Donald Trump’s proposed fiscal year 2020 budget (Oct. 1, 2019–Sept. 30, 2020), “A Budget for a Better America: Promises Kept. Taxpayers First,” largely mirrors his two previous budgets for fiscal years 2018 and 2019. In spite of Democratic criticism of Trump’s “cruel,” “shortsighted,” “toxic,” “destructive” budget, it is just like the budgets of his Democratic predecessor: bloated, irresponsible, and full of unconstitutional spending that maintains the welfare/warfare state.
One of Trump’s proposals found in all three budgets is his government-paid family-leave program. In the section on the Department of Labor in the overview of the 2020 budget, under the heading “Supports Working Families,” it states,
Provides for Paid Family Leave for New Parents. The Budget invests in a better future for Americans with a proposal to provide paid family leave to new mothers and fathers, including adoptive parents, so all families can afford to take time to recover from childbirth and bond with a new child. The proposal would allow States to establish paid parental leave programs in a way that is most appropriate for their workforce and economy. The Administration looks forward to working with the Congress to advance policies that would make paid parental leave a reality for families across the Nation.
That paragraph could just have easily appeared in one of Barack Obama’s budgets.
Providing Access to Paid Family Leave for All New Parents. The Budget includes a proposal to provide at least six weeks of paid family leave to new mothers and fathers, including adoptive parents, so all families can afford to take time to recover from childbirth and bond with a new child.
Again, Obama could have had that in one of his budgets.
In previous “fact sheets,” the Trump administration linked its family-leave proposal to the current Unemployment Insurance (UI) system. This time one must dig into one of the budget’s “summary tables” (Table S–6. Mandatory and Receipt Proposals) under the Department of Labor to see the connection.
The figures in Trump’s budget state that his proposal would cost about $20 billion over the next ten years, with more than $3 billion in annual costs by 2029. Earlier research from the American Action Forum calculated the actual cost of Trump’s paid leave plan to be four times as much.
Some conservatives are opposed to Trump’s scheme to link a paid family-leave program to the existing UI system.
Matt Weidinger, a resident fellow in poverty studies at the American Enterprise Institute (AEI), argues that doing so “makes little sense” because “it would lead to significant hikes on job taxes, interfere with the core mission to help the unemployed, and increase all the billions of dollars misspent by the unemployment insurance system.”
Weidinger is the author of a recent report, “Why Paid Leave Does Not Belong in the Unemployment Insurance System,” that “examines the scale of the UI program’s potential expansion under the administration’s FY2020 budget proposal and other prominent paid leave proposals if similarly operated through the UI system.” He maintains that “adding a paid leave program to UI, even a relatively ‘small’ program like the administration has proposed, threatens to significantly increase program costs and state payroll taxes in the long run.” He also believes that it is “reasonable to expect that the president’s proposed paid leave program would grow significantly over time” because “the mandatory minimum of six weeks of paid parental leave proposed by the administration is on the low end of current state paid leave programs, in terms of both weeks of paid benefits and the extent of coverage.” Weidinger concludes that “the FY2020 administration budget proposal to add a paid leave program to the UI system is ill-considered, especially if the administration is interested in holding down payroll taxes on jobs in the future.”
None of that means that Weidinger is opposed to a government-funded unemployment-compensation program or a government-funded family-leave program. Like other conservatives who oppose linking a paid family-leave program to the existing UI system, he isn’t. He just opposes this particular plan. Thus, his article and his report inadvertently show that conservatives have no fundamental objection to people’s being paid by the government for not working. They may differ from liberals, progressives, and socialists when it comes to the benefit amount, the benefit duration, the benefit eligibility requirements, and how the benefit is funded, but conservatives rarely voice philosophical objections to the government’s taking money from those who work and transferring it to those who don’t.
Both unemployment benefits and family-leave benefits pay people for not working.
The federal government imposed an unemployment program on the states by means of the Social Security Act of 1935 and the Federal Unemployment Tax Act of 1939 (FUTA). The Department of Labor oversees the program and sets broad guidelines for coverage and eligibility, but the program is administered and mostly funded by the states, which vary considerably not only in the amount of taxes they collect to help fund the system, but also in how they determine eligibility and benefits. As long as various eligibility requirements are met, unemployment benefits can generally be collected for as long as 26 weeks.
Unlike payroll taxes, which are borne equally by employer and employee, unemployment taxes are paid solely by employers (except in the few states that tax employees as well). A federal unemployment tax of 6 percent is imposed on employers on the first $7,000 of taxable wages paid to each employee during a calendar year. Each state likewise assesses employers an unemployment tax, less a credit against their federal tax liability as high as 5.4 percent for payment of state unemployment taxes. State unemployment taxes and wage bases are generally higher than the federal rate and base. In fiscal year 2018, $36.4 billion in state and $6.8 billion in federal unemployment taxes were collected.
The Family and Medical Leave Act (FMLA) requires that companies with fifty or more employees allow them to take twelve weeks of unpaid family leave. However, a number of states have paid leave programs, and many more have pending legislation for paid leave programs. If it were up to Democrats in Congress, the federal government would have a national paid family-leave program more generous than that proposed in Trump’s budgets.
It is never right for government at any level to take money from those who work and transfer it to those who don’t. In fact, it is never right for government at any level to take money from anyone — even if he can “afford” it — and transfer it to anyone else — no matter how badly he “needs” it. Conservatives — who claim to believe in the Constitution and limited government — should expend their energies opposing both a government-funded unemployment-compensation program and a government-funded family-leave program instead of wasting their time trying to convince people that the programs shouldn’t be combined.
However, that does not mean that it is always wrong for people to be paid for not working.
There is certainly nothing wrong with private unemployment insurance that pays out benefits if one loses a job. How much the benefit might be and how long it is paid is a matter between the insurance company and the policyholder.
There is certainly nothing wrong with a paid family-leave program offered by a private business or corporation as long as it is not mandated by the government. Paid family leave is just another fringe benefit that firms may or may not offer — just like vacation pay, sick pay, bereavement pay, jury duty pay, night-shift pay, and holiday pay. The provision of these benefits and their nature are between employers and employees.
Should people be paid for not working? It depends on who is doing the paying and why it is being done.