The Day of Stay-at-Home Moms is Over

The following article from the Los Angeles Times reminds us too strongly how for several centuries an American ideal existed where a husband’s salary was sufficient to support his entire family, a wife’s full-time job was looking after that family, and children were born in wedlock to the two of them. This ideal reached its crescendo with the termination of the Second World War and lasted until the end of the century. That era is now over. Today both parents have to work to make sufficient money to support the family. As a consequence, the children are frequently born out of wedlock and raised by a single parent. In fact, increasingly, there is no family at all. If you doubt this, you have only to read Andrew J.  Cherlin’s Labor’s Love Lost: The Rise and Fall of the Working Class Family in America. To quote this author, “The problem of the fall of the working-class family from its mid-century peak, then, is not that the male breadwinner family has declined—it would eventually have collapsed under its own weight. The problem is that nothing stable has replaced it.”


By Danielle Paquette

The days of stay-at-home mothers are behind us, says a new report from the Center for American Progress, which analyzed national labor data and found that, across the country, the share of moms who financially support their families continues to grow.

Nearly two-thirds of American moms these days (64.4%) are breadwinners, the researchers found. That’s a hop from 63.3% in 2012, the year of the last analysis, and a leap from 1970, when roughly a quarter could claim the title.

“Long gone are the days when the majority of middle- and upper-income women stayed home to raise families full time,” the authors wrote. “Instead, in most families, either both parents work or the household is headed by a single parent.”

Forty-two percent of mothers in the United States solely or mostly pull the wagon, while 22.4% bring home at least a quarter of household earnings.

Many women still opt out of employment after having children. Sometimes, however, the soaring cost of child care or a lack of paid maternity leave is what knocks them out of the workforce.


Much of the time, mothers work because they must. One middle-class income no longer can support most households, and culture has shifted away from the rigid gender roles of generations past. But public policy hasn’t caught up, argues Sarah Jane Glynn, senior policy advisor at the Center for American Progress, a left-leaning think tank in the nation’s capital.

“The fact that women are bringing home a significant portion of their families’ incomes does not mean that there is gender parity in the workforce, nor does it mean that working parents and caregivers have the supports they so vitally need,” she wrote. “A lack of policies such as universal paid family and medical leave, paid sick days and workplace flexibility still hold women back from reaching their full economic potential.”

Glynn meant that, for example, an employer can withhold a day of pay if a worker misses a shift to take care of a sick baby. Because women shoulder a disproportionate amount of domestic responsibilities, this kind of lost earnings more strongly hits them.

Meanwhile, as the United States is the world’s only advanced economy that does not guarantee any paid parental leave, income interruptions frequently follow the birth of a child. (Roughly 43 million American workers have no paid sick leave or parental leave, according to the White House.)

The economic blow is harsher for mothers of color, whose families are more likely to depend on them for income than white mothers’ families are. Seventy-one percent of black mothers and 41% of Latino mothers were primary or sole breadwinners in 2015, the most recent data available, compared with 37% of white mothers, the Center for American Progress paper shows.


During the campaign, both major parties’ presidential candidates pledged to make life easier for working mothers. President-elect Donald Trump was the first Republican contender to release policy plans on paid maternity leave and cheaper child care. (He has not said whether he will prioritize these efforts during his first months in office.)

Trump has proposed allowing parents to deduct the average cost of child care in their area from their taxes and creating a national maternity leave program, which, his team said, would pay birth mothers an average of $300 in weekly benefits for up to six weeks.

Proponents have called the measures a step in the right direction, considering that no existing national policies provide concentrated support for Americans who juggle both work and children. Detractors, however, say singling mothers out in the law could hurt their workforce progress.

“You’re going to create a scenario where employers have even more incentive to [discriminate against] women of childbearing age,” said Glynn, who supports implementing a leave program for both mothers and fathers. “It also contributes to the idea that it’s a woman’s job to take care of a baby, while dads are just sperm donors. But fathers of young kids are often desperate for more time with them.”

Danielle Paquette writes for the Washington Post

Why Repealing the Affordable Care Act Turns into a Goldmine for the Rich

This article from a recent Los Angeles Times shockingly lays bare what the rich and the very rich can expect to gain monetarily from the repeal of the Affordable Care Act.

images-6.jpg images-4.jpg

By Michael Hiltzik . Contact Reporter

People wondering why Republicans are so hell-bent on repealing Obamacare even though that would cost 20 million Americans their health insurance haven’t been heeding the old investigator’s maxim to “follow the money.”

