This essay is part of our collection on common good economics. Read related pieces here.
Dear Senator Warren,
Congratulations! You’ve been making great progress in your presidential race. As a working mom of two little girls, aged two and three, I’m happy to see a fellow mom in the spotlight, fighting to help middle-class families. But, I have to admit, I’m a little bit confused.
Let me explain.
I recently read the book you published with your daughter in 2003, The Two-Income Trap. Well, technically, I listened to the audiobook while washing dishes, folding laundry, and driving back and forth between home, work, and my kids’ preschool. Anyway, as I listened, I found myself nodding along in agreement.
I was fascinated by your well-researched narrative of how the middle class got into the trouble we’re in now. I was particularly intrigued by your description of stay-at-home moms as families’ “built-in social safety nets.” As you explain, these moms often cushion the blow of financial crises, because they are able to reenter the workforce if their husband is laid off or injured. They’re also able to care for a sick, injured, or aging loved one without the family having to lose income or pay for a professional caregiver.
As you explain, instead of easing families’ financial burdens, the large-scale entrance of moms into the workplace kicked off bidding wars that led to skyrocketing costs for families’ basic needs, such as housing and childcare. Because families have higher fixed costs, which eat up both parents’ paychecks, they’re more vulnerable to any disruption in their income. Neither can afford to cut back, even if they want to. In other words, they’re caught in “the two-income trap.”
I’m no economist, so I won’t weigh in on your analysis of interest rate regulation or bankruptcy law. However, I am intimately familiar with the realities of balancing a family budget. I cut back to part-time work after I had my first daughter, who was born while my husband was still earning a modest grad student’s stipend. My second was born sixteen months later, right as he finished his degree. We’ve never had trouble paying our bills, for which I am very thankful. Still, we do both have outstanding student loan debt, which we’re working to pay off as soon as possible. Unfortunately, like the couples in your book, a large portion of our take-home pay is dedicated to basics like housing and childcare. Although we live in an area with a very high cost of living, we still spend significantly more on childcare each month than we do on rent—and our kids are only in preschool three days a week.
My husband and I are privileged in many ways. We both have great educations, good jobs, flexible schedules, and supportive employers. If we’ve struggled with high childcare costs, student loan debt, and skyrocketing housing prices, how much worse must these struggles be for families who don’t have so many advantages?
In your book, you discuss one option that is often proposed to help young families: government-subsidized universal day care. You note that this “would certainly be a big help for poorer families whose paychecks can barely cover even low-quality child care.” Still, you caution that, for “the average two-parent middle-class family,” “the long-term financial implications are more complex.” That’s because these programs don’t apply equally to every child. Instead, they benefit “only some kids—those whose parents both work outside the home.” You write:
Day-care subsidies offer no help for families with a stay-at-home mother. In fact, such subsidies would make financial life more difficult for these families, because they would create yet another comparative disadvantage for single-income families trying to compete in the marketplace. Every dollar spent to subsidize the price of day care frees up a dollar for the two-income family to spend in the bidding wars for housing, tuition, and everything else that families are competing for—widening the gap between single- and dual-income families. Any subsidy that benefits working parents without providing a similar benefit to single-income families pushes the stay-at-home mother and her family further down the economic ladder. In effect, subsidized day care would add one more indirect pressure on mothers to join the workplace.
This is a key insight. As you explain very clearly, government-funded universal daycare won’t help middle-class American families in the long run. Instead, it will ensnare more and more families in the “two-income trap” that you spend an entire book warning so eloquently against.
You suggest that, if our country does eventually institute universal childcare, “day-care subsidies could be accompanied by offsetting support for single-income families, such as tax credits for stay-at-home parents, which would help level the playing field between single- and dual-income families.” This seems like a promising concept. Public policy shouldn’t promote only one configuration of work and family life, pushing for all children to be enrolled in daycare from a young age while both parents work full-time outside the home. Instead, we should let parents choose what is best for their children, empowering them to come up with the right solution for their families, whatever that may be. We should be careful not to let good intentions create perverse economic incentives that penalize single-income families.
Now, this is where I get confused.
After reading this book, I visited your website. I was curious to see how you would translate the insights from your book into concrete plans for public policy. As a former Harvard Law professor, you seem well-suited for the task. So, now that you are a candidate for president of the United States, what do you propose to help middle-class families who are caught in the two-income trap?
Given your criticism of government-subsidized daycare in 2003, you can imagine my surprise to find “UNIVERSAL CHILD CARE”—in all caps—listed among the causes you champion. According to your site, “Elizabeth is fighting to make high-quality child care from birth to school age free for millions of families and affordable for everyone.” You propose using federal funding to provide childcare “free to any family that makes less than 200 percent of the federal poverty line. That means free coverage for millions of children.”
I’m not opposed to using more federal funding to help families. But what happened to the part about stay-at-home moms? Have you forgotten them? You yourself clearly explained in your book that universal daycare “pushes the stay-at-home mother and her family further down the economic ladder” and adds “one more indirect pressure on mothers to join the workplace.”
Senator Warren, please remember: I’m a working mom. I am all for mothers continuing to work if they choose to. But—as you observed in 2003—I think there is something very, very wrong when the government starts creating incentives that push moms out of the home and into the workforce when they don’t want to be there.
As you taught me, stay-at-home moms are real contributors to their families’ financial well-being. They cushion the blow of financial disasters and keep their families out of the bankruptcy courts. If you’re trying to help middle-class American families, why would you create a program that encourages them to lose their “built-in social safety nets”? Given that a majority of Americans think it’s ideal for kids to have a parent at home full-time, and that many working moms wish they could stay home, why in the world would you create a system that makes it even harder for them to do so?
With all due respect, Senator Warren, I think you’ve lost your way.
I’d like to remind you of a story that you tell in your book about meeting then–First Lady Hillary Clinton in 1998. You were brought in to teach her about how women are affected by bankruptcy laws. You convincingly explained why a bill that was currently pending would hurt single mothers and families in financial crisis. Even though her husband’s administration supported it, the First Lady left your meeting with a mission “to stop that awful bill.” Thanks to you, Mrs. Clinton convinced her husband to veto the bill.
I’ll let you explain what happened next.
In the spring of 2001, the bankruptcy bill was reintroduced in the Senate, essentially unchanged from the version President Clinton had vetoed the previous year.
This time freshman Senator Hillary Clinton voted in favor of the bill.
Had the bill been transformed to get rid of all those awful provisions that had so concerned First Lady Hillary Clinton? No. The bill was essentially the same, but Hillary Rodham Clinton was not. As First Lady, Mrs. Clinton had been persuaded that the bill was bad for families, and she was willing to fight for her beliefs. Her husband was a lame duck at the time he vetoed the bill; he could afford to forgo future campaign contributions. As New York’s newest senator, however, it seems that Hillary Clinton could not afford such a principled position. Campaigns cost money, and that money wasn’t coming from families in financial trouble.
Senator Warren, please don’t do what you criticized Senator Clinton for doing. Don’t compromise what you know to be true for the sake of political expediency and self-interest. Don’t hurt American families by pushing them farther and farther into the two-income trap. Most of all, please don’t create a system that penalizes moms who choose to stay home with their children.
Senator, you’ve done your research. You know what kind of policies will give families the support they need to raise their children as they choose, and which will force both parents to keep running the rat race, whether they like it or not. You’ve positioned yourself as the champion of middle-class American families, someone who will stand up to Washington insiders on our behalf. Now it’s time to live out those promises. Don’t let the allure of power convince you to do something you know isn’t right.
You’re in the spotlight, Senator Warren. Don’t fail us now.