The Invisible Heart: Economics and Family Values

Nancy Folbre

The Economics of Care: The Milk of Human Kindness

• Milk as a metaphor for Kindness• Motherhood represents both • Social Change

– 1969: keep female achievements secret– 1977: 2/3rds agree “It is much better…if the man is the

achiever…”– 1998: 1/3rd agrees

• What are the connections between masculinity, femininity, self-interest and care for others?

Political Socialization versus Economic Socialization

• The consequences of the Women’s movement are that women now know that economic benefits lie with achievement not care-giving.

• If all women adopt this strategy society will become oriented toward achievement over care.

• Mothers economic investment is greater than Fathers– Consequences:

• Women focus on number of offspring• Fathers acquire power & financial responsibility• Biological division of labor leads to social/cultural control

Specialization of Women as Care Givers

• Economic efficiency drives specialization

• Nationally countries specialize in single exports

• Their economies are considered not diversified and vulnerable to collapse

• Specialization of care giving is good for society not the caregivers.

Consequences of Specialization

• Dependency on male providers• Socialization away from distinct individualism• Violence to lower productivity enforcing

subordination– Chinese foot binding

– Female “circumcision” (African nations)

– Beating (Western Nations)

– Rules of exclusion (Islamic societies)

Liberal Political Theory and Women

• Locke– Men should have ownership of themselves– Men should be able to claim the products of his own labor (incentive

to work hard & well…quality)

• The Double Standard– Women could not access education or work– Women’s product was children but could not claim authority over

male children

• Astell 1694 “A Serious Proposal to the Ladies for the Advancement of Their True and Greatest Interest”– Identified the contradiction in the glorification of motherhood and the

lack of reward– The responsibility for care received no reward

Smith & Malthus versus Mill

• Adam Smith – trickle down theory– Encouraging men to pursue their economic self-

interests is good for society because the economic benefits trickle down to others

– “It is not from benevolence that we expect our dinner”– In fact dinner probably did come from the coerced or

socialized benevolence of the wife– Self-interest only existed in the impersonal world of the

market– Service labor was unproductive (but not unimportant)

Smith & Malthus versus Mill continued

• Malthus – also interested in self-interest – Benevolence & charity could be destructive (poor

people would reproduce)– population control but not via birth control– Men should delay marriage – women responsible for

children out of marriage

• Mill, John Stuart – On The Subjection of Women – Argues that women are denied equal rights and forced

to assume disproportionate moral & economic responsibility for care

Separate Spheres Argument

• Women and men should inhabit separate spheres.• Women are destined to preserve the values of

society and the home.• Women had to provide a civilizing counterpoint to

the disruptive effects of competition on society.• Women who disagreed were selfishly attempting

to emulate men.• This argument explained why women should be

altruistic and men should be self-interested

Separation of Sex from Father and Motherhood

• Men separated sex from fatherhood from (at least) 1600s – prostitutes

• Social resistance to contraception: what would happen if women were allowed to separate sex (pleasure) from motherhood (responsibility)

• Britain and U.S. contraception defined as obscene– 1873 Comstock Act

• Moral Exhortations to have more children– Perpetuation of “better” elements versus “voluntary”

motherhood

The cultural debate about Feminism

• Family Values– Women should be caregivers because men are incapable of

caregiving– No emphasis on extending family values to public arena;

greed is good – e.g. Enron, Accounting Industry

• Women’s altruism• Self Interest• Equality versus Difference

– Men realize moving into areas inhabited by women entails a loss of status and income eg: nursing school

– Pointless to assign economic value to housework

Liberal Compassion Fascists

• Empathy for others is viewed as dangerous• Women should be empathetic while men

should not• Patriarchal coercion unacceptable?• Selfish individualism?• Obligation to care for one another?• Milk of human kindness a product of supply

and demand?

The Care Penalty

• The Nice Person’s Dilemma– Opportunists will take advantage of those who are

generous & cooperative

– The risk of default is high, e.g. study groups

• The Risks of Caregiving– Altruism reduces available resources for yourself

– Competitive disadvantage

– No guarantee of reciprocity (breaking up is hard to do; children who “didn’t ask to be born into this family”)

The Care Penalty continued

• The Good Parent Dilemma– One parent puts the children ahead of her career with

some expectation that “her turn” will come later– Alternative when the implicit agreement is violated is

to end the relationship which is extremely negative for all involved

• Fairness and Reciprocity– Probably evolved because they encourage cooperative

behavior that is productive long term– Ultimatum game

Children as Pets or Public Goods• Argument:

– Parents acquire children because they provide companionship and love

– Children = pets

• Pets– Provide companionship and love exclusively to the owner

• Children– 1.45 million over 22 years (estimate)

– The childless can invest this money in the stock market

– Children pay taxes as adults, financing retirement benefits

– Parental investment benefits society

The state and childrearing• Nations gain from developing capabilities of

children• How are the costs of childrearing distributed?

