Despite China's fertility rate plummeting to 1.09, the country has a demographic cushion that will carry it through mid-century without serious economic consequences. China's "Alpha" generation (currently ages 6-16) is a large demographic echo of its massive Baby Boom, and will stabilize the workforce through the 2020s and keep the dependency ratio favorable until at least 2030. China's dependency ratio won't surpass America's until the mid-2040s. Two straightforward policy levers -- raising the retirement age from 50-60 to 65 and dramatically increasing college enrollment (already jumped from 26.5% to 60.2% since 2010) -- will offset all effects of gradual aging over the next 25 years. Real demographic strain won't materialize until post-2050 when the large Millennial generation retires without a comparable replacement cohort. The idea that demographics will erode China's competitive position in the next two decades is overblown.

If you want to talk demographics, there are a lot of places that are way worse off than China. Obviously there are the usual suspects, S.Korea and Japan, but also Germany, Italy, and Spain. (Europe's largest economies, France aside... and I'm not so sure about France!) All of them have demographic situations that are far worse than China's, unless you genuinely subscribe to the notion that they can somehow be fixed via mass immigration from third-world countries.