The year 2005 was a momentous turning point for the world's second largest economy. Two years earlier than expected, the population of Japan―the world's 10th largest nation―began to shrink. Perversely, economists and Japanese officials greeted this news with the gloom evinced by Malthusian analysts during the 20th-century panic about a global population explosion. Instead of famine, the new alarmists foresee labor shortages, empty schools, under-funded pension schemes and diminished national power. Demography is a contentious topic and nowhere more so than in Asia, which has a huge population. Even in China, currently No. 1 with 1.3 billion inhabitants, there are concerns about the damaging economic impact of the aging of the population as numbers start to decline in about 2030. Government ministers in India―which is expected to overtake China and have 1.6 billion people by 2050―have taken to gloating about the dynamism that will come from a young population and repeating economists' warnings that “China will grow old before it grows rich.” They forget the downside of a demographic trend involving the addition of an extra 500 million Indians to the human population: Before it becomes either old or rich, India will become extremely crowded. Alarmism about declining population is foolish for two reasons. First, it is not happening on a global scale. According to the Population Reference Bureau, the world population of 6.5 billion is rising by 80 million people a year and is expected to reach 9.3 billion in 2050. The second reason not to be alarmed is that a stable or declining population ought to be seen as a welcome change―not merely as a harbinger of temporary fiscal crisis―for individual countries and for the world. You do not have to be a Malthusian worried by what the much-reviled demographer called “the perpetual struggle for room and food” to see that our planet is already overcrowded and its natural resources under intense strain. This is particularly so in Asia, where population density is more than twice the world average. Even if we ignore such international challenges as global warming, many countries face, at a national level, severe problems related to the size of their populations. Dozens of Chinese cities face dire shortages of fresh water, while the ravenous appetite for resources to fuel China's industrial revolution has already forced up the price of oil and stripped neighboring countries of much of their forest cover. India's modernization has barely begun. Given the impossibility of perpetually rising populations, common sense suggests that Japan and the countries that follow should each try to manage a gradual population turnaround to avoid the shock of a sudden surfeit of pensioners. In most cases, they are already examining ways to ease the transition, including more immigration, automation, raising retirement ages and bringing more women into the workforce. As Japan will discover in the decades ahead, managing a falling population will not be easy. Yet there is no reason to be afraid of pioneering a process that our grandchildren will see as both inevitable and desirable.