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 âjob-killingâ 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 3- and 4-year-olds 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 three 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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