Postmaterialism and Cohen's Maxim

It is a commonplace on the left that “programs for the poor are poor programs,” the second ‘poor’ meaning “poorly funded.” Call this “Cohen’s Maxim” after Wilbur Cohen, a chief architect of Social Security. Cohen’s Maxim is likely true when wealth transfer programs targeted to the poor are very unpopular relative to “social insurance” that is heavily marketed as “universal.” Yet if the idea is to secure a certain level of benefits for the genuinely needy, the universal social insurance scheme (which will waste a lot of money by taking it from the middle and upper classes and then giving most of it back to them later) will tend to be much more expensive than the targeted transfer scheme. Other things equal, one should prefer the means-tested program, since it frees up resources that can be used to (a) make the targeted benefits larger, (b) sent back to taxpayers while leaving the poor no worse off, or (c) spent on other desirable social programs. The only reason to prefer the social insurance scheme (if the point is to help the poor) is if there will otherwise be insufficient political support to keep benefits for the poor at a decent level.

Under what conditions would we expect Cohen’s Maxim to be true? Conditions under which the middle and upper classes tend to resist financing welfare transfers. They might resist for ideological reasons, in which case Cohen’s Maxim will rise and fall with trends in ideology. But they might also resist for reasons of perceived economic self-interested, which in turn might to some degree drive trends in ideology. What if past a certain threshold in income and wealth, voters became more concerned with questions of fairness and justice and less concerned with their own perceived economic interest? That’s Ronald Inglehart’s “postmaterialism” thesis in a nutshell, and it appears to be well-supported by evidence. We may be seeing it in the move of wealthy voters toward the Democratic Party. Obama’s win over McCain among the wealthiest voters might be because he promised to tax them more and spread the wealth around. 

Suppose this trend continues and, as the median income rises, an ever larger portion of voters above the median comes to prioritize social justice over tax rates. Under those conditions, why think Cohen’s Maxim would hold? 

By the way, I’ve always rejected Cohen’s Maxim. Unemployment benefits are targeted, but generous and popular. My favorite argument against making Social Security into a means-tested program is that benefits would likely to be too generous, generating serious moral hazard while being unjust to boot. The core of this argument is the disproportionate heft of retirees as a voting bloc, and the relative unity of their interests. Forced intrapersonal transfers are preferable, my argument goes, to exploitative, class-based (younger to older) interpersonal transfers. But if economic growth makes us ever less fixated on our narrow our economic interest in the voting booth, this argument could break down, too.

So could postmaterialization someday put us in a position where it becomes feasible to get rid of elaborate schemes like social security and medicare–and even the personal account alternatives to these–and go with the most direct, efficient, and transparent safety net policy? Provide government assistance to people who fall beneath a certain minimum of resources. Otherwise, don’t. 

Related: Here’s my colleague Jagadeesh Gokhale smacking down some bad arguments for the Social Security status quo.

Wishing Daughters Ill

I’m not sure Bryan’s adding much to his initial posts. Most importantly, he still seems to avoid my main point: children are costly to women in terms of education, career, income, status, and happiness, and most likely devastating to a teenager. I simply don’t see that these points have been addressed. Bryan basically keeps insisting on asking whether you, the parent, would rather your daughter produce a grandchild as a teen or produce none at all. Given everything we know about how teen motherhood tends to limit girls’ life prospects, and how ceterus paribus childlessness will leave her as well off or better, Bryan’s insistence that he’d rather risk the ruin of his daughter’s potential than have her go childless strikes me as perverse. I simply can’t make any sense of it.

Bryan says, “I think that a lot of parents would share my preference if they calmed down and weighed the alternatives.” Maybe. But why? AGAIN the evidence I cited, which Bryan ignores, is that she will be less well educated, poorer, lower status, and less happy. What kind of person wants this for his or her daughter? The only way I can make sense of this is to imagine Bryan thinking that a woman’s life is in some sense deeply incomplete without having reproduced, so just about any cost must be worth it. Bryan, please tell me that’s not it!

One might think powerful, gifted women like Ayn Rand, Camille Paglia, Simone de Beauvoir, Jessye Norman, Frida Kahlo, Harriet Tubman, Oprah Winfrey, Katherine Hepburn, Dorothy Parker, Condoleeza Rice, etc., etc. might, in some respect or other, be good role models for girls. But since nothing could be worse than not ever having a baby, I suppose Britney Spears’ idiot little sister outshines them all!

Family Feud

Bryan Caplan kindly addresses my brazenly psychologizing argument against his Jamie-Lynn apology. I’m sure we’re talking past each other a bit, but that’s okay!

