Innovative ways to stimulate the economy: A parental stipend for working families
Apr 5th 2009 1:30PM
Updated Dec 4th 2009 1:18PM
This is just one of the Innovative Ways to Stimulate the Economy suggested by DailyFinance contributors. See them all.
During a recession, public policy officials have to get creative. Certainly they've done just that during the current financial crisis and economic slowdown. Still, despite a number of appropriate, innovative public policies, and some yeoman's work by the Fed, the reality is that the U.S. economy will need more stimulus in the year ahead. One option policymakers should consider: instituting a parental stipend or child-rearing payment.
Selected feminist scholars, at least historically, have looked on the modest daycare/child care support system in the United States as indicative of a culture and a society that favors men. For example, they argue that work traditionally done by men (mostly outside the home) was compensated by society, but work done mostly by women (including parenting) was not. They've argued that the framework is unjust because it calls for women (or homemakers) to provide free labor to society -- thereby reducing their economic, political, and social power.
Conversely, other scholars argue that since the homemaker role is in a family, it benefits the family more than it does society, hence it does not constitute work "for society" and therefore should not be compensated by taxpayers.
The latter argument, and the private-sector-solution-first/public-sector-solution-second culture, are two reasons U.S. child care, day care, and family leave tax credits and programs have lagged other European democracies.
Still, the child-rearing program proposed here would take a different tack. In order to stimulate the economy, it would pay one parent per household -- either a stay-at-home mom or dad -- a monthly stipend for parenting or child-rearing work and responsibilities.
The program would have the following benefits, among others: 1.) It would stimulate the economy by increasing per-family wages earned per month. 2.) In the case of households where a parent has lost a job -- unfortunately, a large number of households today, due to the pronounced recession -- it would represent a needed, minor source of income -- in many cases, income that would be used to meet living expenses. 3.) It would recognize, in some small way, the importance, social worth, and value of child rearing.
How much should the monthly parental/child-rearing stipend be? Ideally, it should start at $400 per month per household, with a maximum $700 per month payment for high cost-of-living areas (such New York City, Los Angeles, Boston, San Francisco, Washington, DC). Families currently receiving income maintenance from states and/or the federal government would not be eligible.
This being the United States, not France or Sweden, the reality is that the political culture probably would not support a monthly stipend that high. A $200/$350 monthly stipend would have a better chance at passage.
Could a modest parental pay program pass in the current economic and political climate? It's possible, but congressional Democrats and the Obama administration won't seek it, as it would use political capital needed to address the nation's other pressing concerns. Almost all congressional Republicans would likely oppose the measure.
Economic Analysis: Extraordinary times require extraordinary measures. A monthly parental stipend would add much-needed income to families, and undoubtedly at least some of that income would be spent stimulating the economy, while also standing as the U.S. government's formal recognition of, and public support for, parenting.
Economic stimulus and recognition of the merits of parenting in one policy; the view from here argues that's a win-win situation for the nation.
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