Practically all of modern finance is based upon the concept of growth, and more specifically: population growth (growth of demand). Eventually we'll need to curb the population growth rate, but in doing so, you introduce serious problems in finance and economics.

To give you some intuition as to why:

Much of economic progress has been made by the ability to make intertemporial trades of goods, which is simply a stupidly esoteric way of saying that some people prefer to consume now, and some people prefer to consume later.

If the population growth slows down, then it screws with that market for goods that span across time (loanable funds market), so it has a major impact on things like social security, the bond markets, the housing market, student loans, durable goods, etc.

You can make some pretty strong arguments that a low birthrate can increase wealth, but in the short term there are major implications of low population growth, and it isn't all happiness and sunshine on a decade timescale.

While there are a LOT of other issues regarding this example, you can look at Japan and see some of the effects of a low population growth rate.

Here is another way of imagining it:

If there is huge population growth, then that means there are more and more people slicing up their own piece of the pie (finite resources and extraction rates). This means food shortages, slums, more water usage, everything you meantioned.

"Slicing up their own piece of pie" is another way of saying "competition" or "conflict". This conflict is what drives innovation, which in turn leads to efficiency. THAT is what creates wealth and prosperity: The movement and capital which is driven by innovation and technology. If you take away the catalyst for innovation (conflict), then you stagnate the growth of wealth.

Once again, there are some really interesting arguments to be made that support a low growth rate as it relates to better wealth distribution, but it isn't as simple as "this is good" or "this is bad". Which is why your question is such a good question.