Marco Rubio & his terrible, horrible, no good, very bad paid leave policy
Last week, in an eyebrow-raising move, Senator Marco Rubio detailed a plan for providing paid leave to workers. It’s a prudent political decision, seeing as 80 percent of Americans are in favor of requiring companies to provide paid family leave and also because the US is the only OECD country that doesn’t mandate such a policy.
Before you start thinking he’s a socialist in Milton Friedman’s clothes, note the key caveat in Rubio’s policy proposal: Whereas Democrats like Sanders and Clinton would institute paid leave via federal legislation, Rubio would merely give tax incentives to businesses that offered paid leave, thereby passing the responsibility of basic worker protections on to businesses themselves. Because if we’ve seen anything in the short history of capitalism, it is that businesses always have the best interests of their employees at heart.
Rubio’s plan would offer a 25% tax credit to employers who offer a minimum of 4 weeks of paid family leave. The maximum pay out per employee, to full-time and part-time workers, would be $4,000, and the maximum leave time would be 12 weeks. “For instance,” Rubio explained, “if you are offered $1,600 in paid leave for four weeks while you take care of your newborn, which would be the equivalent of about $10 an hour, your employer could claim a tax credit for $400.”
Rubio’s plan acts as a voluntary, market-based approach to solving a huge problem in America: less than 15% of US citizens have access to any kind of paid family leave. This is certainly not the first time Rubio has put the market in charge of improving complicated issues. In the past, he’s argued that we should leave it to the free-market to fix the environment and yes, he thinks we should repeal Obamacare and replace it with a market-based health care program instead. What’s more, he finds it troubling that most people believe “we need big government to protect the little guy.” Instead of being a guardian of the little guy, he thinks “big government — more often than not — is an impediment to the guy who is striving.” In essence, Marco Rubio has a cult-like devotion to the Republican god of all solutions, The Market.
Give me a break. The Market has had its chance to help workers who wanted paid sick leave. And guess what? It hasn’t come in and saved the day. Just like it didn’t eliminate child labor or establish a minimum wage. For such rights to be implemented, the better angels of our nature had to be channelled through the government. The Market couldn’t (or wouldn’t) do so. This isn’t a knock against the power or beauty of laissez-faire. It’s merely pointing out that The Market cannot solve every single problem which faces mankind.
Republicans often like to invoke Reagan’s famous quip that the “nine most terrifying words in the English language” are “I’m from the government and I’m here to help.” Similarly, if capitalism has taught us anything, the nine scariest words for workers should be: “I’m the market and I will look after you.”
The optimist in me wants to believe that although Rubio’s policy plan is lame, it is a good indication that Democrats are winning the economic argument in this election cycle. Here we have a Republican candidate meeting Democrats halfway on a key economic policy proposal that will benefit hard-working Americans. Sure, we don’t agree with how Rubio would go about solving the problem, but at least, unlike climate change, he is willing to admit we need a solution. That is cause for celebration, no matter how muted.
However, the problem with Rubio’s approach is that tax incentives are 1) more or less putting a price on a right and 2) not very effective. As the Upshot points out:
The government offers tax credits to encourage companies to do other things, like hiring veterans or people with disabilities and offering on-site child care. But there is little evidence that these credits significantly change employers’ behavior. Employer-sponsored child care is still extremely rare, for instance, and a subsidy for firms that hire various disadvantaged workers has been found to have little effect on their employment.
Even if you were to present Rubio and his fellow market followers with these facts, they would still be unwilling to admit that the government has a role to play in ensuring the rights of working Americans. That is disappointing for our political discourse. I suppose such a mindset is to be expected when one’s political ideology transforms from a set of ideals to market worship.