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This is the fourth in a series of blog posts on paid family leave jointly sponsored by AEI and Brookings. Aparna Mathur at AEI and Isabel Sawhill at the Brookings Institution are the co-directors of the AEI-Brookings Project on Paid Family Leave. The project includes a diverse group of individuals from different organizations with expertise on this topic. Following our initial blog post to tee off the series, we have invited each of the working group members to offer their thoughts on the topic. This week’s contribution comes from Abby McCloskey, founder of, McCloskey Policy LLC, former advisor to Jeb Bush and Rick Perry, and former program director of economics at AEI.
We invite you to engage with us as a new administration takes office and charts out policies on these topics. This will help us better inform policymakers of the practical day-to-day realities of living in a country where millions lack access to paid leave at the birth of a child or to meet other caregiving needs.
— Aparna Mathur
Frequently asked questions about paid leave from a Republican perspective
Over the last few years, I’ve had numerous conversations with political leaders about the opportunity to introduce a paid parental leave policy. Several of the same questions and concerns tend to pop up among conservatives, which I would like to address here, considering that the new administration and Congressional majority are Republican.
For clarification, paid leave takes numerous forms, but I will be discussing a federal paid parental leave policy available to all new parents for the birth or adoption of a child.
Won’t the free market take care of it?
In an ideal world, yes. But while many companies offer paid leave, the vast majority of companies do not. According to a Department of Labor study, only 12% of employees have access to paid family leave from their employers. This drops to 5% for employees in the bottom quintile.
While it is true that employees can sometimes patch together sick days and vacation days to cover extended absences, as many as half of working mothers give birth without access to paid leave in any form.
Lack of paid parental leave is especially problematic for single parents, who have no income to rely on other than their own, and for low-income households, who do not have the savings necessary to last weeks or months without income. Nearly a quarter of women return to work within two weeks of giving birth, according to a report by Abt Associates.
We can’t afford a new government program or higher taxes.
As a fiscal conservative, I am wary of a new government program or additional government spending. Similarly, I do not want to levy higher payroll taxes, which reduce take-home pay at a time when so many Americans already struggle to make ends meet.
There is a strong case that providing a minimum level of support for new parents should qualify as a basic element of the safety net, while tripling the disability rolls or providing Social Security benefits to millionaires might not.
But a modest paid parental leave program could be paid for by cuts to existing spending instead of new taxes or mandates – keeping the size of government exactly the same. There is a strong case that providing a minimum level of support for new parents should qualify as a basic element of the safety net, while tripling the disability rolls or providing Social Security benefits to millionaires might not.
Furthermore, a paid parental leave plan can be structured – in the duration of benefits, size of benefits, and eligibility of benefits – in a way that contains costs. For example, President Trump’s paid maternity leave plan would cost $2.3 billion per year, just 2% of what the government currently spends on unemployment and disability insurance, although his policy should be expanded to fathers as well. It is also a fraction of the Democrats’ “FAMILY Act” proposal, which includes medical and family leave and has a lower-bound cost estimate of $85.9 billion annually.
It will make people more dependent on the government.
Evidence from states suggests the opposite. A modest paid family leave program improves labor market outcomes and economic independence, with the greatest effects among the least-advantaged families and mothers.
A study of California’s paid-leave program found that the weekly work hours and wages of new mothers rose by 10 to 17%, probably because more women kept their jobs rather than quitting them and seeking new ones once they were ready to go back to work. Numerous other studies have found similar results, that paid leave increases women’s attachment to the workforce.
Because paid parental leave is a pro-work policy, it is possible that it reduces government dependence in the long-run. A 2012 study by Rutgers, “Pay Matters,” found that paid leave reduced a woman’s likelihood of using food stamps by 40% in the year following her child’s birth.
Won’t this crowd out state and private options?
Employers dropping their paid leave programs for a federal program is a real concern. This concern grows with the duration and size of the public benefit offered, if the public option surpasses private ones. This speaks to the importance of having a limited federal policy, where the amount of the benefits is set low enough, and the duration short enough, that it functions as a true safety net for working parents without other options. Such a policy would drastically limit any crowd-out effects.
Won’t this negatively impact employers?
There is little evidence from the existing state-based programs that there are negative employer effects, but this is an area that needs further research. The length of paid family leave in state-run programs is short (four to six weeks). While New York has passed a law to have 12 weeks of paid family leave, the program has not been fully implemented, and thus the effects on employers cannot be determined yet. Again, this speaks to the importance of introducing a limited federal paid parental leave policy to start, and expanding it only after its effects have been further studied.
Can’t we just provide tax credits to employers who offer paid leave? This doesn’t involve a big new government program and wouldn’t increase government spending.
Unfortunately, it is unclear how much an employer tax credit would increase the prevalence of paid leave offered. The anticipated change in access to leave is something that advocates of a tax-credit plan should clarify.
Additionally, it’s important to note that tax credits are not free. They are a form of government spending; it’s just hidden spending in the form of lost revenue. In other words, the government could be losing billions of dollars of revenue to companies already offering paid leave –without any change in access to leave, which is of course the problem that such a policy is originally trying to solve. From a fiscal responsibility standpoint, these resources could be better targeted.
Democrats can always offer bigger and more generous paid leave plans than Republicans because they care less about the federal debt or big government. So Republicans shouldn’t even bother putting out a paid leave policy, which will look measly in comparison.
This logic essentially handcuffs Republicans from putting forward any new policy or program. A false “all or nothing” dichotomy on either side of the political aisle blocks the potential for real bipartisan reform that improves people’s lives.
Republicans shouldn’t get caught up in this trap. The vast majority of Americans, including 71% of Republicans, are in favor of a paid parental leave policy, according to a recent Fortune-Morning Consult poll. Republicans can put forward a paid parental leave plan that is family-friendly, fiscally-responsible and targeted to those who need it most, while encouraging economic independence. They should be clear that this is a starting point, until the effects of such a policy can be fully studied.
While a conservative parental leave policy will not be as large as Democratic proposals, it likely would be more attractive in other areas, such as not adding to the federal debt, not putting burdensome mandates on businesses, and actually being able to pass through a Republican Congress and the Trump administration.
For the millions of parents who have no access to paid leave at all, this would be a big step forward.
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