The path leads to the Affordable Care Act’s tax provisions, and the discovery that repeal would provide the wealthiest taxpayers with an immediate tax cut totaling $346 billion over 10 years. Every cent of that would go to taxpayers earning more than $200,000 a year ($250,000 for couples). As Nicholas Bagley of the University of Michigan observed a few days after the election, the imperative of handing their wealthy patrons a gift of this magnitude may well outweigh their solicitude for the mostly middle- and low-income constituents whose individual insurance plans would be at risk from repeal.

“However ambivalent Republicans may be about health reform,” he wrote, “they are not at all ambivalent about big tax cuts to the wealthy.”

That tax cut would result from repeal of two major ACA tax provisions aimed at the wealthy. But the figure only hints at the implications of Obamacare repeal on Americans’ incomes. According to a study released this week by the Tax Policy Center, a joint venture of the Urban Institute and the Brookings Institution, Obamacare repeal would reduce the average incomes of Americans in the lowest 60% of income earners, mostly because of the loss of tax subsidies for insurance premiums. But it would give the incomes of those in the top 20% — and especially the top 1% — a significant boost. “In general,” the TPC found, “repealing the health reform law would, on average, cut taxes for the rich and raise them for low-income households.”


The ACA levied a raft of new or expanded taxes to finance such major reforms as tax subsidies for premiums, co-pays, and deductibles, Medicaid expansion (through which the federal government sent $79 billion to expansion states from January 2014 through June 2015 alone), and the improvement of Medicare drug benefits.

The Republican model for repeal — even “repeal and delay” — would eliminate many if not all those revenues. What makes them vulnerable is that the GOP plans to start chipping away at Obamacare through the reconciliation process, which is immune from Senate filibuster but can be applied only to legislation with a budgetary impact, such as taxes.

Some of the new taxes have come under bipartisan fire and might well have been reduced or repealed under even a Democratic administration. These include a tax on medical devices, which the device industry has bitterly fought, and a surcharge on high-quality “Cadillac” health plans that will hit many union-sponsored plans.

But others effectively were part of a rollback of George W. Bush-era tax cuts for the wealthy. Among them was a 0.9% increase in the Medicare tax on wage and self-employment income over $200,000 for individuals and $250,000 for couples. The increase would bring in $123 billion over 10 years, according to the Congressional Budget Office. The ACA also imposed a 3.8% surcharge on capital gains and dividends for those in the same bracket; for them, the top rate on investment income was raised from 20% to 23.8%. The CBO estimated that this would bring in $222.8 billion over 10 years.

Both levies would have been eliminated by a reconciliation bill passed by the Republican-controlled Congress earlier this year and vetoed by President Obama. The bill is thought to be a model for repeal in the coming year.

The Tax Policy Center found that “most low-income households would see no change at all in their taxes” after ACA repeal. But 4% of them would face a tax hike averaging nearly $3,900 because of the loss of premium assistance. Among middle-income households — those with income between $52,000 and $89,000 — most would face an average tax increase of $80, but 3% would would suffer an average income hit of $6,200 because of subsidy repeal.

The picture is much different for the top 1%. The TPC says nearly everyone in that category would get a tax cut averaging $33,000, or about 2.1% of their after-tax income. Those in the top 0.1% do even better, pocketing an average tax cut of about $197,000, or 2.6% of after-tax income. The TPC says the top 1% includes households with incomes of $774,300 or more in 2016 dollars, and the top 0.1% starts at $4.76 million.


Graph shows how repeal of the affordable Care Act affects Americans at each income level

Repealing all those revenue sources might gratify the Republicans’ wealthy base, but it would present them with a dilemma. The GOP says its goal is “repeal and delay” — repeal the ACA now, but hold off implementation of the repeal for four years or even more to give policymakers time to fashion a replacement for the law’s reforms. That means continuing to fund the tax subsidies, Medicaid expansion and other costly provisions until the job is complete. Delay would also incur additional costs, because the individual insurance market would be profoundly destabilized by the prospect of years of uncertainty about a replacement system.

Consequently, it’s likely that insurance companies selling policies on the individual insurance exchanges would have to be heavily subsidized to keep them in the marketplace. As we’ve observed in the past, that might mean restoring risk-adjustment mechanisms that the Republicans undermined earlier, declaring them “bailouts.” This is the harvest of spending years taking potshots at the law without paying much attention to how to improve it. “Repeal and delay lights a fuse that’s attached to a bomb” Bagley says. “No one should be surprised if it explodes.”

Reports from inside the GOP congressional caucuses suggest that Republicans are hoping that, if their ham-handed surgery damages the individual insurance market, they can blame the Democrats for having passed an imperfect law in the first place. No one should be fooled. Republicans have a chance to improve the individual insurance market, but none of their plans will do that.

