A Baby Boom? In This Economy?

Mint

27-04-2025

(Bloomberg Opinion) -- The US birth rate is near a record low, the Centers for Disease Control and Prevention reported on Wednesday, with only 1.6 children born per woman, below the 2.1 needed to sustain the population. This is no surprise — the birth rate has been falling since 2007.
What is surprising is the inconsistent — and contradictory — set of policies the Trump administration is employing to try to address it.
Among the proposals the administration is reportedly considering are a 'baby bonus' in the form of a $5,000 tax credit to every American mother after the birth of a child, a plan to 'educate' women on their menstrual cycles so they're better prepared to conceive, and reserving a share of Fulbright Scholarships for married parents.
The pronatalist push started at the Department of Transportation where Secretary Sean Duffy, the father of nine kids, issued a memo in February dictating that 'communities with marriage and birth rates higher than the national average' be given preference in transportation funding.
I don't doubt these policy makers are sincere. President Donald Trump has proclaimed that he wants to be 'the fertilization president.' Elon Musk, the father of an estimated 14 children and head of Trump's quasi-government Department of Government Efficiency, has said 'civilization is going to crumble' unless we raise the birth rate. And Project 2025, the Heritage Foundation agenda Trump is following, wants the president to use government policies, including the tax code, to 'restore the family as the centerpiece of American life.'
But they are trying to usher in a Trump baby boom at the same time Musk and DOGE are slashing federal programs that help women have more kids.
The list of cuts is long: DOGE has slashed funding to the Maternal and Child Health Bureau in the Department of Health and Human Services, the NIH's National Institute of Child Health and Human Development, and the Center for Disease Control's Division of Reproductive Health.
Even after Trump issued an executive order promising to make in vitro fertilization more readily available and affordable, DOGE gutted the CDC's Assisted Reproductive Technology team, which monitors the effectiveness of IVF programs across the country. DOGE has also laid off federal workers running programs for expectant mothers on Medicaid, canceled funding for maternal and postpartum care, and eliminated more than $12 billion from state health departments, including $2 billion earmarked for child vaccination programs. These shortsighted cuts will hardly help reverse declining birth rates.
One of the people the Trump administration has consulted on this effort is demographer Lyman Stone, director of the Pronatalism Initiative at the conservative Institute for Family Studies. His own research suggests that the White House is being far too cheap in its plan to offer families a $5,000 'baby bonus.'
'More money does yield more babies,' Stone wrote in 2020. 'Anybody saying otherwise is mischaracterizing the research. But it takes a lot of money.'
Stone argues that low fertility rates in the US and other high-income countries are due to low marriage rates and a decline in young men's income. He's been a proponent of subsidies that encourage marriage and he backs the American Family Act, a Democratic plan to expand the child tax credit and give parents with more kids higher tax credits.
Government-provided incentives for kids would cost the US billions, but this approach has been tried with some success in many other countries, he notes. A 'baby bonus' in Australia boosted fertility, but cost more than $100,000 per child. A British study found that 50% higher per-child spending on welfare in the UK yielded 15% higher births. Russia's policy of giving 'maternity capital' of $11,000 to mothers of second or third children since 2007 has boosted second childbearing by 2.2%. But Singapore's plan to pay baby bonuses to couples with three or more children has had only limited success.
Stone concluded in 2020 that to reach the replacement rate needed to sustain the US population without immigration, the fertility rate would have to rise to 2.07 children per woman.
'To accomplish this, we would need the present value of child benefits to increase by somewhere between 52% and 400% of household income,'' he wrote. 'For the median woman, this would mean providing a child benefit for the first 18 years of a child's life worth approximately $5,300 per year in addition to currently-provided benefits, with the range running from $2,800 more per year to $23,000 more per year.'
That kind of money is probably impossible to come by, Stone admitted, so he suggests that government pursue additional policies, such as removing obstacles to marriage by reducing the marriage tax penalty for two-income families and expanding the child tax credit into something he calls a 'parenting wage.'
Other scholars say the scope of solutions should include expanded paid parental leave and subsidized child care, as well as more affordable housing to lower the cost of family formation.
Of course, the choice to create a new life isn't only a financial calculation. It's also a profound act of hope. And Americans are not feeling especially hopeful right now. Polls show that more than half of the country is worried about a constitutional crisis. Wall Street is nervous; consumer confidence is at the second-lowest point on record; and most Americans aren't confident in Trump's handling of the economy. Only 15% of the youngest Americans think the country is on the right track.
You'd think the Trump administration would want to focus on increasing — not cutting — funding to maternal and child health, repairing its self-inflicted economic wounds, and lowering the cost of living for working families before asking young people to forget all their troubles and bring children into the world. This lack of situational awareness is not just ironic, it's irresponsible.
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This column reflects the personal views of the author and does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Mary Ellen Klas is a politics and policy columnist for Bloomberg Opinion. A former capital bureau chief for the Miami Herald, she has covered politics and government for more than three decades.
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First Published: 27 Apr 2025, 06:30 PM IST