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Also Re: Subsidizing Parents



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Andrew, I think it is highly, highly unlikely that the additional public costs generated by marginal increases in the number of children are going to be anything close to as large as the implicit tax that the federal government levies on child-rearing when a proper accounting is made. And you don’t really argue otherwise.

So I’ll turn to your other point. You write, “What [the deficit commission] does recommend, however, is a reduction in social security payments for the better off (at the same time as these unfortunate fortunate are being asked to pay in more to the system). As disincentives to save go, that takes some beating.” Really? Under none of the progressive indexing plans I have seen will your future benefits fall because you have saved a higher proportion of your income. To the extent progressive indexing changes your incentives to save it increases them, because you won’t be able to rely on getting quite as much money from the government.



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