Lazy Men, Where Chinese are Moving to and Energy Complications

The Interurban bike trail is located near the worldwide INTN Headquarters and the other evening while riding on it, we saw a man with a chain saw leap from one roof to another leading us to hope that “chain saw man” replaces the scary clown meme. As we continued our ride, we started to count the number of jobs that would no longer be around in five, ten, twenty years. We saw a UPS driver, taxi cab and soccer coach among many others. While counting we came to a stoplight and gazed into the upper reaches of Shoreline City Hall where we saw two lonely flip charts in a window awaiting planning of our future. We took a photo hoping to catch this symbolic moment of our uncertain times, but alas our photography skills were not up to the task. Fortunately, however, we are up to lamenting the lost generation of men, hunting down where the Chinese are moving to and contemplating the complications of energy. It’s this week’s International Need to Know, scratching “x’s” on our walls ’til election day while sneaking out important international information to the world.

Men, We Have a Problem

It is somewhat fairly well known that men’s participation in the U.S. labor force has been declining. There has even been speculation that video games and the Internet have made it easier and more fun for men to be unemployed than making a wage. Perhaps less well known is that the phenomenon of fewer men working is a problem throughout the developed world. The Federal Reserve Bank of St. Louis recently compared labor rate participation rates in seven industrialized countries with the United States going back to 1970. They found that “the labor force participation rates for prime working-age men have been falling in all of the countries.” Interestingly, in recent years Sweden, which also saw its male labor participation rates fall since 1970, has seen an increase. Why? We don’t know. But the general trend for three decades has been for men to work less. Coupled with the fact that men are less likely to go to college than women, the data on we men is not good. This phenomenon may help explain a variety of political and economic distress signals around the world. What to do about it, other than shipping our men off to Sweden (we suspect lutefisk and the opening of an ABBA Museum plays a role), we are uncertain.

Where Chinese are Moving to

I am fortunate to work with a number of Chinese investors in my business. Increasingly they not only want to invest here in the United States but also to move here. When I talk with colleagues who are also working with China, they are experiencing the same thing. Two years ago, Barclays did a survey that found that “47 percent of Chinese millionaires plan to emigrate.” I have not found an update to that study but I have no anecdotal evidence to point to an abatement of this desire. So where are Chinese moving to? The Migrant Policy Institute (they move their headquarters every year to a different country) tells us that the United States is the largest destination for Chinese migrants with just over 2 million Chinese.* South Korea is second with 751,000, followed by Canada, Japan, Singapore and Australia. What does wealthy Chinese wanting to move elsewhere say about China’s economy and political system? What does it mean for the future of China? We know one thing: for the recipient countries, history says they will benefit tremendously–just don’t tell the anti-immigration forces.

*We are excluding Hong Kong from this analysis

Energizing the World

We have detailed the ongoing solar revolution in this space, both in terms of the exponential growth in generation and new breakthroughs in storage. But we’ve often couched these breakthroughs in terms of transportation. Of course, the world uses energy for more than getting from point A to point B while making a nice stopover in Point C’s beaches and resorts. No, we use energy for all types of things, including industry, buildings and agriculture. This leads to more emissions into the atmosphere. Below you’ll see a breakdown of these emissions since 1970. Our use of energy has increased tremendously across all these sectors, including in transportation since the era of the wide necktie. The next chart shows that high income countries emissions have actually declined. And just for kicks, the last chart shows China’s outsized use of cement in the world, which is a very energy intensive industry. Evolving the world’s use of energy and emissions will be complicated, but doable, and we continue to maintain will come sooner than people think.