005 statistics.
76. See Howard W French, "Rush for Wealth in China's Cities Shatters the Ancient Assurance of Care in Old Age," New York Times, November 3, 2006.
77. Joe C.B. Leung, "Family Support and Community Services for Older Adults in China: Integration and Partnership," in Hyunsook Yoon and Jon Hendricks, eds., Handbook of Asian Aging (Amityville, N.Y.: Baywood, 2006), pp. 413-415.
78. UN, World Population Prospects.
79. H.B. Chanana and. P.P. Talwar, "Aging in India: Its Socio-economic and Health Implications," Asia-Pacific Population Journal, Vol. 2, No. 3 (September 1987), p. 35.
80. Rajagopal Dhar Chakraborti, The Graying of India: Population Ageing in the Context of Asia (New Delhi: Sage, 2004), p. 273;
81. and Indira Jai Prakash, Ageing in India (Geneva: World Health Organization, 1999), p. 9, http://whqlibdoc.who.int/hq/1999/WHO_HSC_AHE_99.2. pdf.
82. S. Vijay Kumar, "Economic Security for the Elderly in India: An Overview," in Phoebe S. Liebig and S. Irudaya Rajan, eds., An Aging India: Perspectives, Prospects, and Policies (Binghamton, N.Y.: Haworth, 2003), p. 47.
83. For details, see Chakraborti, The Graying of India, pp. 278, 280-281, 374; Chanana and. Talwar, "Aging in India," p. 36;
84. and World Bank, India: The Challenge of Old Age Income Security, Report No. 22034-IN (Washington, D.C.: Finance and Private Sector Development, 2001).
85. Eberstadt, "Growing Old the Hard Way," p. 12.
86. World. Bank, "GNI Per Capita 2005, Atlas Method and PPP," World Development Indicators Database. (Washington, D.C: World Bank, 2006), http://siteresources.worldbank.org/DATASTATISTICS/Resources/GNIPC.pdf.
87. Eberstadt, "Growing Old the Hard Way," p. 12.
88. UN, World Population Prospects.
89. Jackson and Howe, The 2003 Aging Vulnerability Index, p. 7.
90. CIA, World Factbook, 2005 statistics.
91. Eberstadt, "Russia's Demographic Straightjacket," p. 9.
92. For details, see Cynthia Buckley and Dennis Donahue, "Promises to Keep: Pension Provision in the Russian Federation," in Mark G. Field and Judyth L. Twigg, eds., Russia's Torn Safety Nets: Health and Social Welfare during the Transition (New York: St. Martin's, 2000), p. 265.
93. Eberstadt, "Growing Old the Hard. Way," p. 11. It may seem paradoxical that Russia is rapidly aging at the same time that life expectancy is declining. This is not an error: population age is much more a product of fertility than mortality rates.
94. James Brooke, "Japan's New Military Focus: China and North Korea Threats," New York Times, December 11, 2004.
95. "Japanese Government Approves Smaller FY2006 Budget," Xinhua news service, December 24, 2005.
96. "30% Cut in Spending Needed to Balance Japan's Finances in 10 Years," Japan Economic Newswire, May 16, 2005; and "Government Eyes 25% Spending Cuts to Balance Finance in FY 2011," Japan Economic Newswire, January 18, 2006.
97. Aoife White, "EU: Germany Must Stick to Spending Cuts to Reduce Budget Deficit by End of 2007," Associated. Press, March 1, 2006.
98. Craig S. Smith, "German Military Ranks as NATO Laggard," International Herald Tribune, March 19, 2003.
99. Stockholm International Peace Research Institute, "SIPRI Military Expenditure Database," http://first.sipri.org/non_first/miIex.php. Unless stated otherwise, military spending figures from both SIPRI and NATO sources include spending on military pensions.
100. Ibid.
101. Office of the Prime Minister, France, "1st National Conference on Public Finance," press release, January 16, 2006, http://www.premier- ministre.gouv.fr/en/information/latest-news_97/1st-national-conference-on_55114. html.
