Politics & Policy

Rubio Moves the Ball Forward on Paid Family Leave

Sen. Marco Rubio (Kevin Lamarque/Reuters)
At a minimum, the Florida senator’s new proposal will advance the conversation around this important issue, and that’s a win for millions of Americans.

Last month, Florida senator Marco Rubio became the first Republican Member of Congress to introduce a public option for paid parental leave. While the politics of what happens next are far from clear, Rubio’s proposal is yet another step toward a bipartisan solution to a problem that the majority of Americans want fixed.

The Economic Security for New Parents Act would allow new parents to pull forward Social Security benefits to finance paid parental leave upon the birth or adoption of a child in exchange for having their retirement delayed by three to six months per benefit taken. Many have been highly critical of the proposal, with the far-left National Partnership for Women and Families calling it “wrong for America.” But it’s generated more conservative support than any paid-leave plan thus far, and for good reason.

There’s a lot to like about Rubio’s proposal. It’s the first Republican plan to create a paid-leave program run through the government, instead of providing incentives for employers to provide paid leave themselves. As a result, it would offer a safety net for people who do not have access to adequate paid leave from their employer. It would significantly increase access to paid parental leave relative to the status quo and relative to other Republican proposals, including Senator Deb Fischer’s plan, since passed and signed into law, to provide tax credits to employers that offer paid leave, and Representative Mimi Walter’s bill to provide workers with more flex time.

What’s more, benefit rates in Senator Rubio’s proposal are progressive, meaning that they are higher for the low-wage workers who have the least access to paid leave from their employers and are at the greatest risk of financial hardship when taking unpaid leave. And rather than conflicting with existing state paid-leave plans or private-sector paid-leave plans, it could be used in conjunction with them, helping small businesses who can’t afford to offer paid leave to their employees.

But arguably the proposal’s greatest strength for the Right is that it requires no new taxes or expansion of government, which would be deal-breakers for many conservatives, and understandably so: Revenue as a share of GDP is expected to rise above historic norms in the coming years and the size of government has never been larger. Adding generous new entitlements and requiring higher payroll taxes instead of looking at how existing spending could be re-prioritized is not fiscally responsible.

That said, requiring new parents to take delayed or reduced retirement income in exchange for paid leave, as Rubio’s proposal does, introduces practical and political concerns. The Social Security Trust Fund is expected to be exhausted before the vast majority of beneficiaries “pay” for their benefit by delayed retirement. As a result, the plan would end up being funded almost exclusively by government debt, as the American Action Forum has pointed out.

Because Social Security is in fiscal trouble, the sustainability of financing parental-leave benefits through Social Security is questionable. It may be difficult for people to adequately predict their retirement needs when they are child-bearing age. And the same low-wage workers Rubio’s plan targets are most likely to depend on Social Security benefits in retirement, although the plan may boost their incomes by making them more attached to the labor force, resulting in greater retirement benefits.

Above all, though, giving new parents the option to receive a benefit now that they’ll pay for later in life is challenging politics. On one hand the increase in flexibility may be helpful to many. On the other, something seems inherently unfair about mothers needing to choose between recovering from childbirth or a full retirement. We don’t ask people to trade out food-stamp payments or health-insurance subsidies or unemployment benefits or home-mortgage-interest deductions or Pell Grants for delayed retirement. The government supports these programs because of their broader societal benefits, and it’s unclear why paid leave should be any different when it has been clearly shown to improve infant and maternal health and labor-force attachment, reduce welfare usage, and increase earnings for new mothers in particular.

Fortunately, these concerns could be addressed by tweaking the bill’s funding mechanism. Instead of paying for parental leave through reduced retirement benefits, it could introduce a more progressive benefit formula to Social Security — the primary recommendation of the bipartisan Simpson-Bowles commission on fiscal responsibility — or change the program’s cost-of-living measure, yet another reform with bipartisan support. These would be necessary changes for the continued solvency of the Social Security Trust Fund even in the absence of Rubio’s proposal. That they would free up additional resources to beef up our system of benefits for the 21st century with paid parental leave is an added bonus.

It is true that today’s political environment makes entitlement reform — however necessary — very challenging. Given that context, Rubio’s proposal has significant upsides for Republicans wanting a paid-parental-leave program absent any other new tax or spending changes and should be given serious consideration. At a minimum, it advances the conversation on paid leave and represents increasing bipartisan consensus that there’s a role for the government to play in helping new parents at a critical moment in their lives. That’s an enormous, and welcome, step forward for millions of Americans.

 

Abby M. McCloskey is an economist, is founder of McCloskey Policy LLC, and has advised numerous presidential campaigns. She is a member of the AEI-Brookings Working Group on Paid Leave.

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