Abortion and reproductive rights are economic issues

BERKELEY: In a recent television appearance, Michigan Governor Gretchen Whitmer highlighted an all-too-often unrecognised reality: reproductive rights are an economic issue – and not only for women. “The most important, profound decision a person will make, especially a woman, or family, is whether and when to bear a child,” she noted. “So, this is about our personal economy. This is about our collective economy. How can women get into the workforce if they cannot make their own decisions about whether or when to bear a child or access health care?”

Whitmer is absolutely right. Too often, the press and voters treat abortion, and reproductive rights more broadly, as well as other “family” issues – like child tax credits, paid family leave policies and affordable childcare – as somehow different from economic issues. But they are not. All of these issues have significant long-term economic consequences for women, for their families, and for the economy.

And yet, since Hillary Clinton declared, nearly 30 years ago, that women’s rights are human rights, progress on women’s rights around the world has been disappointingly slow. As a result, according to the 2024 World Economic Forum’s Gender Parity Report (which I helped create in 2006 with WEF colleagues who update and expand the report annually), it would take another 134 years to achieve global gender parity on economic participation and opportunity, educational attainment, health and survival, and political empowerment.

While more than 60 countries have liberalised their laws on reproductive and abortion rights (which are also key determinants of women’s health), the United States is one of only four countries – and the only high-income, democratic country – that has eliminated or sharply curtailed those rights. The US Supreme Court’s 2022 decision, in Dobbs v. Jackson Women’s Health Organization, to abolish the constitutional right to an abortion was a giant step backward for women, with significant adverse health and economic consequences for them, their children, their families, and the macroeconomy. The Court’s majority mostly ignored an amicus brief documenting many of these consequences.

Reproductive Rights and Economic Freedom

But abortion is also a moral and political issue. No woman makes the very difficult personal decision to end a pregnancy casually or capriciously. But unless a woman’s body – unless her autonomy and very personhood – is considered a possession of the state, the state has no business controlling her decision. And if she is guided by religious advisers or constrained by religious strictures, those concerns are strictly between her and her conscience. The US Constitution erects a solid wall between religion and the state.

For women, abortion is a cornerstone of economic freedom. Reproductive justice is economic justice. In the US, the nationwide legalisation of abortion under Roe v. Wade (the 1973 Supreme Court decision that Dobbs reversed) was essential to a half-century of women’s economic advancement – and the advancement of their children and families. It allowed women to plan and balance their families and careers, choosing when to have children and how many. It enabled women to complete school, which increased their lifetime earnings. It also contributed to a significantly higher labour-force-participation rate for women, which rose from 43% in 1970 to 57% in 2024 (after a sharp but short-lived decline to 54.6% during the COVID-19 pandemic, when women dropped out of the workforce to shoulder care responsibilities for their children and elders). The female labour-force participation rate is a major determinant of economic growth in the US and around the world.

Moreover, abortion and reproductive health helped to narrow large and persistent gender pay gaps that compound over time and undermine women’s long-term wealth creation and retirement security. It reduced teen pregnancies and the incidence of child neglect and abuse. And it mitigated poverty among women and the likelihood that children would grow up poor. Indeed, there are strong links between poverty and abortion – denying access to abortion places the greatest economic burden and significant health risks on low-income, often minority women, increasing both poverty and inequality. The inverse is also true: reducing poverty tends to reduce abortions.

But abortion is not the whole story. Over the last 50 years, reproductive freedom has enabled women to climb the education and opportunity ladder in the US, where their university graduation rate was 67.9% in 2022, compared to 61.3% for men. And when they take similar jobs with similar educational requirements, the pay and advancement opportunities for men and women are similar at the beginning of employment and evolve similarly over time – until parenthood. Then, as a result of the well-documented parental pay gap, mothers’ expected earnings fall for every child while fathers’ earnings remain largely unaffected.

This gap reflects the reality that women are more likely than men to take time out of the labour force or reduce the hours they work for childcare and household responsibilities. Even when women are the primary income earners or earn more than their husbands, they still assume more caregiving responsibilities, while their male spouses spend considerably more time on leisure activities.