102. SIPRI, "SIPRI Military Expenditure Database."
103. International Institute for Strategic Studies (IISS), The Military Balance, 2002-2003 (London: IISS, 2002), p. 276;
104. and International Institute for Strategic Studies, The Military Balance, 2006-2007 (London: IISS, 2006), p. 152.
105. Jackson and Howe, The 2003 Aging Vulnerability Index;
106. Peterson, Gray Dawn, pp. 68-69;
107. and Jackson, The Global Retirement Crisis, pp. 55-57.
108. Jackson and Howe, The 2003 Aging Vulnerability Index, p. 7. Probably Britain's most important pension reform occurred in the early 1980s, when pension benefits were decoupled from wages. Thus when individuals earn more due to productivity gains, they are not promised proportionally higher retirement benefits. In this system, government revenues increase more than retirement obligations. On health care, only Japan spends less per capita than Britain among the industrialized great powers. Organization for Economic Cooperation and Development, "Total Health Expenditure Per Capita, U.S.$ PPP," OECD Health Data, 2006, http://www.oecd.org/ dataoecd/60/27/35529803.xls.
109. CIA, World Fadbook, 2005 statistics.
110. For details, see SIPRI, "SIPRI Military Expenditure Database."
111. Jackson and Howe, The 2003 Aging Vulnerability Index, p. 7.
112. Quoted in Richard Wolf, "A 'Fiscal Hurricane' on the Horizon," USA Today, November 14, 2005.
113. Jonathan Weisman, "Aging Population Poses Global Challenges: Health Care, Other Rising Costs to Strain Budgets in U.S. and Abroad," Washington Post, February 2, 2005.
114. OECD, "Total Health Expenditure Per Capita"; and CIA, World Factbook, "Guide to Rank Order Pages," 2007 statistics.
115. Wolf, "A 'Fiscal Hurricane' on the Horizon."
116. Jackson and Howe, The 2003 Aging Vulnerability Index, pp. 19-20.
117. Laurence J. Kotlikoff and Scott Burns, The Coming Generational Storm: What You Need to Know about America's Economic Future (Cambridge, Mass.: MIT Press, 2004), pp. 35, 17.
118. See also ibid., pp. 1, 39, 100-101.
119. These authors rely heavily on a 2002 study commissioned by the U.S. Treasury Department that calculates the present value of the unfunded senior care liability in the United States at an astronomical $51 trillion, $44 trillion of which is for Medicare. Ibid., pp. 65-71, 163. Most other studies put these figures much lower, though they remain extremely high.
120. These projections are based on the continuation of current U.S. fertility and immigration rates. Neither should be taken as inevitable, however. The spread of antinatal cultural values, such as secularism, materialism, and individualism, may push down U.S. fertility rates toward those exhibited throughout the rest of the industrialized world. Furthermore, not only is the U.S. political climate becoming more hostile to immigration, but population aging in the industrializing world, including Latin America, is resulting in fewer emigrants from these countries.
121. In 1999 the United States' funded pension assets totaled 84 percent of GDP, which is one of the highest percentages in the world. Germany's funded pension assets at this time totaled 7 percent of GDP, and France's 5 percent. See Maureen M. Culhane, Global Aging: Capital Market Implications (New York: Goldman Sachs, 2001), p. 14.
122. For details, see Peterson, Gray Dawn, pp. 79-80;
123. and. Richard. Jackson, Germany and the Challenge of Global Aging (Washington, D.C.: Center for Strategic and International Studies, 2003), p. 3.
124. See Sveinbjörn Blöndal and Stefano Scarpetta, "The Retirement Decision in OECD Countries," Working Paper, No. 202 (Paris: Economics Department, OECD, 1999), pp. 82, 90, http://www.oecd.org/dataoecd/36/ 30/1866098.pdf;
125. and Organization for Economic Cooperation and Development, "Gross Domestic Product in OECD Countries, at Constant Price, in Millions of National Currency," OECD Productivity Database, July 2005, http://www.oecd.org/dataoecd/30/13/29860000.xls, "Average Hours Worked" tab.
