Ottawa Isn't Making It Easy To Have Children

Last week, I described the dangers posed by Canada's low fertility rate: 1.5, less than three-quarters the number necessary to replace the existing population. (That column can be found in the 2004 archive of my Web site, www.davidfrum.com.) This week, it's time to talk about answers.

Children are expensive. Many governments -- including Canada's -- try to help parents raise them with subsidies and support. Canada, for example, offers a large monthly per-child cash payment to poor parents and a smaller per-child payment to middle-income parents.

Most of the provinces offer subsidized daycare programs. Ottawa is now considering a national daycare program. Federal tax policy already allows parents to deduct up to $7,000 per year per child in childcare expenses.

These policies cost substantial sums of money. Plainly, though, they are not working. Indeed, there is reason to think them counterproductive: All these benefits were substantially increased by the allegedly family-friendly federal budget of 1998. Yet in the four years after that famous budget, Canadians gave birth to 150,000 fewer children than they did in the four years before the budget.

What went wrong? Canadian family policy seeks to help working mothers, especially lower-income working mothers. But policies that aid a working mother struggling to raise a child do not help -- and, indeed, actively discourage -- the married family considering whether to have a second or third child.

From the point of view of married couples, daycare is not an attractive option. Often they would prefer that the wife stay home altogether. Canadian families that make that choice, however, are abruptly cut off from public support -- and then subjected to punitively higher taxation.

Childcare expenses are deductible only from the lower of the two incomes in a household. So while a working mother may deduct $7,000 per child for the daycare that allows her to go to work, a family in which the mother earns no cash income cannot deduct even the few hundred bucks they pay a babysitter so that the mother can have an afternoon off once in a while.

The federal child benefit likewise offers little help to two-parent families. The average two-parent , one-earner family earns more than $55,000 per year. The average two-parent, two -earner family earns almost $80,000. The federal government begins clawing back child benefit at just $35,000.

Canadian families in which one spouse focuses all his effort on work and the other dedicates herself to home pay dramatically higher taxes than equally situated families in which both parents work. The Fraser Institute notes that a married man supporting a wife and two children on $50,000 per year can expect to pay about $4,600 in federal taxes. A family in which two partners each earn $25,000 will pay only about $2,100. Equal income, double taxes.

Lower taxes are always good for families. But it's even more important that taxes be lowered in ways that stop punishing families in which the mother leaves the workforce to stay home and raise children, because it is those families that produce the most children.

Yet tax relief alone won't do the job. The more children a woman has, the more dependent she is on the man in her life -- and the more vulnerable she is. Marriage laws that make marriage insecure together make child-bearing an increasingly dangerous choice for women. Many women respond by postponing child-bearing until they feel economically secure, until their middle or late 30s. But women who wait so long to have their first child are less likely to have a second -- and much more likely to find themselves having none at all.

The great American sociologist James Q. Wilson has argued that a woman who devotes her twenties and thirties to the raising of children should be seen as something like a soldier who devotes his young years to the protection of society -- and should be regarded as eligible for something similar to veteran's benefits.

For example, like most social security systems, the Canada Pension Plan pays out less or more according to the amount paid in. Recognizing that this rule could reduce the pensions paid to women who leave the workforce to raise children, Canada allows pensioners to exclude their lowest-contribution months from the calculation of their pensions. That's an interesting start. Why not go further and allow women to count time spent at home with young children as an affirmative contribution to the system? What if it were possible for a mother of three or more children to qualify for the maximum pension without working at all?

Wilson has likewise proposed that women who stay home to raise children could be rewarded with scholarships and other advanced educational benefits when they are ready to return to the workforce.

Even if benefits like pensions and scholarships do not quite altogether compensate women for the income they lose by having children, they can still have a powerful effect by sending a powerful message that marriage and child-rearing are honourable life choices, to be respected and rewarded. This is the very opposite of the lesson Canadian and other advanced societies now teach their children, and especially their girls. And guess what? Societies that teach disrespect for the work of raising children find that they don't get very many of them. Perhaps societies that rediscovered that respect might rediscover also their lost fertility -- and their hopes of survival.