The paternalism of paid parental leave

These aren’t just broad arguments in support of helping working parents — they inform the structure of the policy the group proposes. It pushes new parents along a specific path. They will pay for the benefit through higher taxes whether they like it or not, for the entirety of their working lives, and when the time comes along that they’re eligible to take leave, it’s “use it or lose it.”

A deep problem with the proposal, and indeed with the very concept of paid parental leave, is that it blunts the natural incentive for parents to go back to work promptly. Let’s say you’re entitled to 70 percent of your pay for staying home; but if you work instead of staying home, you get this 70 percent plus the remaining 30 percent (for full pay) — so you’re really working for a mere 30 percent of your pay (minus commuting expenses and the like). The point here is not that families should make one decision or the other. The point is that people should have the option of going back to work early and getting paid to do so — i.e., that they should evaluate the tradeoff themselves rather than watch helplessly while the government slams its fist on the scale.

There are a few ways one could restructure the policy to make it more conservative-friendly. One approach, embraced by a few members of the working group, is just to shrink it. A benefit that topped out at $300 a week would be a great help to a minimum-wage earner while just offering some starter funds to those in the middle class and higher, who are more likely to have paid leave from their jobs and more able to save money ahead of time if they don’t. (Frankly, if you’re making a middle-class income and can’t be bothered to save up for leave, that is your problem.) As the report notes, a skimpier government plan would also reduce “crowd-out,” the tendency for private employers to drop their plans when the government starts providing one.