Rearing Children

A few years ago England’s Princess Diana was photographed wearing a pink and white sweater bearing the slogan: “I’m a luxury few can afford.” Given Her Royal Highness’s jet-setting lifestyle, it was an appropriate fashion statement. Today, that slogan can be applied not just to well-heeled British princesses, but to middle- class American children. Thanks to the rising tide of federal taxes, families are becoming a luxury few can afford. Stephen Moore, a tax analyst at the CATO Institute, says most families have no idea how much they really pay in taxes. For example, the National Taxpayer’s Union found that in 1991 a family of four making $52,895 paid almost $27,680 in taxes, including federal, state, local and other indirect taxes. That’s 50.4 percent of their earnings. In other words, Moore says, “the government [took] home a larger share than the worker.” It didn’t used to be this way. The first federal income tax in 1913 demanded what sounds like pocket change today—about $50 per family in 1990 dollars. The same family today pays more than $5,000. Robert Rector of the Heritage Foundation says that after taxes, families with children are now the lowest income group in America. Some families sacrifice the mother’s paycheck so she can stay home with the kids. But they discover on tax day that the federal child-care credit gives a tax break only to parents who pay for childcare. There’s no break for parents who raise their own children—even though they may pay just as much indirectly through the loss of a second income. Families who care for their own children are in effect subsidizing wealthier, dual-career families who place their children in hired care. But when families send mom back into the workplace, they’re in for another shock. In the 1950s a typical middle-income family man paid only about four percent of his income in federal taxes. Today, a dual-career couple sacrifices about 24 percent of their combined income to federal taxes alone. That ought to make us angry, because these taxes aren’t just making it harder for parents to provide for their kids: They’re undermining the family itself. Parents spend 40 percent less time with their kids than they did in 1965. Why? Because, Moore says, “parents have to be out working more, in large part because taxes on families with children are so much higher.” And that’s a problem that affects all of society. Decreased parental supervision is linked to problems in language skills, school performance, and internalization of moral values. On Tax Day we need to remember that tax codes express a society’s values. The government raises taxes on behavior it wants to discourage, and lowers taxes on behavior it wants to encourage. What values does our current tax policy express? It penalizes couples for having children, and it penalizes them again if they leave the work force to raise their children. Our government is acting as though its goal is to destroy the family itself. You and I ought to ask our lawmakers to support changes in our tax codes—changes that take the tax burden off the backs of America’s middle-class families. Because bearing and rearing children shouldn’t be a luxury that only the rich can afford.

04/15/96