As Alice Rivlin, Loren Adler, and Stuart Butler of the Brookings Institution observed this week, “If replacing the ACA is truly the goal, repealing it first without a replacement in hand is almost certainly a disastrous way to start.”

Barack’s Last Bank Bash


We would like to comment on today’s lead article in the Opinion Section of the Wall Street Journal. Rather than reproduce it here, we’ll ask you to google Barack’s Last Bank Bash – WSJ and read it at length, if you care to. It is effectively another attempt to exonerate big banks from having caused the Great Recession.

In the third paragraph we read: The government’s lawsuit accuses Barclays of defrauding investors who bought its mortgage-backed securities in the years leading up to the financial crisis. The allegation is that the bank didn’t disclose how bad the underlying loans were. But the government acknowledges in its complaint that Barclays was also an investor in most of the securities at issue, and that it was often buying some of the riskiest slices of the deal. Was Barclays defrauding itself?

 Yes, of course, that is exactly what it was doing. Don’t we all remember that hilarious scene in the movie, The Big Short, based on Michael Lewis’s book of the same name, when Christian Bale, the actor, playing Mike Burry, the stock market investor, who has just discovered the fraud being perpetrated by the big banks with subprime mortgages on themselves, is grinning with triumph. Of course, these big banks were quickly passing the bundles of subprime mortgages on to other investors, not to get caught themselves. But, yes, they were defrauding themselves in the process and this is what Mike Burry caught and used to make himself millions in betting against them.

v1.bjsxMDM1NDE5O2o7MTcwMjE7MTIwMDs1NDYwOzM2NDA Mike Burry in exultation, upon discovering the cupidity and stupidity of the big banks in the movie The Big Short

Later on we read: In announcing that deal, then Attorney General Eric Holder called Citi’s conduct “egregious.” Mr. Holder said the bank had contributed mightily to the financial crisis that     devastated our economy” and spoke of shattered lives allegedly caused by the villainous firm. But that was so 2014.

Now we are asked to believe that this mastermind of an international plot to defraud investors was simultaneously taken in by a nearly identical plot cooked up by a rival rogue organization. Amazing. Will Citi now get some of its $7 billion back to reflect its new victim status?

 The point, brought up in both the movie and the book, is how stupid and blind these banks were in their cupidity to realize a profit from these bad mortgages and how easily caught out they were by a quartet of keen young investors—not how villainous.

And, yes, the actions of these banks, whether villainous or merely stupid, was mostly responsible for the Great Recession and for shattering the lives of thousands of would-be home owners sucked into these untenable mortgage deals. May we remind you of another film 99 Homes which documented the devastation these subprime mortgages brought into the lives of the true victims of this deplorable housing scam. Sometimes the cold cruelty of these editorials that pit giant financial institutions against vulnerable flesh and bone, always to side with the former, is too much to bear and needs pointing out.

99-Homes-1.jpgYoung dispossessed couple from film 99 Homes

A Christmas Tale


The Ghost of Marley

This seems as good a way to get back on line as any. Type this link into your browser www.growth.not forced and you will come up with a 1200 word article from today’s (Christmas Day) New York Times. We have been out of the country for the past month and this is our first posting since returning.

The article seems to us so wrong-headed that we need to comment on it. Firstly, it is not clear what windmill the author is tilting at. To attack inequality as we do does not mean we espouse total equality. This is naif. (And what is this about Rolexes, anyway?) It is the degree of inequality that we are concerned with—the difference between the tolerable inequality of the immediate post-World War II years up to 1970 (“Les Trentes Glorieuses,” as the French call them) and the giddying and steadily increasing inequality of today, which can only lead ultimately to bloody revolution or ruthless state oppression (and here I quote Thomas Piketty, whose ultimate solution is a global progressive tax on capital, which he admits will be difficult to achieve but must be reached to avoid Prof. McCloskey’s offshoring to Dublin or the Cayman Islands).

All of Piketty’s proposal falls within the capitalist system. There is no suggestion of going outside it, simply retuning it to make it work better. Suggestions of the negative income tax and the universal basic income have both been made by economists completely within the capitalist camp. And her notion of Mao’s and Stalin’s totalitarian systems as having been experiments in equality is a joke.

Finally, Prof. McCloskey’s insistence on our lifting up “those below him” smacks of an intolerably patronizing attitude. We are all in this together. The wealth this earth provides needs to be equitably shared, not hoarded by the most rapacious among us. The capitalist system, if properly instituted, provides us with the means to do this. Let’s put it to use.

Merry Christmas!