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Families pay price for government spending

By Wendy McElroy
web posted October 6, 2003

The modern two-income family is no better off than the one-income family from decades ago. Indeed, family finances are edging ever closer to disaster. So say Elizabeth Warren and Amelia Warren Tyagi in their controversial book, "The Two-Income Trap: Why Middle-Class Mothers and Fathers Are Going Broke."

But they omit a major reason why families are struggling: the increased size of government and governmental spending.

Basically, they argue that the cost of essentials -- housing, education, insurance, medical care -- have increased more quickly than wages, and they offer compelling evidence. The Bureau of Labor Statistics finds that families in 2000 spent 44 percent less on household appliances than families in 1973; 22 percent less on food; 21 percent less on clothing. It is reasonable to conclude or, at least, strongly suspect that discretionary income has decreased. Other evidence supports that conclusion: over 1.6 million bankruptcies were filed last year, up 7.4 percent from the year before.

The book, however, gives short shrift to other impoverishing factors, such as the soaring tax rate and the proliferation of government fees and fines, as well as the staggering load of regulations under which businesses must struggle to remain profitable.

The book, which draws on pre-Sept. 11 data, does not reflect the pricetag of war in Iraq. Rather, it points to the cost of social programs instituted in the name of political correctness, many of which became entrenched during the Clinton administration.

That social engineering includes the child abuse industry and the sexual harassment industry. Critics refer to them as "industries" because their enforcement policies have established bloated and expensive bureaucracies that slurp at the public trough. The cost to taxpaying families is immense.

Consider one small example from just one bureaucracy. In 1997, the Adoption and Safe Families Act promoted a new adoption policy to reduce the number of children stranded in foster care -- at a record high as a result of being "removed" from their parents under expanding definitions of "abuse." In a press release, the U.S. Department of Health & Human Services declared its goal "to double by 2002 the number of children in foster care who are adopted or otherwise permanently placed."

A financial incentive was offered. The ASFA (Sec. 201) states that "$4,000 to $6,000" will be given for each child adopted beyond the state's "base number." It also provides "technical assistance" to help states raise those numbers. Thus the ASFA created its own mini-bureaucracy within the more massive child abuse industry with an incentive to remove children from their families.

Those whose salaries and prestige derive from a bureaucracy have a built-in incentive to continue that bureaucracy. The agency may be incompetent or inflict damage but its tendency will be to continue and grow.

The direct tax support rendered to social engineering is only the most visible pricetag. The hidden costs are as significant.

Consider the hidden costs imposed on the workplace, and so on the family, by the sexual harassment industry. They include: Red tape and lawsuits that make business less profitable -- less likely to hire and more likely to raise prices; marginal businesses that collapse from the strain of fulfilling government requirements; less productive employees who are hired or promoted because of gender thus lowering the general productivity of society.

The iconoclastic feminist Daphne Patai chronicled the hidden cost of the sexual harassment industry to academia in her book Heterophobia: Sexual Harassment and the Future of Feminism. Again, just one small example: The school at which she teaches, the University of Massachusetts at Amherst, paid $1,250 to $1,800 per day per trainer for a course on sexual harassment prevention. The university paid an additional $10,000 for expenses such as travel, hotels and meals. The course was merely one aspect of a broader sexual harassment program at merely one university. Families bore the brunt not only in taxes but also in increased tuition.

There is a palpable upsurge of economic fear among the middle class. Some people blame the debt-ridden family for its own financial woes. A new term has entered the North American dialogue. Affluenza is defined primarily as, "The bloated, sluggish and unfulfilled feeling that results from efforts to keep up with the Joneses."

But most people I know are not competing with their neighbors. They are scrambling to meet a mortgage, provide for their children's education, juggle two jobs, and care for an elderly parent. ... Statistics back up this anecdotal observation.

According to the recent survey "Retail Rituals: Women's Changing Attitudes Toward Shopping," 60 percent of women have radically altered how they shop over the last two years. Researchers at St. Louis University and Louisiana State University canvassed 753 women and found: 30 percent now view shopping as a chore rather than a pleasure; 33 percent demand at least half-off before they will seek out a specific store; and, 18 percent say that their more conservative approach is due to economic fear.

It is wrong to blame families for their own victimization. It is time to eliminate social engineering from the stack of "overdue bills" that families must pay. Even if families could afford the bureaucracies that arose during the drunken spending spree of decades, today's children cannot.

Wendy McElroy is the editor of ifeminists.com and a research fellow for The Independent Institute in Oakland, Calif. She is the author and editor of many books and articles, including the new book, Liberty for Women: Freedom and Feminism in the 21st Century (Ivan R. Dee/Independent Institute, 2002). She lives with her husband in Canada.

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