The Draghi Report has sparked a vital conversation about Europe’s future, bringing the continent’s economic development to the centre of public debate. While the report covers important economic issues, it overlooks one of the most pressing concerns: the ongoing demographic winter, or what could be termed “debirth”—the phenomenon of falling birthrates and social conditions that discourage family formation. This leads to an ageing population, a lack of intergenerational balance, and a pandemic of loneliness.
Debirth poses an existential threat to Europe, its long-term economic sustainability, and societal stability. If Europe is to secure its future, it must confront this demographic challenge and prioritise families as the engine of economic growth.
The Draghi Report is thorough, but its impact would have been greater had it framed competitiveness within the broader context of Europe’s long-term development, particularly with a focus on the younger generations. Europe is currently facing a demographic crisis, with birth rates in steep decline and populations ageing rapidly. In 2022, the average number of births per woman in Europe was just 1.46, far below the 2.1 needed for population replacement. This trend of debirth threatens the continent’s future, as it diminishes the human capital that is necessary to stimulate economic growth and innovation.
There is a misconception among some policymakers that population growth and family formation are not essential to economic development, instead taking a narrow view based largely on technological advancements and productivity. Without children, there is no future workforce, and without a growing workforce, economic progress becomes impossible. The family is the basic cell of society, providing the stability necessary to nurture and sustain future generations, serving the common good by its very nature. Simply focusing on productivity without addressing debirth is a short-sighted approach that ignores the root cause of Europe’s demographic crisis.
It was a missed opportunity from the former Central Bank President to ignore the demographic winter’s centrality. Solutions to encourage higher birth rates and to support families would have been a more effective way to ensure sustainable growth. Encouraging the European Commission to treat demographic policies as long-term investments, rather than social costs, would empower national communities to plan for their futures with the necessary resources in line with the value of subsidiarity. Instead, the Draghi Report reduces demographics to a discussion of productivity, noting that low birth rates negatively affect economic output, but offering no real solutions to counter the decline in population.
This is where the debate must shift. With current birth rates, even ambitious efforts to enhance productivity—through digitalisation, automation, or improved workforce training—will fall short. If the population continues to age and shrink, competitiveness can only be maintained by driving down labour costs, which is unsustainable in the long run, particularly during periods of inflation. Low wages not only harm businesses by stunting domestic demand but also place a heavy burden on households, depleting their savings and diminishing their economic security.
Indeed, the report also highlights household savings as a potential resource for improving competitiveness, but this approach is eyebrow-raising. Asking families—particularly in countries like Italy, where saving habits are deeply ingrained—to channel their savings into centrally managed European funds risks syphoning off resources from local communities. This could further exacerbate the depopulation of rural areas, where economic opportunities are already limited, and family life is increasingly difficult to sustain. Couple this with the inexorably rising housing costs for young people in urban zones and we see the perfect storm that has long been brewing.
It is undeniable that Europe must strengthen its international presence and increase exports, but this cannot come at the expense of domestic demand. Striking a balance between global market expansion and local economic health is crucial.0 Placing an excessive focus on international markets may benefit large corporations, but it poses significant risks for small and medium-sized businesses, rural communities, and families. By prioritising competitiveness at the expense of these communities, Europe risks departing from the values of its founding fathers, such as De Gasperi, Schuman, and Adenauer, who championed family welfare, peace, and solidarity among national communities—not just relevance in the global marketplace.
The demographic winter in Europe is not merely a social issue but a direct threat to economic sustainability. If the European Commission truly wishes to secure Europe’s future, it must broaden the scope of reports like the Draghi Report to include demography as a foundational element of economic policy.
Debirth is not a challenge that can be solved by short-term productivity gains or cost-cutting measures. Rather, it requires a strategic commitment to supporting families, encouraging higher birth rates, and fostering intergenerational solidarity and social cohesion. After all, families and communities are not only the beneficiaries of European policies; they are the true engines driving the continent’s prosperity.
