This section will consider, to some extent, why both men and women are taxed in the first place. Discussion will largely relate to concepts of societal obligation and citizenship. The very concept of citizenship, however, may ‘negat[e] consideration of gender-based inequalities’.[842] When ‘the paid worker in the public sphere is the model, and the appropriate citizenship rights are those associated with paid employment’, women, inevitably, are marginalised.[843] Women often have a greater role in the private sphere (for example, as carers and homemakers) than men, and thus are excluded from models of citizenship which depend upon public roles.[844] Further, these responsibilities in the private sphere can act to preclude women’s entrance into the public sphere, for example, of the marketplace.[845]
Fredman describes this move away from welfare and into paid employment as part of a ‘push/pull’ strategy by Labour: ‘On the “push” side have been the welfare to work programmes centred on the New Deal; while on the “pull side” have been the minimum wage, working families tax credit (now child tax credit and working tax credit) and the national childcare strategy.’[846] Into what, exactly, are mothers being pushed?
Tax credits are designed to increase employment and net income in ‘low-wage areas’ without burdening the government’s budget.[847] A contradiction of such initiatives is that whilst the problem of ‘low wages’ is their target, in some ways, tax credits may act to ensure that areas which suffer low wages continue to do so. As Adler has explained, a key aspect of the new earned income tax credits proposals is that they, by design, in effect force people to accept poorly paid employment.[848] Tax credits ameliorate the effects of low wages, but do not act to raise the wages themselves. Further, employers are given an opportunity by these initiatives to lower wages.[849]
Additionally, studies have suggested that ‘[e]mployment-conditional tax credits and benefits do not only affect the decision whether or not to participate in the labour market; they also affect the volume of labour services which those who are already in employment are prepared to supply’.[850] The reason for this, Ochel suggests, is a reaction against a structure through which, as a worker’s income increases, so the level of credit decreases; and simultaneously, as a worker progresses up the rate brackets, so the rate of income taxation increases.[851] Put simply, although earned income tax credits are designed to ensure that working parents who may be classified as low wage can afford to work (ie, they are no longer effectively prohibited from working because of taxation and the costs of child care), nonetheless, the fact that the more one works, the less one retains, may act as a disincentive to increase volume of work.[852]
It is worth stressing the argument that much of the work concerning the increase in the volume of labour supply emanates from studies of the US’s earned income tax credits.[853] Leigh’s study of the UK revealed similar results, focused on the specifics of the UK system, yet with some surprising caveats. His study considered specifically the increases that both welfare and the tax credits received in 1999, and ‘[w]hile theory suggests that the difference between welfare and inwork benefits will be a key factor determining the employment effect, the stigma associated with welfare may be such that a comparable increase in both welfare and the tax credit will nonetheless induce a rise in labour supply’.[854]
On the other hand, stark analysis of tax credits reveals that the economy may be injured by tax credit programmes.[855] Their attractiveness lies not in the amount of beneficial economic activity that is increased, it is suggested, but in the extent to which they increase the attractiveness of marriage for men (if not for women).
First, poor families will get extra income that should allow them to invest more time and resources in their children. Second, it should make marriage a more attractive option for males, since single males are taxed without receiving any subsidy. On the downside, the attractiveness of marriage for females, however, might decline. Second, the beneficial aspects of this policy for children may be dissipated by larger family size. The long-run health of the economy is not helped by this policy.[856]
This research needs to be considered against a background of high rates of unemployment, which provided the background for the redevelopment of earned income tax credits in 2001 not only in the UK, but in Australia, Canada, Ireland, New Zealand, Finland, France and the United States as well.[857] Initiatives like tax credits are particularly effective techniques in such economic climates because, as explained above, of the opportunity they provide for employers to lower wages.[858] This can reduce the cost of labour, and hence stimulate the demand for more workers.[859]
High levels of unemployment, generally, may have provided a backdrop to the refashioning of the tax credits in 2001, but it was the under-employment of single mothers, specifically, as Blundell and Meghir explain, which truly commanded the government’s attention in the structuring of these initiatives.[860] This was a particular concern, because single mothers remained a persistently ‘under-employed’ group throughout growths in employment for other types of women.[861] The Women’s Budget Group has defined the issue plainly: ‘The government has accepted that we should collectively share with parents the maintenance costs of children by introducing the new child tax credit alongside universal child benefit (formerly family allowance). . .’[862]
On this question of sharing maintenance costs, Alstott has constructed a more radical platform. She suggests that society should contribute money, directly, to parents.[863] She points out that ‘in the not-so-distant past’ raising children made economic sense in terms of their expected contribution to the family business (even during childhood), and support during old age.[864] Now, parents are expected to provide emotional and financial support for almost twenty years, without immediate financial reward.[865] Given this shift, Alstott submits, it is not only unsurprising that parents need help from society, but proper that they should receive it.[866]
Alstott explicitly rejects the ‘libertarian’ response, which would suggest that, even if parenting makes less financial sense than it did not so long ago, nonetheless this is an activity which participants choose.[867] The skills valued under the tax credits legislation would include recognition of the fact that one should choose only to have children which one can afford, without state assistance. The end-game of the Child Tax Credit is a ‘working parent’, working in the marketplace.