Anticipating their childcare responsibilities, some women eschew what the Nobel laureate economist Claudia Goldin calls “greedy jobs.” Think professional financial and legal jobs that require one to commit to a grueling, unpredictable schedule in exchange for high pay and promotion prospects. Men take such jobs more readily, on the assumption that their partners, extended family, or hired help (often immigrants) will manage care responsibilities when they arise.

For mothers, both employment and earnings fall sharply around the time of childbirth. In contrast, men sometimes experience a wage increase after becoming a father. As children grow up, and women are able to work more hours, the parental pay gap narrows but does not close. There are permanent effects on gender differences in earnings and advancement opportunities. According to one recent study, higher-earning women experience a 60% drop in pre-childbirth earnings compared to their male partners.

Anti-Abortion Is Anti-Family

Since the Dobbs verdict came down, Republican opposition in Congress to reproductive rights has been steadfast. House Republicans have proposed a national abortion ban with no exceptions for rape, incest, and the health of the mother, while Senate Republicans have blocked four new bills to protect reproductive rights. And Project 2025, the federal governance blueprint should the Republican nominee, Donald Trump, win the presidential election in November, would prohibit the use of mifepristone, an FDA approved drug currently used in medication abortions (which now account for 63% of all abortions, up from 53% in 2020). It would also revive the nineteenth-century Comstock Act banning the shipment of abortion medication, equipment, and materials through the US mail.

In a recent interview, Trump said that he wants to protect IVF treatments protected and ensure that the government or private insurance pays for them. But his position is at odds with Project 2025, which recognises fetal personhood and therefore is opposed to IVF. Assisted reproductive technology (ART) procedures, including IVF, are used widely across the country; in 2021, 2.3% of all infants born in the US were conceived with the use of ART. The top ten states with the most births using ART that year included Texas, Florida, Pennsylvania, and Georgia. And yet, with Vice President Kamala Harris, the Democratic presidential nominee, making IVF a campaign issue, Senate Republicans blocked a vote on the Right To IVF Act for the second time in four months, calling it unnecessary and politically motivated. Only two Republicans – both women – voted in favor.

The same elected leaders who oppose abortion rights in Congress and in the states that have introduced the most draconian bans (all under Republican leadership), wrap themselves in pro-family rhetoric. But the reality is starkly different. In the states with the strictest abortion restrictions, children are more likely to be poor, and babies are more likely to die in their first month. Additionally, women in these states experience higher maternal mortality rates, and are less likely to complete their education.

A glaring example of congressional Republicans’ anti-family, anti-children agenda was their refusal to extend the expansion of the child tax credit introduced during the pandemic. In 2021, the child poverty rate, as measured by the supplemental poverty measure that incorporates the CTC expansion and other government benefits, declined sharply to 5.2%. When the CTC expansion expired and other pandemic relief programs expired, the poverty rate more than doubled to 12.4%, erasing all the gains made against child poverty in the past two years.

Recently, Senate Republicans blocked a bipartisan bill to expand the CTC, fearing that it would mean a political win for the Democrats in an election year (they also blocked a bipartisan immigration bill for the same reason). By the end of 2023, 15 states had their own children’s tax credits, but only two of the 14 states with the most restrictive measures on abortion – Idaho and Oklahoma – offered them. And state credits are much less generous than the federal CTC.

Like abortion rights, family and parental-leave policies have profound economic consequences for women and their families. The US is the only high-income democracy where female workers and their partners have no right to paid parental leave to bear and care for children. Consistent with their anti-women, anti-family positions, Republican congressional leaders have consistently blocked legislation on paid family leave – even as other rich democratic countries, and many poorer ones, have robust policies in place.

Thirty years ago, President Bill Clinton signed a bipartisan law, supported by 16 Senate Republicans, that requires 12 weeks of unpaid family leave for the care of children and the sick, and includes job protections for workers who exercise the unpaid leave option. The Family and Medical Leave Act applies to companies with 50 employees or more and covers a large share of US workers. About 460 million workers have taken unpaid family leave since FMLA was passed. By 2023, 89% of workers in the private sector had taken advantage of the FMLA’s benefits.

But in the absence of a federal paid leave requirement, only 27% of workers (and only 28% of state and local government workers) have access to paid family leave offered by their employers. And when it is offered, coverage is uneven: 39% of high-income management and professional workers are covered by their employers, compared to 20% of middle-income production workers and just 16% of low-income service workers, many of whom are women holding two or more jobs to keep their children out of poverty.