– Families allowed a dependent tax deduction– Tax credits– Public assistance for poor parents w/young children– Foster care system– Public education– 1992 – governmental spending accounted for 1/3 of total

spending on children (Haveman and Wolfe)• This calculation does not account for lost earnings as a result of

providing care

Government “support”• Government support for education is up• Government support for families with children is

down• 1948-1960 few families paid tax because the value

of support was high• 1960-1985 inflation eroded this value• Tax rate of families with two children increased

43% while the tax rate for families without children remained stable

• 1998 Congress added $500.00 to the credit for children – not at the same percentage of income as in 1940s– If at the same percentage the credit would be 7,000.00

More “support”

• 1998 $2,700 per dependent child– Families earning +$189,950 not eligible for the

credit

• For families without significant income– Not paying taxes– Therefore do not receive the credit– Therefore do not receive ANY governmental

support

Inequality among families = inequality among children

• Families spend:– 25-30% of income on 1 child

– 35-50% of income on 2 children

– Temporary Assistance to Needy Families

– Earned Income Tax Credit• Refund

• No benefits beyond 2 children

• Amt of support received by poor families is slightly more than those offered to affluent families and families in the middle receive the least amount of support

Irrational anger at welfare• Citizens conceptualize welfare as lots of something

for nothing• “something for nothing” is loosely defined

– Tax deduction on interest paid for house mortgage is not counted even though this deduction alone costs the government twice as much as it spends on low income housing

– 1999 family in 31% tax bracket $1,352 in deductions does not count as something for nothing

– 1999 TANF recipient $1,630 per year per child does count as something for nothing.

• TANF had strict standards, income, wealth, time limits, work requirements = no such requirements for the 31% tax bracketers

Government subsidies• EITC recipients (limit 2 children)

– Average $1,662 per child

• Medicaid– Health insurance for poor

• Food stamps• Dependent care pre-tax accounts

– Up to 5,000 per year can be set aside and exempted from both income and payroll taxes

– Savings for citizens ranges from $200-1,980 per year

• Medicare– Health insurance to citizens aged 65 regardless of income

• Employer contributions to retirement and health care tax exemptions

Social Security and Welfare: The ultimate Double Standard

• Citizens paying social security payroll taxes have a death benefit from the government

• At death children and dependents eligible to receive a check from the government – “survivor benefit”

• 1997 survivor benefit average was 6,012 per child and $6,264 per widow/widower = 18,288 for family of 3– Total federal expenditures = $55 billion– Not welfare – a good benefit

• Maximum TANF benefit to poor is $4,548 family of 3– Total state and federal expenditures = $33 billion– Welfare that encourages people to be slothful and engage in criminal

behavior!

The problem is one of semantics. How do you define INSURANCE?

Who are the people receiving the bulk of the federal monies dedicated to responding to 9/11 disaster?

Poverty and Kids

• Head Start or Catch Up?• USA versus France

– Child poverty rate USA 17%, France 6%

– Maternity leave USA 12 weeks unpaid, France 16 weeks paid @ 84% with optional extensions without pay

– Government support USA TANF $4,000 per family (if you meet all conditions), France government allowance to all families for children beyond the first

Public Education• Education is the responsibility of the states• The states have delegated that responsibility to

subunits, usually counties• Counties further divide into school districts• These are all artificially created boundaries to

geographically define an area.• The finances of public education are based on

these defined boundaries– An effort to keep schools “local”– Once race segregation was made illegal, systems began

the process of economic segregation

A controversial view?

“Our economic system cannot accommodate equal education. The country needs

garbage men, mailmen, waitresses and hamburger flippers. There are only so

many jobs available for college students” (quoted in Folbre 2001, 152).

State Universities• Higher drop out rates at larger universities

– Responsibility is difficult to sustain– Motivation? Average wages in terms of real purchasing

power are lower than 1970 wages– College graduates are the only workers whose wages have

increased

• Public universities exist in a narrowing arena of available public funds– UNCW permanent cut of 10% (2002 – 12,000 per student

subsidy) – Value to subsidizing higher education?– Example: cost is higher to maintain inmates in Huntsville,

TX prison than to pay for four years at Harvard!

Public Education

• The Folbre position– Higher education develops greater capabilities

– Public funding of higher education equalizes opportunity for citizens who are not already wealthy

– Government continues to provide tax subisides and breaks to wealthy institutions

• Eg: Harvard endowment is 13 billion dollars @ 10% rate of return Harvard increases this by 1.3 billion tax free dollars

• Taxing these assets at the 30% rate $390 million could be raised

• This would be Robin Hood. Why should we re-distribute money? Why should Harvard (all U’s) be tax exempt?

Equal Opportunity for Children

• Is different from E.O. for adults

• It must be constructed

• What would public education be like with all children present?