Duggar Economics: The Costs of 19 Kids
By JONATHAN V. LAST
available at http://online.wsj.com/article/SB10001424052970203917304574413792994350108.html?mod=googlenews_wsj#articleTabs%3Darticle
Jim Bob and Michelle Duggar made headlines recently when the Arkansas couple announced that they are expecting their 19th child. The news about the reality-show stars was met with quiet condescension by polite society and impolite mockery in the trendier parts of the Internet. The dirty jokes write themselves.
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There are scores of reasons for society's decreased fertility.
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Even as economic incentives for childbearing have diminished, costs have grown. The welfare state required an enormous new tax burden, for instance. When Social Security was first instituted, in 1937, only 1% of earnings up to $3,000 were taxed. Today Social Security and Medicare eat up 7.65% of earnings up to $106,800. According to a study by the Tax Foundation, the median American family in 1955 paid 17.3% of its income in taxes. By 1998, the median two-earner family paid 40.9%. All of which makes family formation much harder. As demographer Phillip Longman observes, young white men since the 1970s have seen a 40% decline in income relative to their fathers—for young black men the figure is 60%.
While the government started taking more of a family's money, the expense of raising a child shot to the moon. The Agriculture Department estimates that the costs of raising a child from birth to age 18—that is, clothes, food, health care—averaged $207,800 in 2007. In real dollars, that's a 15% increase since 1960. But the department's numbers leave out three big-ticket items: child care, college tuition and forgone salaries.
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During the past 35 years, the real-dollar cost of college has increased by 1,000%. That's not a misprint.
Finally, there is the opportunity cost of a parent not working. Every family's situation is different, but demographer Phillip Longman gives us an illustrative example: If a parent making $45,000 a year stays home with a child until the child begins school, and then returns to work part time until the child graduates from high school, she is forgoing more than $800,000 in lost wages (counting normal inflation and raises).
When you add it all up, it's not uncommon for a single child to cost a normal, middle-class family something like $1.1 million, from birth through the undergrad years.
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The Duggars have mortgaged their financial futures for their children. Yet we're the ones who will benefit. In 1940 there were 160 workers paying the tab for each person collecting Social Security. By 2006, there were just 3.3 workers supporting each pensioner. The Social Security Administration estimates that by 2034, there will be only 2.1 workers for each person collecting a government retirement check.
In an era when it is rare for a bourgeois couple to have even three children, the Duggars are helping subsidize our retirement at considerable costs to themselves. Instead of mocking them, we ought to thank them.
Posted by A Simple Man at Thursday, October 01, 2009