In this time of economic and social upheaval, many policy changes that would have been unthinkable are on the table. For a few examples, Republicans agreed to a massive direct stimulus payment, the Federal Reserve is enacting radical changes in policy, and unemployment benefits have been dramatically expanded.
These responses offer an opportunity to shift economic policy in an even more family-centered direction. Many are already talking about the effects of the COVID-19 lockdowns on families, with questions about the health and development of children and the reopening of schools a primary conversation piece. New York Post columnist Karol Markowicz said that New Yorkers are essentially being told to choose between their jobs and their children due to Gov. Andrew Cuomo’s poor leadership. Hillary Clinton, in a tweet about a New York Times article, said, “We need to make child care more accessible and safe for every working parent.”
With those comments in mind, a more important and timely question is: Why do so many households have two working parents in the first place? Isn’t it better if one parent is free to focus on raising children? A 2016 Pew poll found that 59% of adults believe that children with two parents are better off when a parent stays home. This view was held by the majority across all education levels and political affiliations in the survey.
Given the apparent preference for a single-earning household, making child care more accessible is a bad idea. A massive increase in the availability of daycare increases the likelihood that both parents will work. Think about it this way: If daycare is more accessible, it will shift the economic incentives related to working rather than staying home with children, tilting the decision more in favor of working. The COVID-19 lockdowns have inconvenienced many parents, but national daycare isn’t the solution.
A family wage is a proper solution. It would ensure that one parent could work outside the home while the other could stay home. This may appear to some to be a radical proposal, but back in 2004, a much more reactionary — and perhaps even “conservative” — Elizabeth Warren published a book decrying the “two income trap” that demonstrably hurts the economic prospects of middle-income families. In the book, Warren explains that a second income is largely used up paying other costs like babysitting and commuting that would otherwise not exist.
How would a family wage work? Certainly not every line of work adds enough value to support a living wage for the employee. In much the same way that full-time employees often have more fringe benefits than part-time workers, a family wage could also be part of the basket of benefits for full-time work. Employers could be required to scale employees’ gross pay based on the number of dependents the employee listed on their W-2 forms.
If implemented, a family wage structure would mean that if Susan were to stay home with the children, Bob would need to provide an income for the whole family. In addition to the benefits his employer provides such as health insurance and retirement contributions, Bob’s income would be based in part on the fact that he has four dependents: his three children and now his wife, Susan, who has chosen to spend her time caring for them.
Assuming that Warren would support this type of policy, we can expect many Democrats to get on board. But what about Republicans? President Trump’s election in 2016 has emboldened those on the Right who are far more concerned about economic security and the health of the family than about budget issues and fighting unending wars abroad. It’s not hard to imagine Tucker Carlson agreeing with the notion of a family wage. The family wage is a policy that might build a coalition of America-first conservatives and liberal Democrats.
The specifics of the policy would need to be hammered out, and we should be aware of potential unintended negative consequences, but the implementation of a family wage could improve our family lives immensely. As Oren Cass shows in his recent publication “The Cost of Thriving Index,” median wages today are far below median wages in the past in terms of the ability to secure basic needs. Basic housing, health insurance, transportation, and education are significantly more expensive relative to median wages today than they were as recently as the mid-1990s. A family wage could improve this ratio in favor of many families.
It may seem radical, but this particular moment of upheaval and chaos can be used to foster a more family-first society. While economic policy is not a cure-all for social ills, implementing a family wage and turning economic policy toward the family is a move in the right direction.
Levi Russell is an Assistant Teaching Professor at the Brandmeyer Center for Applied Economics at the University of Kansas and a Fellow at the Leonine Institute for Catholic Social Teaching. You can email him at [email protected].
