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Thursday, March 29, 2007

Martin Wolf: The War on the Traditional Family

Martin Wolf says the welfare state is contributing to the demise of the traditional family:

The war on the traditional family, by Martin Wolf, Commentary, Financial Times: Incentives matter. If society rewards uneducated young women for becoming single parents, they will adopt that as their career. That is precisely what British politicians have done...

This is not how politicians put it. ...[They do not] admit that their aim is to eliminate the committed married couple from the poorer sections of British society. But that is the inevitable effect of trying to ensure that the choices of parents have no bearing on the economic welfare of their children.

It is not excessive to describe the resulting policies as a “war” on the traditional family. That is what it is, as Patricia Morgan, a well-known analyst in this area, argues...

Before the welfare state, both members of a couple needed one another – and, if possible, the extended family – because caring for children is incompatible with simultaneously earning an adequate income for a family. That has not changed. The difference is only that taxpayers now provide that income.

“By the end of the century,” Ms Morgan writes, “73 per cent of lone parents were receiving family credit [to bolster wages] or income support; 57 per cent were receiving housing benefit and 62 per cent council tax benefit. The figures for couples with children were 11 per cent, 8 per cent and 11 per cent respectively.” ...

The economic penalties for trying to create and sustain a stable and committed couple are, for those on moderate incomes, substantial. But the economic incentives for “faking it” are impressive.

Joint annual income now has to reach something like £50,000 gross before the couple suffers no loss from declaring a relationship. If a boyfriend who earns £380 a week pretends not to live with a non-working lone mother who has two children under 11, the couple will be £9,018 a year – no less than 60 per cent – better off than if the relationship is declared. Marriage has become economically damaging. So has honesty.

Why is the welfare system structured this way? One reason is the overriding aim of eliminating child poverty, regardless of the choices of parents; the other is the presumed desirability of liberating mothers from dependence on a man.

Yet it is assumed that incentives have no bearing on behaviour. The evidence is overwhelmingly against this absurd idea. Trying to eliminate child poverty by subsidising the form of family that is most likely to suffer from it is like trying to bale out a boat with a sieve.

The social consequences are severe. In a world in which the state replaces the father, uneducated young men are permanent adolescents, useful to father children but lacking any other valuable social role. We know that unmarried men are far less likely to work than married ones. This is partly because they are less marriageable. It is also because they have less incentive to work.

In current circumstances, there is little chance of restoring a strong social preference for committed marriage. But it might be possible to agree about removing the discrimination against it. There should be no favourable treatment of lone parents, just as there is not in many high-income countries that have much better records than the UK on child poverty. ...

Similarly, there should be no presumption that ... lone-parent families are entitled to benefits that are unavailable to two-parent ones. This will be deemed “judgmental”. But a policy of subsidising the lone-parent family is also a judgment. The judgment is that incentives do not matter, that the signal this policy sends about marriage has no effect and that it is of no interest to society whether two parents are committed to the family or not.

Sooner or later, I believe, society will agree that these have been mistaken judgments. In the meantime, much damage is being done by a policy whose focus on the immediate challenge of poverty ignores its inevitable long-run costs, including, alas, the persistence of poverty itself.

The decline in marriage is, I think, a little more complicated than simply the incentives provided by welfare payments. Even if you agree that the state should impose a financial penalty (or remove any financial incentive) on single-parents to encourage marriage, before we reduce payments to single-parents and potentially further disadvantage some children, we should be sure that the payments are the source of the problem and that there aren't better ways to affect the incentive for couples to marry. Many will disagree, but personally I'm uncomfortable with this degree of social engineering. I think government's goal ought to be neutrality - don't encourage marriage and don't discourage it - and perhaps that is all Martin is trying to say.

This is from a previous post, "Marriage is for White People":

African Americans ... have the lowest marriage rate of any racial group in the United States. In 2001, according to the U.S. Census, 43.3 percent of black men and 41.9 percent of black women in America had never been married, in contrast to 27.4 percent and 20.7 percent respectively for whites. African American women are the least likely in our society to marry. ...I was stunned to learn that a black child was more likely to grow up living with both parents during slavery days than he or she is today... Traditional notions of family, especially the extended family network, endure. But ... in an era of brothers on the "down low," the spread of sexually transmitted diseases and the decline of the stable blue-collar jobs that black men used to hold, linking one's fate to a man makes marriage a risky business for a black woman. ...

"Women don't want to marry because they don't want to lose their freedom." Among African Americans, the desire for marriage seems to have a different trajectory for women and men. ... As men mature, and begin to recognize the benefits of having a roost and roots ..., they are more willing to marry and settle down. By this time, however, many of their female peers are satisfied with the lives they have constructed and are less likely to settle for marriage to a man who doesn't bring much to the table. Indeed, he may bring too much to the table: children and their mothers from previous relationships, limited earning power, and the fallout from years of drug use, poor health care, sexual promiscuity. In other words, for the circumspect black woman, marriage may not be a business deal that offers sufficient return on investment.

In the past, marriage was primarily just such a business deal. Among wealthy families, it solidified political alliances or expanded land holdings. For poorer people, it was a means of managing the farm or operating a household. Today, people have become economically self-sufficient as individuals, no longer requiring a spouse for survival. African American women have always had a high rate of labor-force participation. ... But now instead of access only to low-paying jobs, we can earn a breadwinner's wage, which has changed what we want in a husband. ...

By design or by default, black women cultivate those skills that allow them to maintain themselves (or sometimes even to prosper) without a mate. ... And here's the new twist. African American women aren't the only ones deciding that they can make do alone. Often what happens in black America is a sign of what the rest of America can eventually expect. In his 2003 book, ... Andrew Hacker noted that the structure of white families is evolving in the direction of that of black families of the 1960s. In 1960, 67 percent of black families were headed by a husband and wife, compared to 90.9 percent for whites. By 2000, the figure for white families had dropped to 79.8 percent. Births to unwed white mothers were 22.5 percent in 2001, compared to 2.3 percent in 1960. So my student who thought marriage is for white people may have to rethink that in the future. ...

But human nature being what it is, if marriage is to flourish -- in black or white America -- it will have to offer an individual woman something more than a business alliance, a panacea for what ails the community, or an incubator for rearing children...

    Posted by on Thursday, March 29, 2007 at 01:57 PM in Economics, Social Insurance | Permalink  TrackBack (0)  Comments (46)

          

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