Another Election Day question…
“Marco Rubio: Tax Reform Should Help American Families” (nytimes) tries to sell the latest Republican tax proposal on the grounds that, compared to the current system, there will be more handouts for Americans with children under age 18. The discussion is framed by pointing out what money-sinks children can be:
According to federal data adjusted for inflation, from 1960 to 2015 the average annual cost of raising a child in a middle-income family rose by over $ 11,000. It’s now estimated that middle-class parents will spend more than $ 230,000 over the course of their son or daughter’s childhood — and that doesn’t even include college tuition.
[The Senator and the NYT Editors don’t explain the arithmetic here. The cost is $ 11,000 per year higher over 18 years. That’s a total of $ 198,000. If we subtract that from the current cost of $ 230,000 we find that the cost to parents back in 1960 was only about $ 32,000 in today’s mini-dollars. Does that make sense given that food and clothing are cheaper than ever? (and, of course, the paper does not have the bad taste to point out that an American who has sex with a dermatologist can get $ 230,000 per year in tax-free child support, depending on the state) Senator Rubio also claims that this $ 230,000 is more than it costs to buy a house, which sounds wrong to those of us living in on the sacred coasts of righteousness, but is close to being true nationwide according to realtor data (median existing single-family home sold for $ 246,800 in September 2017; used condos sold for a median price of $ 231,800).]
The article goes on to say that some Americans aren’t having as many babies as they would in a world where children were cost-free (i.e., paid for by someone else). This is a serious problem in a country with a population of 325 million that, apparently, seeks to overtake China and India.
“Having kids is one of life’s greatest experiences.” [the article’s first sentence]
Hard to argue with this, but then why can’t we parents pay for our own kids instead of asking childless Americans to pay yet more for them? The childless already pay for a share of K-12, right? When we go to a restaurant with our kids ([a] mercifully infrequent [event]) we don’t say “This must be one of life’s greatest experiences for the childless people in this restaurant” and then go around asking other diners to chip in for our meal. Yet that is exactly what the government is doing via a tax code that makes the childless give up a higher percentage of their income.
Given that there are more voters (the childless and those with adult children) who will pay for this compared to the number who will enjoyed the reduced tax rates, I’m wondering why this is a selling point.
Childless Americans don’t voluntarily go around to those with children and offer money, do they? If not, why would a majority of childless Americans vote to have the government take money from them and give it to Americans with minor children?
Most of the top-rated comments on the piece demand yet more handouts or complain that others are richer:
So if you value families, Senator, how about paid family leave, quality prenatal care and healthcare throughout a child’s life, and universal childcare and preschool? And how about quality K-12 schools and educational opportunities, not just for the elites but for all Americans, investing in the future of our country?
The mom’s [sic] I talk to tell me that daycare runs about $ 15,000 a year per child. If we really want to help families, how about funding daycare like those awful freedom robbing socialist European countries do? We can’t do that here because that would entail federal spending and the federal government isn’t supposed to spend money on the little people. We give them paltry tax breaks which doesn’t cover the cost of daycare or health insurance and other socialist programs that all other modern industrialized nations provide.
For someone who is currently deciding on whether or not to have a second child this article really angers me. My husband and I make a good living, but we are both self employed. Our insurance is going up next year and premiums will be over 1k a month. We don’t quality for tax credits for health care and we would have an out of pocket cost of over 7k for having another baby. This is on a silver plan. After having a baby we would need extra childcare which would cost us at least 1200 a month on top of preschool cost for our son. We don’t need a measly $ 2k tax credit, we need affordable childcare, affordable healthcare and paid parental leave. Being from a Northern European country originally, my husband and I have decided to move to Europe in 2019. Unfortunately, the United States is not a good place to raise a family.
A $ 2,000 tax credit won’t do much. If you really want to help working families, provide them with affordable healthcare, childcare, and education. That will require a tax increase on the wealthy, not the huge tax breaks you’re giving them now.
If your party would do something about the problems you mention here, like a mandatory living wage, daycare as part of public education (thus free), paid family leave, free community college, a functioning healthcare insurance system as opposed to sabotaging it), perhaps things would be a lot better.
And kids over 18 going to college, while still dependents, don’t qualify for the child tax credit making the loss of the personal exemptions even more onerous to the family finances. [at least in Massachusetts the child support profits can continue to flow until age 23]
Keep the inheritance tax – families with that much money do not need our help.
You mention student loans in the very first para. Why not do something about the cost of college education as your Democratic colleagues want to do? Affordable college education can not only help parents but will make the country competitive in a global market.
As someone graduating college and looking to embark on my own “American Dream” the increasing pricetag of raising kids is a point of real concern for me. Because having children is a top priority in my life I want to do so without continual financial anxieties, yet with the new proposed tax plan and the current infrastructure, it seems to be increasingly difficult. It affects my career choice, place of residence, pregnancy timing and everyday spending.
The last one is my favorite. The author identifies him/herself as “Luke Yeager” from Boulder, Colorado and therefore the implication is that someone named “Luke” will be pregnant. He/she says “having children is a top priority in my life,” but not such a high priority that Luke wants to work to support the prospective brats: “I want to do so without continual financial anxieties.” Maybe Colorado doesn’t offer free housing to those with kids and zero income? Luke needs to come to Massachusetts and discover the miracle of means-tested public housing (sometimes in newly constructed luxury commercial apartment buildings), Masshealth (our Medicaid), food stamps, etc. We will be happy to pay for as many children as his pregnancies produce. If he and his adult partner have two children and don’t want to stay home all day playing Xbox they can earn up to $ 78,150 per year and remain in Boston public housing (chart).
There are a few NYT readers guilty of “maybe we don’t have infinite money” thoughtcrime:
Households of childless couples or single men and women already have their taxes used for public education and related expenses which are significant. Yes, I can see the collective good there. But to add further tax burdens/costs to those who, by great measure, choose not to have children out of being financially responsible and realistic of their earning powers to have to finance the raising of children by shouldering further tax breaks for those that choose (or recklessly) have children is starting to approach a point of grossly unfair. Add food assistance programs and healthcare….we’re talking real money. The single or childless household is being unfairly burdened.
In general, individuals and societies who can most easily afford more children tend to have fewer of them and vice versa. Thus, I question the proposed correlation between fertility rates and taxes. More importantly, we have an appalling rate of child poverty in this country (about 20%). Supporting the education and welfare of these children should be the top priority, not encouraging everyone to have more of them.
i’m all for helping to defray the cost of child-rearing, but as a happily single and childless fully self-employed adult, i need some help with payroll taxes, too. right now, i have zero confidence that i will ever live to collect social security. lifting the income cap on the payroll tax would save that program for all american workers, those with children and those without.
The article concludes with “Raising children is the most important job we will ever have.” (he does not cite Bill Burr on how it is also the toughest)
Readers: What do you think? Is it strange that people vote to have the government make everyone do something that practical nobody does voluntarily? (and Happy Election Day if you’re voting!)
Philip Greenspun’s Weblog