Whole society benefits from well-raised and well-educated children

Hans G. Despain and Karol Gil-Vasquez

Leo Tolstoy’s novel Anna Karenina begins with the provocative line: “All happy families are alike; each unhappy family is unhappy in its own way.” Tolstoy’s novel explores the complications of family life. Tolstoy’s characters demonstrate happy families are rare and parenting is difficult.

In United States parenting and family life is not only difficult, but very expensive due to a lack of the most basic infrastructure and public policy to provide support to families.

This is unfortunate because families are the basic building block in society and need to be protected and nurtured. If family life worsens, the economy stagnates, while crime and social ills manifest.

Despite working hard, one third of American households report they are unable to pay their bills. American workers have faced stagnant wages for several decades, and the White House has warned in spite of the post-pandemic expected high growth rates and rising prices, wage growth is expected to decline over the next 12 to 18 months. 85{44affb6c5789133b77de981cb308c1480316fee51f5fd5f1575b130f48379a33} of American parents report they are spending 10{44affb6c5789133b77de981cb308c1480316fee51f5fd5f1575b130f48379a33} or more of their household income on child care. 95{44affb6c5789133b77de981cb308c1480316fee51f5fd5f1575b130f48379a33} of colleges are unaffordable for low-income households. And according to the Organization for Economic Cooperation and Development the United States ranks a dismal 37th, of 41 countries, for enrollment of 3-5 year-olds in early education.

The difficulties of parenting in the United States may explain why the fertility rates have plummeted in the U.S. for more than a decade, hitting an all-time low in 2018, again in 2019, and yet again in 2020. The fertility rate, the number of children a woman has in her lifetime, was 2.12 in 2007; it has fallen to 1.64 in 2020. When the fertility rate dips below 2.1 the population will shrink without immigration.

Low fertility is not necessarily economically harmful, but lacking the proper public policy low fertility tends to slow economic growth and it puts strains on the federal budget to pay for the retirement and health care needs of a larger older generation when the current working-age generation has shrunk. A low fertility certainly suggests that starting and supporting a family in the United States is difficult and too expensive.

The pandemic revealed the urgent need to address our child-care shortage. For over a decade there has been a shortage of affordable childcare across the country. Without affordable childcare Americans, especially mothers, can’t work. Researchers at University of Minnesota and the Center for American Progress show prior to the pandemic 51{44affb6c5789133b77de981cb308c1480316fee51f5fd5f1575b130f48379a33} of American live in an area with vastly inadequate child-care options, or “child-care deserts.”

The pandemic wreaked havoc of an already precarious national childcare system. Economists warn that as many as 50{44affb6c5789133b77de981cb308c1480316fee51f5fd5f1575b130f48379a33} of childcare providers will fail without government assistance. If this is allowed to happen it would expand the “child-care deserts” and force millions of parents, mostly mothers and older workers, out of the workforce. When a worker leaves the workplace, it hurts their career prospects and lowers household incomes. It further hurts business productivity, lowers revenues and profits, and slows economic growth.

All of this will distort the U.S. economy for a generation, by decreasing consumption and investment spending and lowering growth rates.

President Biden’s American Families Plan is pro-family policy to avoid the economic distortions caused by low fertility and the childcare shortage. Low-income families commonly spend 10{44affb6c5789133b77de981cb308c1480316fee51f5fd5f1575b130f48379a33} to 20{44affb6c5789133b77de981cb308c1480316fee51f5fd5f1575b130f48379a33} of household income on childcare. The AFP limits childcare to 7{44affb6c5789133b77de981cb308c1480316fee51f5fd5f1575b130f48379a33} of family income with expanded tax credits for childcare services.

Nearly all educational experts agree that preschool is the most effective strategy to improve later school performance. Wealthy families overwhelmingly enroll their children in preschool while low and middle families struggle to find access. AFP proposes that all American children have access to a high-quality preschool program starting at age 3. Teachers in these new universal preschool programs would have comparable qualifications of K-12 teachers and would be comparably compensated.

Many working parents of newborns must return back to work too early and struggle balancing family health and wellbeing with the need to provide financial security. AFP proposes paid parental leave for a newborn or adoption. Research overwhelmingly shows paid parental leave offers inarguable benefits for parents, children and the societies of countries who provide it. The United States is the only rich country offering no national paid parental-leave program. 82{44affb6c5789133b77de981cb308c1480316fee51f5fd5f1575b130f48379a33} of Americans support access to paid parental leave.

AFP proposes that community college is free for all Americans. This not only increases the number of Americans able to get an associate degree, but will encourage millions of Americans to complete their first two-years of college, for free, at a community college and then transfer their credits to a four-year college or university to complete a bachelor’s degree.

Happy and healthy families are the building blocks for healthy societies and must be nurtured and protected.

The whole society benefits from well-raised and well-educated children.

Pro-family policies promote healthy childhood development, encourage committed and caring citizens, are an investment to achieve societal goals such as lower unemployment, a more productive workforce, economic growth, and less crime.

Free child-care and preschool, free community college and parental leave are policies that make parenting easier, the workforce becomes more skilled and Americans become smarter. These policies will increase GDP, generating economic growth and increase household income. Most important they support families and strengthen American society.

Hans G. Despain, Ph.D., is professor of economics and chair of the economics program at Nichols College