The GOP Is Reducing Children To Profits, Badly

It appears that the right wing is trying to claim that forcing women to give birth would be good for the economy.

According to the AP, two top Missouri GOP "state officials argued" on 7 June "over how much it would cost Missouri to restore the right to abortion, with" Missouri Attorney General Andrew Bailey "insisting that the figure should account for lost revenue that wouldn’t be collected from people who otherwise would be born."

I have no problem with Bailey’s argument here.

Sort of.

I disagree strongly with his conclusions as well as the utter lack of concern for women’s rights.

However, their argument, from a purely economic point of view, is correct. If you are not born, you cannot work, spend money, or pay taxes, which therefore would reduce the revenue to the state. That fact is an externality — a cost (or benefit) — that is not the main intent. {1}

But if you’re going to look at one externality, you have to examine all of them.

So let’s look at this just as an economics question.

Having a child reduces a mother’s wages and hours worked, but tends to have no effect on the father’s wages. {2} This holds even in countries with far greater social support structures than the US, such as Sweden.

Not only is this effect seen pretty much everywhere, but it is not a new thing, with researchers having seen this effect with "1950s and early 1960s birth cohorts from their first jobs to 1989" in the former Federal Republic of Germany (West Germany) and the former German Democratic Republic (East Germany).

Therefore, any increase in state revenue would be offset — at least in part — by the reduction in the mother’s wages.

While that may appear to be a simple calculation, it is not.

First, the mother’s lowered wages mean a corresponding dip in the local economy. With less income, there is less money to spend. Thanks to the local multiplier effect (except in reverse), that reduction in wages will have a larger negative impact on the local economy than just the original dollar amount of lost wages, and thus will lead to reduced state revenues.

Second, those lowered wages (and lowered state revenue) will continue for years. Not just due to decreased hours working due to the demands of childcare, but also due to the interruption in job progression.

Third, state revenues will additionally decrease for nearly two decades due to the additional exemptions from income tax due to child tax credits and the like.

Similarly, any increase in tax revenue from hypothetical children does not occur until those children begin working. While the GOP seems determined to bring child labor back, that still means that for us to even think about increased revenue from those children, we have to look at a decade or more out from their birth.

So fifth, and finally, that means that all the other losses of income already mentioned have to have their cost increased by not just the lost wages over that decade, not just the lost local economic multiplier, but also the loss of the potential compounded interest from the lost income over that decade or more.

I say "at least," because that is assuming that the lost money would not have been invested in people or infrastructure in ways that would provide further economic benefits — and increased state income.

Those five complications are just off the top of my head and doing a quick half hour of research. I’m certain there is much more research showing other factors I’ve not considered. I’ve also barely touched on the additional costs of having a higher birthrate both for the government and the parents, such as having to increase school funding.

Nor have we discussed the effects of having additional siblings on educational (and therefore, economic) attainment — again, something that has been demonstrated both in the US and abroad.

So sure, we can talk about the economic externalities of having more children. But the right-wing’s strategy of framing abortion restrictions as an economic goal is so oversimplified that it might as well be written in crayon, and utterly disregards the quality of life for both the mother as well as the quality of life for any children they may choose to have.

{1} Libertarians are notorious for not paying attention to externalities when it’s inconvenient.
{2} Genders used here are those used in the original studies. It is probable that the effect noted is affected by underlying societal sexism, but to what degree that differs from the effect of taking time off to have a child is impossible to calculate while there is a disparity in parental leave.
{3} Perhaps we need to sing "Every Sperm is Sacred" at GOP rallies?