http://www.slate.com/id/2097913
Two Is Enough
Why large families don't deserve tax breaks.
By Dalton Conley
Illustration by Nina FrenkelThe U.S. government encourages families to
have children, as many of them as possible. Child tax credits,
child-care tax deductions, and family leave policies all reward parents
with big broods. The pro-child policies are based partly on romantic
notions about mom, family, and apple pie, but they also have a rational
goal: We subsidize kids so that our next generation of workers is ready
to win in the global economy.
Problem is, these two goals—more kids and better-prepared kids—are at
odds. If we really care about kids' welfare and accomplishment, the
United States should scrap policies that encourage parents to have lots
of children. As my recent research shows, having more than two children
is tantamount to handicapping their chances for academic, and thus
economic, success. In this information economy, what we ought to be
doing through the tax code is making it easier for parents to ensure the
quality of their first one or two children, not stimulating quantity.
Pro-fertility tax policy is an outdated notion from an industrial era
when we needed bodies to fill manufacturing plants. Today we need fewer,
highly skilled kids who will compete with our rivals in math and science.
It's long been known that kids from large families perform worse in
school, but it has been impossible to explain why. That's because
research about the relationship between family size and children's
educational achievement has been plagued by a nagging issue: Large
families tend to be different from small families on a number of
fronts—religiosity, commitment to education, orientation to the future,
maybe even intelligence level. So it has been hard to assess the impact
of the number of children in a family as distinct from these other
differences. (Maybe Johnny can't read because he has unintelligent
parents, not because he is the sixth of nine kids.) After all, with all
due respect to Chairman Mao, we can't randomly assign parents to have
different numbers of offspring for the purposes of social
experimentation—that is, to find out if additional kids handicap offspring.
Here's where my research comes in. I deploy a natural experiment: I
examine which sexes parents get for their first two children—a seemingly
random event. The key is that families with two kids of the same sex are
17 percent more likely to go on and have a third than those with two
kids of the opposite sex. As it turns out, no matter what most people
say on surveys (or when their kids pop out), many parents desire at
least one of each kind. So my research strategy boils down to the
following: comparing children from families in which the first two were
of the same sex ("treatment group") to those in which the first two were
of the opposite sex ("control group") in order to see who fares better
educationally. In other words, while only some of the variation in who
goes on to have a third child is accounted for by the sex mix (that 17
percent), that variation is "pure"—that is, unbiased by all the other
factors that determine family size and determine achievement—since it is
a result of the random event of the sex mix. Its lack of bias is
bolstered by the fact that it does not matter which sex the first two
are—either way, parents are more likely to go on to have additional kids
in search of a complete set.
With the addition of the third child, firstborns don't appear to suffer
on the educational front. But middle-borns are severely hurt by the
addition of another mouth to feed: His parents are 25 percent less
likely to send him to private school, and he is several times more
likely to be held back a grade. The third child
<http://www.slate.com/id/2097913/sidebar/2097919/> is also less likely
to receive parental financial investment in his or her education and can
suffer from elevated risk of academic failure. Evidently, only
firstborns get off scot-free.
The reasons that additional siblings hamper the intellectual growth of
children (and particularly middle-borns) are fairly obvious—parental
resources are a fixed pie, and children do better when they get more
attention (and money). The conclusions to be drawn are more
controversial. For example, we always talk about the goal of raising
test scores and the overall "intellectual" or "human" capital of our
population to fit the needs of the new information economy (and to
compete with other nations in math and science), yet our tax policy does
the exact opposite: It gives tax credits for additional kids. We have to
confront the possibility that a more powerful educational (and
antipoverty) policy is a tax structure that acts as a disincentive to
have more children. Research has long shown that family background is a
lot more important than school conditions in predicting academic success
or failure. Just about the most controllable aspect of family background
is how many kids are in that family. So it stands to reason that a more
effective education policy may be to provide economic disincentives to
large families.
Perhaps a suitable compromise would be to have a declining tax
credit—granting a big subsidy for the first kid, a bit less for the
second, then cutting back to nothing (not unlike the current system for
the Earned Income Tax Credit). Such an adjusted tax credit (and
associated deductions) makes economic sense since the addition of the
first kid is the most expensive. It makes educational sense, and last of
all, it makes common sense. After all, do we really want to subsidize
kid No. 9?
Such a fertility-unfriendly policy would put us at odds with European
nations that are desperately trying to stimulate population growth by
increasing the tax incentives to have more kids; but then again, if we
can't find common ground with the Europeans in foreign policy, what
should make domestic policy any different? (Unlike most of Europe, we
have a steady influx of immigrants to sustain population growth.) More
important, the antibrood tax policies would anger those on both sides of
the political aisle here in the United States. Religious
conservatives—who see procreation as a divine imperative—may take
offense at the notion that the government would not do all it could to
facilitate this goal. Similarly, many on the left will protest that such
a policy is class-biased, allowing rich people who would be less fazed
by the additional expenses to have as many children as they please while
leaving poor people to feel the extra pinch. Americans of all political
stripes might take offense at the notion of the government getting
involved in the sacred sphere of family life. But the truth is that we
already are meddling with family fertility through our tax code. We're
just not acknowledging it, and, furthermore, we're doing it the wrong
way. We need honest discussion about the trade-offs between child
quantity and quality.
==========================================================================
_______________________________________________
Futurework mailing list
[email protected]
https://lists.uwaterloo.ca/mailman/listinfo/futurework
