The United States is one of three countries in the world without some form of guaranteed paid leave for mothers. In the past two weeks, Sens. Jodi Ernst, R-Iowa, and Mike Lee, R-Utah, have embarked on a media tour for their Cradle Act — a bill that proposes to use Social Security funds to provide “paid family leave” for American families. In short, their proposal would allow mothers and fathers to use the Social Security system to fund up to three months of paid leave benefits. In return, parents would work twice the length of their leave (for example, if you take two months of leave, you must delay your retirement by four months).
On the one hand, it’s heartening to see Republicans join Democrats in recognizing the benefits of paid family leave. Mothers are healthier when they take paid family leave, fathers are more involved in the lives of their children, and both parents report increased satisfaction with parenting, decreased stress and better mental health. Children are also benefitted by paid leave. Mothers are more likely to breastfeed, children are more likely to meet developmental milestones, be immunized, and do better cognitively. Most studies find that these effects are long-term, lasting well into a child’s school years and beyond. Families, on the whole, are healthier, happier and get along when parents take paid leave, as well.
On the other hand, however, the Cradle Act falls short. Importantly, it is not paid family leave. Instead, it’s a loan with a 100 percent interest rate. In virtually every other country with paid leave, both individuals and employers contribute equally to an employment insurance program that can be used for a myriad of reasons. In Quebec, for example, employers and employees each pay less than $2 a week, on average, to fund leave. The result is a well-funded, robust system that provides up to one year of leave, paid at up to 75 percent of annual income, split between partners. Although variable in length and generosity, such systems are common across nations comparable to the United States, including the UK, other European nations, and Australia. We already have this program, although it covers unemployment and disability. Expansion of the employment insurance system is well-tested.
Second, Sens. Lee and Ernst rightly point out that family leave systems often benefit middle and high-income families. However, they incorrectly suggest their proposal doesn’t have the same issue. While I applaud their proposal for creating a gradated payment system, where higher income individuals get a lower percentage of their income, their proposal is problematic for families that are the least likely to have retirement savings. Asking low-income families to mortgage their future for a benefit only worsens this issue and may contribute to economic inequality in the United States.
Third, Lee and Ernst are overly and incorrectly concerned with the impact of family leave on businesses. They worry that costly taxes and asking companies to pitch in on paid leave is too high a price for this country. Yet, the research literature is unanimous and clear on this point: Paid leave improves businesses’ bottom lines through increased retention, worker productivity, worker loyalty and competitiveness. Research from both the U.S. and abroad demonstrates that both small and large businesses benefit from paid leave requirements. Any tax and other costs are offset by various savings for businesses and organizations. Taxpayers also benefit from paid leave, through reduced medical costs, educational savings and other cost savings.1 comment on this story
Overall, the research is clear — paid family leave provides substantial benefits for families, employers and society at-large. While Lee and Ernst should be applauded for noting these benefits, their proposal falls short. Indeed, in a country that touts its family orientation, there is little in our public policy to support families. I urge Ernst, Lee and others to reconsider their proposal to better align with the standards set forth by other countries. Only then will we see similar positive benefits.