… if I’m reading Will correctly, he’s saying that there is a gender conflict on the issue of family size: Men want more kids than woman because women get pregnant and do most of the child-care. The problem with this story is that, empirically, desired family size for men and women is practically identical. In the GSS, the average response to the “ideal family size” question is 2.57 kids for men versus 2.56 for women. Indeed, if there is a gender conflict on this issue that the data doesn’t capture, it’s between women who want kids, and men who don’t. (See I Want a Baby; He Doesn’t).

Hmm… I’m not saying there is a gender conflict about family size.

Since we were talking about sixteen year-old girls, I was specifically pushing Bryan to grasp that the cost of having children for non-wealthy girls of that age is high; it may ruin their chances of realizing anything approaching their full potential or of achieving much that is accorded a high level of social esteem. And it turns out that most girls are not wealthy, or of wealth. I wasn’t making any point at all about desired fertility or family size. I was saying that having a child at sixteen has a VERY HIGH probability of severely limiting most girls’ prospects. It seemed to me that Bryan was overlooking this pretty obvious fact, which suggested to me a lack of sympathy for the cost of motherhood to teen girls, which further suggested a lack of sympathy for the cost of motherhood to women generally. Jamie-Lynn is a poor example for girls because she is doing something that would do a lot of damage to most girls’ lives, which is why most parents are not unreasonably terrified of this kind of thing regardless of their interest in grandkids.

But let’s talk about “ideal family size” anyway! I find survey evidence about desired family size or desired fertility pretty irrelevant in a way economists ought to be especially sensitive to. If you ask me how many cars, houses, or television sets I would ideally own without specifying the price I may well give you a pie-in-the-sky answer. I would like TEN cars! But given a world in which I face my actual budget constraint it turns out that I want one cheap car: a 1996 Honda Civic.

In the case of desired fertility, I think lagging social expectations and norms likely play a huge role. I suspect we take the size of our own families growing up as a kind of baseline for our family formation preferences. But as women’s equality has proceeded, and continues to proceed, the opportunity cost of pregnancy, childbirth, and childcare has risen, and is rising, for many women. So it would not be surprising if a young woman were to imagine that she would like three kids, given her mom’s 1985 opportunity cost. But given 2008 opportunity costs, she really only wants one, which is what she has. I don’t know if there is a male-female mismatch in preferences here, and I guess I don’t care much. It’s not what I was talking about, in any case.

Moving on…

Now admittedly, Will could rephrase his question in a gender-neutral way: “So what’s the problem with a person who decides to devote his/her life to meaningful life-constituting projects that do not involve [insert gender-neutral unaesthetic stuff about kids here]?” If so, my short answer would be:

1. It’s not hard for a person to do both, especially if he/she is reasonably affluent.

I don’t want the question to be gender-neutral. The point is that having children isn’t gender neutral. Women carry most of the burden.

Isn’t pregnancy hard? Childbirth? Don’t women worry a great deal about what all this does to their bodies and their sense of physical self-esteem? Doesn’t childcare have real costs in terms of competitive careers (i.e., almost all of them)?

I’d be more comfortable with “it’s not so hard” if social norms weren’t so brutal to middle-class, middle-American women who chose to outsource almost all their childcare in the same way men continue to outsource almost all their childcare to their wives. But, as it stands, I think even the average “reasonably affluent” woman bears a pretty big disproportionate burden and this is in fact reflected in diminished labor market prospects. Indeed, mothers face disadvantages in hiring, the wage gap between mothers and non-mothers is bigger than the wage gap between women and men, and according to some studies it is increasing. Nope, not hard at all!

2. A person who does both will almost certainly be glad that he/she did (whereas many successful childless people (especially women!) regret their choice.

Yes, I think it is part of our Darwinian design to mostly keep us from regretting our children, even if the choice was regrettable or in moments of reflection actual regretted. Also, it is taboo to admit regretting your children, even if in a mixed and complex way. But if Bryan thinks many, many, many mothers have not and do not in fact regret foregone experience, challenge, success, and status then I fear he’s not paying attention. Motherhood for many women just is a bittersweet experience of frustrated ambition and readjustment to downgraded expectations. Several times my own mother, who I’m sure loved me and my sisters without reserve, expressed to me deep regret for not having gone on to become a doctor instead of ending her education with nursing school in order to raise a family. That can’t be hard.

Anyway, if a career woman past reproductive age finds herself regretting not having children, she can always adopt. But try getting rid of your four year-old, and see what people think of you.

3. The person you create will almost certainly be really glad to exist.

If I gave somebody a million dollars, they would almost be certainly glad to get it. That’s some reason for me to give someone a million dollars, I suppose, but not really much of one.

4. If you think you own any debt of gratitude to your parents, giving them grandchildren is the best way to repay it.

Just being there, loving them, and loving your own life is the best way to repay, I figure.

Maybe Bryan is right that the rewards of family make it all worthwhile in the end. Lots of people certainly say so. But I continue to worry he is being a bit too facile about the high costs of childbearing and childrearing for women generally, not to say for teenage girls.