The Cost of Natalist Tax Credits, the Magnitude of Coercion, and the Value of People

Some responses to several excellent questions from Matt:

1. Matt’s concerned about the distributional effect of natalist tax credits:

Given that his policy would only apply to taxpayers, might hedge fund managers with large families get a free pass? And would this not mean doubly penalizing working class couples unable to bear children?

Actually, if the numbers I presented are remotely close to the truth, natalist tax credits would even benefit working class couples unable to bear children. My argument wasn’t merely that tax credits are a good idea all things considered. My claim, rather, is that natalist tax credits are a fiscal free lunch. Modest tax credits are enough to inspire the creation of new people who will pay far more in taxes than they’ll ever collect in services and benefits. You can question the estimates, but as I said, this free lunch is so big that you can drastically revise the numbers without changing this conclusion.

2. There is no easy answer to Matt’s toughest question:

People struggle to compare the great human rights atrocities of the 20th century, but at least we can count the bodies. How do we even begin to calculate the toll on women’s health and wellbeing of having to bear children against their will, and then compare it to the tragedy of others who were denied that right?

But I’ll try anyway:

First, it seems much more wrong to force a woman to have an abortion than to prevent her from having an abortion. I’m pro-choice, but I have to admit that the pro-life position is far from crazy. There’s at least a semi-plausible moral rationale for banning abortion. The arguments for forced abortion, in contrast, are so flimsy almost no one even bothers to make them.

Second, all else equal, coercing more people is worse than coercing fewer. And most women do not want and will not seek abortions whether or not they’re legal. But most women do want children; indeed, most want more than one.

3. Matt’s last point seems completely wrong to me:

Most people judge liberty, prosperity, and health to be good in and of themselves because they wish to live in a society that maximizes each one of them. Who wants to live in a society that maximizes fertility, especially if manipulating or pressuring couples to have more children comes at the cost of liberty, prosperity, and health?

Mathematically, as Henry Sidgwick pointed out, you can’t maximize more than one thing. And, although people may say they want to live in a society that maximizes liberty, prosperity, or health, no one would actually want to live in such a society. Why not? Because there are trade-offs. To maximize health, for example, you would have to force people to exercise and eat right—and keep ramping up the coercion until you reached the point where more coercion would actually start to hurt health. To maximize liberty, similarly, you would have to bite all the bizarre bullets that David Friedman offers in The Machinery of Freedom.

This doesn’t mean that liberty, prosperity, and health aren’t good in themselves. It just means that no one good thing should be “maximized.” Once you admit that, why not add population to the list of intrinsic goods? I’m glad to be alive. If one more person is born, he’ll probably be glad too.

Also from this issue

Lead Essay

  • Bryan Caplan argues that declining world populations aren’t such a good thing after all. While we may have dodged the “population bomb” predicted in the 1970s, the world still benefits from more suppliers — and demanders — of new goods and services. Friends of scientific and cultural advancement should want more people around. All of which leads him to a question: Are there ways to incentivize population growth without sacrificing individual liberty? Caplan suggests several methods, including open immigration, tax incentives for children — and the direct, ultimately private argument that having more kids is more fun than most people realize.

Response Essays

  • Gregory Clark argues that, while Caplan may more or less accurately describe the history of economic development, mineral and other reserves in the West have been significantly depleted. What holds true today will not hold true indefinitely regarding food, energy, and basic mineral commodities. The balance between population growth and resources only recently tipped toward abundance, and it will likely tilt in the other direction soon.

    Clark agrees, however, with Caplan’s suggestion that on the margin, middle-class families stand little to lose and much to gain by having more children; cultural assumptions in the West likely overestimate the importance of nurture, and as a result, middle-class Americans probably do overinvest in their children.

  • Matthew Connelly reviews the history of pro- and anti-natalist policies around the world. He finds them both full of coercion, perverse incentives, misogyny, and — if states try hard enough — atrocity. Population trends, however, are very stubborn, and the payoff to such policies is low. In his words, “economists do not know where babies come from.” Not, anyway, such that they can motivate people without destroying their autonomy. If libertarians are recruited to the pro-natalist side, as Caplan urges, their enlisting could come at the price of individual liberty itself.

  • Betsey Stevenson agrees that parents are often generally less happy than otherwise similarly situated nonparents. But she casts doubt on the theory that excessive parental worry is the source of the unhappiness. The most worrying parents, those who spend the most time on childcare, are also the ones who report relatively higher levels of happiness. There is, moreover, more to life than self-reported happiness, and parents may very well have other desires and values than just this one. Neither self-reported happiness nor economic utility are all that there is to our various ideas of the good life. We still need to learn more about why parents describe themselves as less happy before we can prescribe more children and less worrying as the remedy.