Romney’s Family Security Act is not pro-life economics

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About 60% of abortions are performed by single mothers living in poverty, so Roe v. Wade by the Supreme Court pushed politicians to call for a pro-life economy. They seem to think that reducing poverty will end the need for abortions. Of course, socialists always thought they could perfect humanity by getting rid of poverty.

The pursuit of a pro-life economy inspired politicians to dust off Mitt Romney’s Family Safety Act he announced in February 2021. According to his website, the Family Safety Act would “…create a new commitment to American families by modernizing federal policies to a monthly cash benefit of $350 per month for each young child and $250 per month for each school-aged child.

Democrats don’t like the plan because Romney would cut other programs to pay for it. Republicans don’t like it because it’s just more welfare. Christians should oppose it because of the moral hazard it creates. Romney’s plan falls into two traps: moral hazard and homo economicus mistake.

Romney, like most politicians, does not understand moral hazard, one of the most important principles of microeconomics. Moral hazard teaches us that if you eliminate the consequences of risky behavior, you get more risky behavior. The typical example is insurance; Having insurance to pay for damage to your car after an accident motivates many people to drive more recklessly.

Hurricanes cause far more property damage today than in the past due to federally subsidized insurance. Before the 1960s, only the poor lived near the beaches, where land was cheap. Land was cheap because no company insured houses built so close to water, due to the threat of tidal waves and hurricanes. The wealthy kept their homes safe inland. Then politicians, in their infinite wisdom, decided to force taxpayers to subsidize the cost of insurance for the wealthiest on property considered too risky by insurance companies.

Any freshman in an introductory economics class could have predicted the results: Wealthy people gobbled up beachfront properties and built mansions by the water or in the water . Risk? Absolutely, but they didn’t care because the taxpayers helped pay for the cost of their insurance. They could easily rebuild, and many have done so multiple times.

The Federal Reserve’s monetary policies also create moral hazard problems. Economists have complained for decades that low interest rates set by the Fed encourage people to invest in riskier businesses than they would if interest rates were higher. Then, when interest rates rise, those bets fail.

Taxpayer-paid abortion has taken away some of the inconvenience of getting pregnant when women don’t want it. There was no need to bother with birth control. In the same way, if we take away all the discomfort of having children and pay poor, young, uneducated girls to have them, they will get more than they otherwise would.

To avoid moral hazard, we must look to the future. Jesus warned his disciples to count the price of following him. “Which of you, when he wants to build a tower, doesn’t first sit down and calculate the cost, to see if he has enough to complete it?” (Luke 14:28:28). This is great advice and it could rid us of the undesirable consequences of moral hazard if people followed it. Yet politicians like Romney want us to believe that there are no costs to their policies, only benefits.

Politicians will complain that opposition to Romney’s plan is heartless, but madness is not compassion. Allowing sin is not compassion. Dr. Thomas Sowell explained moral hazard in such welfare programs: “Nearly a century of ‘supposed legacy of slavery’ [78%] raised in two-parent families in 1960. But thirty years after the liberal welfare state, the vast majority of black children were raised by a single parent [66%].” Dr. Sowell wrote this decades ago. The percentage of children born to single parents is now higher among blacks than among whites. Essentially, “compassion” for poor mothers has increased their numbers dramatically, and with devastating consequences: the sons of single mothers constitute the majority of criminals.

Marvin Olansky’s book, The Tragedy of American Compassion, shows that blind giving, as Romney proposes, does little more than encourage more people to stop working and live off the work of others. And it will encourage poor, single, uneducated women to have more children for the income they generate from the government.

There is no solution to the problems of unwanted pregnancies, but if we removed the incentives, fewer single women could become pregnant. In the past, moral concerns kept single women chaste and those who became pregnant lived with their parents. But few people care about morality today except for conservative Christians, and single mothers see no reason to submit to the discipline of their parents when their daddy, the feds, will take care of they.

And Romney’s plan will hurt middle-class families who have to foot the bill. Yes, Romney says his program would be fiscally neutral by cutting other programs. But we’ve been suckers for that snake oil for decades: Congress always votes on spending, but never on cuts.

Christians can help alleviate (but not eliminate) the difficult lives of single mothers by getting to know them and supporting those who commit to having no more children until they marry. Many churches have programs to provide free car maintenance and rental assistance. But federal programs are increasing the number of single mothers so much that the church’s efforts are becoming like trying to drain the ocean. Romney’s plan would make the problem worse.

Finally, Romney and his supporters fall into the homo economicus mistake. Homo economicus, the hero of mainstream economics, only cares about money in life. He or she puts a price tag on everything. In the context of abortion, the only algebra needed is to compare the cost of an abortion to the cost of having a baby.

Homo economicus is needed for the very limited calculations that economics does, supply and demand and all that. But it becomes grotesque when introduced into the more sophisticated world of political economy that most people are interested in because we know that people decide things for many reasons other than money: for example, the love, religion, charity, morality, etc.

Most pregnant poor single mothers give birth. According to the CDC, “…the abortion rate was 195 abortions per 1,000 live births.” If 60% of births and roughly the same percentage of abortions are to poor single mothers, then five times as many poor women give birth as abortions. Why do so many poor women have babies and don’t abort them? Obviously, money is not the issue. Romney just wants to throw more money at the problem.

Like doctors, politicians should first try not to do harm and if they have caused harm, stop it. The first step would be to end state subsidies for poor, uneducated single mothers with babies. We have enough children without a father. The second step is to free the economy from government shackles so it can create jobs for these young women and lower taxes so that working poor families keep more of their income. Third, use DNA testing to find the fathers and make them pay child support. But the only solution to the problem of unwanted pregnancies, ultimately, is for more men and women to become followers of Christ.

Roger McKinney is the author of Financial Bull Rise and God is Capitalist: Markets from Moses to Marx.

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