Whether a US private-sector worker receives paid family leave depends on the company’s policies and labour’s negotiating power. With union membership covering just 6% of the private-sector workforce, only 13% of private employers offer paid paternity leave, which is why more than 70% of American fathers return to full-time work less than two weeks after birth of a child. In contrast, many European countries and some US private employers have recently introduced paid paternal leave to encourage men to shoulder a larger share of childcare responsibilities. These benefits must be used by fathers and cannot be transferred to mothers.

In addition to women and their children and families, the overall US economy would benefit from a federal paid leave requirement. According to the US Department of Labor, if the labour-force-participation rate for women was similar to that in Canada or Germany, which offer paid family leave and more comprehensive family-support policies, the number of employed women in the US would increase by about five million and generate over $775 billion in economic activity.

In the absence of a federal requirement for paid family leave, 13 states and the District of Columbia – including the home states of the Democratic presidential nominee, Kamala Harris (California), and her running mate, Minnesota Governor Tim Walz – have enacted their own mandatory paid family leave policies. Revealingly, none of the 14 states with the most restrictive abortion laws has done so, although five offer optional paid leave coverage through private insurance.

Children Last

Another cornerstone of women’s economic opportunity is access to affordable high-quality childcare. More than two-thirds of children in the US live in households where all available parents are in the workforce. The top reason women leave or change jobs is inaccessible and unaffordable childcare, and nearly half of mothers who leave the workforce due to lack of childcare remain unemployed. Caring for children, the elderly, and the sick is real work, yet these are jobs that are not valued in the market.

The lack of affordable childcare and eldercare is a major problem in rich and poor countries alike. US Treasury Secretary Janet Yellen describes the current situation as a textbook example of a broken market, a collective-action problem that cannot be solved by profit-driven markets alone. Whether and how this problem is addressed in the US will depend on the outcome of the 2024 election. Harris has identified affordable childcare as a federal policy priority in her pro-family agenda.

During the pandemic, the federal government provided $52 billion in emergency temporary funding to states to prop up the childcare industry, but that funding ended in 2023, leaving states to fill the gap. Currently, the federal government continues to provide funding to the states for childcare through the Child Care and Development Block Grant (CCDBG) system. It also funds the highly successful Head Start and Early Head Start Programs, which are available to eligible families at no cost but cover only a small share of families. At the federal level, the military also provides childcare-fee assistance for eligible families.

Meanwhile, using CCDBG grants and their own funds, several states (including California and Minnesota) are taking innovative measures to address the childcare crisis. At latest count, even states with the most restrictive abortion laws – including North Dakota, Kentucky, Alabama, Missouri, Idaho, Kentucky, and Indiana – are adopting policies for affordable childcare, and Texas is evaluating lessons from these “red states.” At least on this family issue, some abortion-denying states are experimenting with a variety of federal government-supported measures to address the US childcare crisis.

Women and the US Election

The evidence is compelling: reproductive rights are the foundation of economic rights for women. And the consequences of those rights, together with child tax credits, paid family leave policies, and affordable childcare, extend beyond women, to their families and the overall economy.

Harris has identified these issues as top priorities for her administration if she is elected in November. She has also proposed an additional $6,000 tax credit to help families cover the costs of newborn children during their first year. Enthusiasm for her is surging among women voters, especially young women of child-bearing age (those most affected by abortion restrictions), and women appalled by the contempt for women evident in Trump’s past behavior and his derisive comments about Harris’s intelligence. Trump’s running mate, Senator J.D. Vance, has not helped with his comments about childless cat ladies.

Women voters now favor Harris over Trump by a whopping 18 percentage points, with the gender gap having widened by six percentage points since President Joe Biden beat Trump in 2020, and US women have voted at a higher rate than men in presidential elections since 1980. The writing is on the wall: women and the issues that matter to them and to the economy – and that should matter to more men – are very likely to determine the outcome of the election.

Laura Tyson, a former chair of the President’s Council of Economic Advisers during the Clinton administration, is a professor at the Haas School of Business at the University of California, Berkeley, and a member of the Board of Advisers at Angeleno Group.

Copyright: Project Syndicate, 2024.

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