Wednesday, September 02, 2009

Assessing the net value of children

I saw the link to a Fortune article by Ben Stein at Wenchypoo's site. She quoted the article:
"People in a free society will choose to have more of something if its return exceeds its cost. On the other hand, people in a free society will choose to have less of a good or service if its value is less than its cost."
Having become increasingly interested over the past few years in those things related to the dismal science of economics, this is not the first time I've seen a statement like that. Having read about falling birth rates in western nations, the concept of applying the phrase to child rearing wasn't new, either. And Ben Stein often manages to get me to think about things in a slightly different light. What? Can I place a value on the kidlets? I was intrigued. So I read.
"What is the value of a child in modern Western industrial society? More specifically, what is the value of a middle-class or upper-middle-class or upper-class child in America? And does this have anything to do with the fact that the birth rate among American women has been falling for decades and that the age of first childbirth among educated women is far higher than among less-well-educated women?

Start with economics. People in a free society will choose to have more of something if its return exceeds its cost. On the other hand, people in a free society will choose to have less of a good or service if its value is less than its cost.

Now, what is a modern child? Obviously, not a good or service, but something more and also something less. Long ago, as we all know, humans had children because they liked having sex and because children had some value as assistant hunters and gatherers and keepers of the hearth."

Goes on into the evolution of society, the move past needing many additional hands for hunting or farming, and the modern day wonders of contraception. Then, Stein gets into what makes modern middle-upper class children so costly:
"...raising modern children is such a major pain in the neck. For one thing, thanks to a variety of factors, often parents have to struggle like galley slaves to get their offspring into private schools and pay for them.

The private school parent also has to pony up for every kind of lesson -- ballet, horse, and music lessons, math tutoring, and chess club. The parent also has to drive the little ones to all of these events as well as to the "play dates" that lurk like unanesthetized colonoscopies in modern life. Then there is the most horrible event a healthy upper-middle-class American can have: social engagements with the parents of Junior's classmates.

In other words, we are talking about child rearing as part unpaid chauffeur, part torture."

One thing I'd like to clarify - it's not just private school parents. Parents utilizing the charter and magnet public schools pay for the private lessons, buy uniforms, buy/sell fundraising merchandise, join countless groups which ask for donations from members often, meet volunteer requirements at the school, drive to all the events... and are expected to all of this cheerfully, because we're not paying private school tuition.

"...part unpaid chauffeur, part torture." I love that line. Then there's college. After four (or more) years of paying lots of money to institutions of higher learning, what do you end up with?
"a son with a law degree who cannot get a job, a daughter with a film-school degree who works as a masseuse, or a musician who keeps you up all night with his drums."
Ooh. Goody. I have three children, so could potentially end up with all three of those hypotheticals trying to move back home in their 20s. Can't wait.

To be fair, Stein does point out that not all children grow up to be complete ingrates, with the sense of entitlement of a two year old's "MINE!" phase. His son, of course, is the exception. I may not disagree with his conclusions in the article, but I can't say it brings many pleasant thoughts, either:
"The costs and benefits of having children in affluent America are wildly off kilter. Too much cost, too little reward. Often the cost-benefit analysis of children prints out "Get a German shorthaired pointer instead."

Many people are doing that, and the birth rate is collapsing. But if we stop having enough children, because their value is so low relative to their cost, the society grinds down. It's happening right now. The native-born upper middle class barely replace themselves in America, if they do at all. In a way we are committing suicide as a class, possibly in part because of the burdens of child rearing in modern life.

What is the net present value of a child in modern America? Often, it's difficult to find much, and thereby hangs a question mark over our future as a nation, at least as we have known it."


Slamdunk said...

You are right--thought-provoking article. I like how he uses satire to discuss the difficult topic.

As I read, I thought about how the increasing numbers of persons in the US with pursuing no religious faith strengthens a view that children have little benefits--since the thoughts would be strictly in economic or time perspectives.

mappchik said...

I don't think it's just a religious/faith issue. I know several devout couples who are putting off children. They may have one... someday. Today though, they're paying off student loans, building a career, traveling, decorating a home, etc.

I think the kids who had everything growing up, or wish they had, are either a bit self-absorbed, or waiting until they think they can provide all of those same things for their own potential offspring. Sacrifice isn't something with which they're "comfortable". Which I find funny, since they give both money & time to charities and church.

It makes me think of a saying I've heard about you always have one more child than you can afford - because if you wait until you can afford it, you'll never have any.

Slamdunk said...

Good point--the sacrifice part is very difficult for some to handle.

I don't want argue that it is a strictly religious issue either, but more complex.

With the example that you provide, another issue would be changing roles for husbands and wives (certainly not unaffected by religious beliefs). Whereas historically, the mom's career was not started or put on hold until the children were raised. We did not do things that way, but both came from families with stay at home moms.

Does anyone really pay back student loans anyway?

Enjoy your day.