Biden’s US family plan will help create jobs

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Beware of the Conservatives: If the main elements of President Joe Biden’s American family plan become law, they will be very difficult to repeal. Why? Because they will bring huge, even transformational, benefits to millions of people.

I mean, just imagine trying to take away affordable child care, universal and paid preschool leave for new parents once they’re part of the fabric of our society. You would face a far worse backlash than the one that followed Republican attempts to eliminate protection for coverage for pre-existing health issues in 2017. And that backlash quickly gave Democrats control of the House and set the stage. for their current control of the Senate and Whites. House too.

So what’s the Republican counter-argument? Well, much of the party seems indifferent to debating politics, preferring to go after imaginary plans to ban red meat or give immigrants Kamala Harris’s children’s book.

The official GOP response to Biden’s speech on Wednesday, by Senator Tim Scott, seemed low-energy; Scott always complains about the “big government” and denounces Biden for spending money on things other than roads and bridges. The closest thing to a real argument was the claim that Biden is proposing “the biggest job-killing tax hikes in a generation” – presumably a reference to Bill Clinton’s 1993 tax hike. .

Indeed, Biden intends to pay for his proposals with higher taxes on corporations and high-income individuals, including a despicable plan to give the IRS enough resources to crack down on tax evaders of the rich. .

It is therefore important to understand that the family plan would, if adopted, be an important creator of jobs. That is, it would dramatically increase the number of Americans – women in particular – in paid employment, likely by several million.

To understand why, the first thing you need to know is that while Republicans always claim that raising taxes for the rich will destroy jobs, they were never right. Scott’s reply to Biden seemed to suggest that Clinton’s 1993 tax hike had killed jobs; in fact, the United States added 23 million jobs under Clinton’s watch. We also seem to forget that Barack Obama presided over a significant increase in high-end taxes at the start of his second term; the economy continued to create jobs rapidly, at a rate of around 2.5 million per year.

Oh, and jobs in California exploded after Jerry Brown raised taxes for the rich in 2012, defying conservative claims that the state was committing economic suicide.

It is also instructive to compare the United States with other advanced countries, which almost all have higher taxes and more generous welfare benefits than we do. Are they paying the price for these policies in the form of reduced employment?

Many Americans would, I suppose, be surprised to learn that the truth is that many high-tax, high-yielding countries are quite successful at creating jobs. Take the case of France: adults between 25 and 54, the first years of work, are Following likely to be employed in France than in America, mainly because French women have a higher wage employment rate than their American counterparts. The Nordic countries have an even greater advantage in employment for women.

How can employment be so high in countries with a lot of “job-killing” taxes? The answer is that taxes don’t visibly kill jobs, but the lack of child care does. Parents in many rich countries can accept paid work because they have access to safe and affordable child care; in the United States, such care is prohibitive for many, if they can get it. And the reason is that our government spends next to nothing on child care and preschool; our spending as a percentage of GDP puts us a little below Cyprus and Romania.

The US Family Plan would completely change that picture, offering free preschool for all ages 3 and 4 while limiting child care costs to no more than 7% of income for low- and middle-income parents. If this increased the employment of prime-age American women to French levels, it would add about 1.8 million jobs; if we went to the danish level, we would add 3 million jobs.

To be clear, allowing more women into paid employment is not the main point of this plan – and there is nothing wrong with parents choosing to stay at home and to take care of their children. Instead, it is mainly about improving the environment in which children grow up, in part for reasons of social justice, in part so that they end up growing into healthier and more productive adults.

But a higher employment rate – jobs generally expand to meet the available labor force – would be a significant and more immediate side benefit. And it would also offer partial tax compensation for the direct cost of child care and preschool, both because new American workers would pay taxes and because they would be less likely to need the support. social protection programs such as food stamps. No, Biden’s spending plans won’t pay off. But they will cost taxpayers less than the numbers suggest.

And if these plans improve the lives of millions of Americans, will anyone other than professional ideologues care about being a “great government?”

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