126. See Owens and Bennett, "An International Perspective on U.S. Tax Reform and OECD Work to Promote International Tax Standards."
127. See Barry R. Posen, "Command of the Commons: The Military Foundation of U.S. Hegemony," International Security, Vol. 28, No. 1 (Summer 2003), pp. 5-46.
128. Personnel spending in these ratios includes pension costs.
129. European Defence Agency, An Initial Long-Term Vision for European Defence Capability and Capacity Needs (Brussels: European Defence Agency, 2006), p. 6, http://ue.eu.int/ueDocs/cms_Data/docs/pressdata/EN/reports/91135. pdf.
130. People's Republic of China, "Chapter IV: Defense Expenditure and Defense Assets," White Paper on National Defense, 2004, http://www.fas.org/nuke/guide/china/doctrine/natdef2004.html;
131. and People's Republic of China, "Chapter IV: National Defense Building; Defense Expenditure," White Paper on National Defense, 2002, http://www.china.org.cn/e-white/20021209/.
132. IISS, The Military Balance, 2006-2007, p. 152.
133. Industry Canada, International Market Research Report, http://strategis.ic.gc.ca/epic/internet/inimr-ri.nsf/en/grl25657e.html, 2004 statistics.
134. PRC, "Chapter IV: Defense Expenditure and Defense Assets."
135. Girja Shankar Kaura, "Defense Gets Rs 6,000-cr Hike," Tribune News Service, February 28, 2006. Consistent with the preceding analysis describing the relatively low level of Britain's aging crisis, the United Kingdom spends less than 8 percent of its total defense budget on pensions. Ministry of Defence, The Government's Expenditure Plans, 2002-2003 to 2003-2004, July 2002, p. 20, http://www.mod.Uk/NR/rdonlyres/011F6D00-DA90- 4B1C-84EA-789073F83287/0/gep_0203to0304_cm5412.pdf, 2003-04 statistics.
136. Cindy Williams, "Making the Cuts, Keeping the Benefits," New York Times, January 11, 2005.
137. Office of Management and Budget (OMB), "Historical Tables," Budget of the United States Government: Fiscal Year 2007 (Washington, D.C.: Government Printing Office, 2006), Table 11.3, 2006 statistics, http://www.whitehouse.gov/omb/budget/fy2007/pdf/hist.pdf, p. 228.
138. SIPRI, "The 15 Major Spender Countries in 2005."
139. Overall military spending for the United States is from OMB, "Historical Tables," 2006 statistics, p. 78.
140. IISS, The Military Balance, 2006-2007, pp. 398, 400.
141. Solomon M. Karmel, "The Maoist Drag on China's Military," Orbis, Vol. 42, No. 3 (Summer 1998), pp. 375-386.
142. Ibid., p. 386.
143. The RAND Corporation predicts that by 2025, China will be spending 1.6 times as much on personnel than on weapons and military research and development, and 44 percent of its total military budget on the former. Keith Crane, Roger Cliff, Evan Medeiros, James Mulvenon, and William Overholt, Modernizing China's Military: Opportunities and Constraints (Santa Monica, Calif.: RAND, 2005), pp. 233-234. China currently spends roughly one-third of its budget on personnel, which is slightly less than the percentage dedicated to weaponry.
144. For details and sources, see Pape, "Soft Balancing against the United States."
145. For extensive analysis of the United. States' global interests and policies, see Mandelbaum, The Case for Goliath.
146. Francis Fukuyama, State-Building: Governance and World Order in the 21st Century (Ithaca, N.Y: Cornell University Press, 2004).
147. For studies that provide extensive policy recommendations to minimize the burdens of social aging, see Longman, The Empty Cradle;
148. Peterson, Gray Dawn;
149. and Kotlikoff and Burns, The Coming Generational Storm.