Debirth Crisis: Why the Draghi Report Misses Europe’s Demographic Decline
Photo by Pixabay
The Draghi Report has sparked a vital conversation about Europe’s future, bringing the continent’s economic development to the centre of public debate. While the report covers important economic issues, it overlooks one of the most pressing concerns: the ongoing demographic winter, or what could be termed “debirth”—the phenomenon of falling birthrates and social conditions that discourage family formation. This leads to an ageing population, a lack of intergenerational balance, and a pandemic of loneliness.
Debirth poses an existential threat to Europe, its long-term economic sustainability, and societal stability. If Europe is to secure its future, it must confront this demographic challenge and prioritise families as the engine of economic growth.
The Draghi Report is thorough, but its impact would have been greater had it framed competitiveness within the broader context of Europe’s long-term development, particularly with a focus on the younger generations. Europe is currently facing a demographic crisis, with birth rates in steep decline and populations ageing rapidly. In 2022, the average number of births per woman in Europe was just 1.46, far below the 2.1 needed for population replacement. This trend of debirth threatens the continent’s future, as it diminishes the human capital that is necessary to stimulate economic growth and innovation.
There is a misconception among some policymakers that population growth and family formation are not essential to economic development, instead taking a narrow view based largely on technological advancements and productivity. Without children, there is no future workforce, and without a growing workforce, economic progress becomes impossible. The family is the basic cell of society, providing the stability necessary to nurture and sustain future generations, serving the common good by its very nature. Simply focusing on productivity without addressing debirth is a short-sighted approach that ignores the root cause of Europe’s demographic crisis.
It was a missed opportunity from the former Central Bank President to ignore the demographic winter’s centrality. Solutions to encourage higher birth rates and to support families would have been a more effective way to ensure sustainable growth. Encouraging the European Commission to treat demographic policies as long-term investments, rather than social costs, would empower national communities to plan for their futures with the necessary resources in line with the value of subsidiarity. Instead, the Draghi Report reduces demographics to a discussion of productivity, noting that low birth rates negatively affect economic output, but offering no real solutions to counter the decline in population.
This is where the debate must shift. With current birth rates, even ambitious efforts to enhance productivity—through digitalisation, automation, or improved workforce training—will fall short. If the population continues to age and shrink, competitiveness can only be maintained by driving down labour costs, which is unsustainable in the long run, particularly during periods of inflation. Low wages not only harm businesses by stunting domestic demand but also place a heavy burden on households, depleting their savings and diminishing their economic security.
Indeed, the report also highlights household savings as a potential resource for improving competitiveness, but this approach is eyebrow-raising. Asking families—particularly in countries like Italy, where saving habits are deeply ingrained—to channel their savings into centrally managed European funds risks syphoning off resources from local communities. This could further exacerbate the depopulation of rural areas, where economic opportunities are already limited, and family life is increasingly difficult to sustain. Couple this with the inexorably rising housing costs for young people in urban zones and we see the perfect storm that has long been brewing.
It is undeniable that Europe must strengthen its international presence and increase exports, but this cannot come at the expense of domestic demand. Striking a balance between global market expansion and local economic health is crucial.0 Placing an excessive focus on international markets may benefit large corporations, but it poses significant risks for small and medium-sized businesses, rural communities, and families. By prioritising competitiveness at the expense of these communities, Europe risks departing from the values of its founding fathers, such as De Gasperi, Schuman, and Adenauer, who championed family welfare, peace, and solidarity among national communities—not just relevance in the global marketplace.
The demographic winter in Europe is not merely a social issue but a direct threat to economic sustainability. If the European Commission truly wishes to secure Europe’s future, it must broaden the scope of reports like the Draghi Report to include demography as a foundational element of economic policy.
Debirth is not a challenge that can be solved by short-term productivity gains or cost-cutting measures. Rather, it requires a strategic commitment to supporting families, encouraging higher birth rates, and fostering intergenerational solidarity and social cohesion. After all, families and communities are not only the beneficiaries of European policies; they are the true engines driving the continent’s prosperity.
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