Stop Using the IRS To Subsidize Parenting

In response to Biden's child tax credits, Sen. Josh Hawley proposes paying parents $1,000 per month—if they're married—and $500 per month if they're single.

Sen. Josh Hawley (R-Mo.), he of perpetual bad ideas, has a new one: welfare for all American parents, with a bonus payment contingent on whether they're married. As with so many of Hawley's ideas, this one manages to combine the worst of the left and the right.

Hawley's plan comes at a time when both Republicans and Democrats have been pushing more government benefits for parents. The right tends to want more women to stay home with kids, while the left aims to get more moms into the workforce—but in both cases, the goal is to engineer family and work structures through federal fiscal policy. President Joe Biden has called for extending a temporary boost to the child tax credit that was passed as part of coronavirus recovery spending. Sen. Mitt Romney (R–Utah), meanwhile, suggests paying parents $250 to $350 per month per child.

Hawley would make the parent payment $1,000 per month—if parents are married and file a joint tax return. Single parents, or a married parent who files taxes separately from a spouse, would get $500 per month.

You might object that single parents are more likely to need financial help. But Hawley's plan isn't based on need so much as it's based on incentivizing a certain sort of family structure.

"To receive the credit, single-parent households must report prior-year earnings equal to or greater than earned income from 20 hours per week of work at the federal minimum wage, an earnings threshold of $7,540. Married parents that file a joint tax return must reach the same earnings threshold. This creates an explicit marriage bonus of 100 percent," Hawley's website states.

The money—which could be received in an annual lump sum or through monthly payments from the IRS—would go to parents of children under age 13, with no upper income limit for receiving the payment.

Hawley makes no secret of the fact that his marriage bonus is meant to create more stay-at-home parents. "Many parents say they would prefer to stay home with their young children, but simply can't afford it," writes Hawley in a Fox News op-ed, decrying tax laws that "explicitly promote both commercial daycare and two-income households." Parents should not be "treated worse by the tax code for choosing to do the work of raising kids at home."

Many libertarians would agree with that last statement—in fact, they would prefer that tax codes and federal policies stop favoring any particular marital choices, childbearing choices, career choices, or family structures.

But this isn't what Hawley has in mind. Though he speaks the language of choice ("federal policy should let families decide and respect the range of child-rearing preferences held by American families," he writes at Fox), he's simply trying to replace one form of social engineering with another.

Hawley also calls his idea a "tax cut," but that's not really accurate, either. Since it's refundable, people can get the money in excess of what they owe in taxes, making it more like a cash subsidy from the IRS for parenting.

"Some proponents have tried portraying a child allowance as fiscally conservative," noted Naomi Schaefer Riley and Angela Rachidi in a February article for Reason. "But it is hard to understand how the federal government sending monthly checks to almost every child in the country…is fiscally prudent, even if that spending is replacing other welfare programs."

This has become typical for a certain segment of Republicans, who are willing to give up free-market principles when they conflict with their desire to control cultural outcomes.

The modern GOP is becoming "one that combines the cultural impulses of Pat Buchanan and the economic aspirations of Ross Perot," suggested Riley and Rachidi. "The growing natalist movement on the right—which includes but is not limited to religious conservatives—says that it's time we do something about declining fertility rates in this country. Some conservatives are even praising proposals from think tanks with socialist ideas."

Hawley's new plan is akin to the child tax credit favored by Democrats.

Democrats are already talking about making permanent a child tax credit passed as part of the most recent pandemic spending bill. As it stands, parents this year will get a one-time, fully refundable tax credit of up to $3,000 per child ages 6 to 17 and $3,600 per child under age 6. (This is up from a $2,000 child tax credit approved by the Trump administration, a $1,000 credit approved by the Obama administration, and a $500 credit approved by the Clinton administration.) In addition, Biden wants to provide federally subsidized child care and public pre-schools.

Like Hawley, Democrats aim to engineer certain social ideals through welfare programs and tax codes. "We want parents to be in the workforce, especially mothers," Domestic Policy Council head Susan Rice said earlier this year.

The government could get out of the way and let Americans keep more of the money they earn regardless of whether or not they have children, regardless of their career choices, and regardless of their relationship status. But neither Democrats nor Republicans seem content to be neutral about family arrangements.