Here’s hoping a government commission never determines that I am bad for the economy! This is in Australia, but the thinking behind it is scary nonetheless. Apparently, a government sponsored group called the “Productivity Commission” has warned that increases in the fertility could harm the economy. According to the report:

This is because it will shift women out of the workforce while they care for babies, depressing labour supply and reducing the taxation base as our population ages, the Daily Telegraph reported.

The small number of extra babies born would make little difference to the rate of population ageing, the commission said.

And the women having the babies would be exacerbating the financial impacts on the government of the ageing of the population because the tax breaks offered to parents to have children occur up front, while the cost savings of a bigger working population and bigger tax base from extra children are deferred until they are of working age.

I think the assumptions behind this statement are interesting. (1) Isn’t the Commission conflating the impact on government income and spending with the economy at large? (2) Do they count in any way the additional expenditures parents make on behalf of their kids?

I am no expert, but I think Target’s revenue has had a substantial increase since the wife and I starting having kids. Dusting off my macroeconomics textbook, I know that consumption (C) is an important part of economy. I know that my family’s consumption has gone through the roof with my babies. My wife stayed home. We are not making any more money than we were, but I know we are spending more!

This study strikes me as patently stupid. Read it so you know what stupidity looks like. That is important to do sometimes. We forget.

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