In this context, it is worth remembering that fourteen years ago, Fineman suggested that the symbolism evoked by such initiatives may be that the state will move to the side, and then the father will step in to assume his rightful place.[868] This symbolism is particularly redolent when class enters the analysis, and the discussion of the extent of society’s obligation to parents may disintegrate to: ‘I don’t mind paying to help people in need, but I don’t want my tax (dollars) to pay for the sexual pleasure of adolescents who won’t use birth control.’[869] The legislation enacting the Child Tax Credit is not, however, necessarily focused on the father. Its goal is a working parent, whether the mother or the father, to some extent liberated from the otherwise financially prohibitive demands of child care.
The libertarian objection, however, is not dependent on stereotypes of gender and class in the formulation of its argument that society owes no obligation to those who chose an activity of which the benefits, pleasures, struggles and demands are publicised and celebrated in equal measure. The flaw in this argument, Alstott suggests, is child care. She argues that ‘continuity of care’ is crucial to a child’s development, and, if a child grows into a troubled teenager, or student, and eventually troubled adult, then society will suffer in a number of ways.[870]
Given the incentive society has in minimising the products of poor parenting, Alstott argues, it makes sense to make the job of parenting easier through financial assistance, even if parents probably would try their hardest to care for their children with whatever resources they had.[871] Alstott’s proposal is to keep mothers out of the marketplace.
The lynchpin for Alstott’s analyses are studies in child psychology. She writes that, ‘[s]tudies document the serious and lasting emotional harm suffered by children denied continuity of care for long periods or during formative stages’.[872] Social science also is relied upon to establish the impact suffered by parents by their choice to have children, and, in particular, the effect wrought on women’s position in the marketplace. Alstott writes that ‘[s]ocial science research is often equivocal, but on the cost of parenthood to mothers in particular a truckload of research exists to establish how it limits economic options in every class’.[873] Her characterisation of the demands made of the twenty-first-century parent is stark: ‘No exit.’[874] At the core of Alstott’s philosophy is the argument that one affirmative choice (ie, to become a parent) should not provide the excuse for ‘unlimited regulation’ of the remainder (or, at the least, a very significant portion) of a parent’s life.. . without more.[875] Direct financial assistance to parents is that ‘something more’, and, at the least, it provides the possibility of remedying the enormous limitations that parenthood places on women in particular.[876]
In some ways, the value of Alstott’s suggestions is what Livingston has described as ‘the narrative or consciousness-raising side of feminist scholarship, the ability of an author to make us think about gender in a different way than we did before, even if her proposals are politically unrealistic or inconsistent with some versions of feminist theory’.[877] Alstott’s direct subsidy proposals offer an alternative for those uncomfortable with the proposal of the marketplace, with all of its gendered assumptions, as the locus for women’s liberation. Typical ripostes to feminist suggestions about tax include, as Livingston explains, ‘political unrealism’, ‘flawed technical analysis’ and ‘failure to take adequate notice of the differences among various strains of feminist theory’.[878] Taking what could be posed as Livingston’s challenge to view Alstott’s proposal in terms of consciousness raising, then what do we learn about motherhood, tax and the marketplace from these suggestions?
First, we learn that the perceived impact upon children of care which is not provided by parents is increasing the attention placed upon (primarily) women’s work within the home. We learn also, as Minow describes it, that ‘[t]he dominant discourse of economic necessity and market choice risks squeezing out the equally important language of responsibility, care, equality, fairness, and compassion’.[879] This is a contribution, as well, to a model — the family — which imposes limitations on women. It may be that ‘family is one of the most important contexts for the structuring of women’s lives. . . [and] feminists identify the family as a key site of male power over women’.[880] The family is also the basis for welfare distribution.[881] Kilkey and Bradshaw explain that ‘[l]argely as a result of gendered-power relations, familial welfare in all countries remains overwhelmingly the responsibility of women’.[882]
All of this suggests that society has a stake in parenting, and that we all take some benefit from a child that is well ‘supported’. From a strictly economist’s (ie, not feminist) perspective, it is all actually a rather more complicated series of sacrifices:
Women in the lower strata of the economy are better off with a child tax credit. The rest are slightly worse off. The poorest women have the largest number of children so a tax credit helps them the most. Since women value children more than men (single men don’t value them at all), the overall effect of the tax credit on women’s expected utility is less detrimental than it is for men.[883]
Indeed, studies have explored whether child tax credits may be detrimental to society, in that they either encourage families to have greater numbers of children, or at least make it more possible for them to do so.[884] The (albeit limited) value of such research to a feminist analysis might focus on the inevitably broad question of whether or not ‘women’ actually ‘want’ tax credits. There is some empirical evidence indicating that they do.
A study by Alvarez and McCaffery revealed that, in the US, women were more likely to prefer initiatives such as earned income tax credits to, for example, reducing the national debt (which was favoured by men).[885] When informed that tax laws were biased against families with two workers, the study found that men adjusted their preferences to support initiatives such as earned income tax credits, although men objected to tax relief for child care.[886] Women were more predisposed towards child-care tax relief, but less inclined towards tax relief for the ‘working poor’ than men.[887]