Marriage’s Role in Income Inequality

By Pete Kunze ’14

How should conservatives address income inequality? As much as Mitt Romney and the Republicans attempted to dodge the issue in the recent election and paint the Democratic presentation of it as “class warfare,” the increase in income inequality in the past half-century is a disturbing trend that demands our attention. The fact is that the tremendous economic growth experienced by the US in the past 30 years has gone largely to the richest in society. Yes, the tide has risen, but the middle and working classes, as we know them, are crumbling, and increasingly, America has been stratified into the upper-middle class and the lower class. Class solidification has clear implications; its very definition connotes something undesirable and something that Americans should work to avoid. The presence of substantial income inequality destroys any sense of community. As the rich become richer and the poor more destitute, the civic culture declines as the downtrodden feel like their participation in democracy means little to nothing.

Explanations for its occurrence and prescriptions to solve it abound, but most come from the left of American politics. Liberals would have us believe that solving income inequality just requires a simple rejiggering of our finance laws and more wealth redistribution. They have pointed to the deregulation of the financial industry and cutbacks to social welfare programs as primary causes for this slide. This, however, seems a specious claim at best. Certainly, the increased laxity in financial regulation has exacerbated the gap, and taxes on the richest would decrease income inequality in the short term, but these policy prescriptions do not pinpoint the root cause of the nation’s slide. Income inequality has risen substantially since the late 1970s, yet financial deregulation came about in the late 1980s—and only in full force in 1999, with the repeal of much of the Glass-Steagall Act in the Gramm-Leach-Bliley Act.

As for the claim that welfare programs can end income inequality, the implementation of LBJ’s Great Society programs began in the 1960s, yet inequality began rising in the late 1970s. All in all, the main problem with these liberal explanations is that they simply do not match up with the timeline of income inequality. Roughly speaking, the “Great Compression,” or the era of low income inequality, occurred from the 1940s until the beginning of the 1980s, with the “Great Divergence,” or the era of increasing income inequality, occurring into the present day. Financial deregulation and cuts to social welfare occurred both before and after this shift in income trends, indicating that other forces were at work. While an increase in marginal tax rates and social welfare may temporarily massage the numbers on income inequality, they will only mask it in the long run. Ultimately something else is amiss in the malaise of modern America.

What are the fundamental causes of this slide? I believe a number of factors intersect to cause this radical transformation – from globalization to the decline in religiosity – but I want to focus on what may be the biggest of all: the collapse of marriage.

Popular consensus has accepted the belief that marriage has declined as an institution, yet the assumption is that it either has declined across socio-economic boundaries or primarily in the upper class. Yet, the decline of marriage is most evident among those of the working class and not the rich. In the recent book Coming Apart, Charles Murray (yes, that Murray of Bell Curve infamy) divides the top 20% and the bottom 30% of Americans, socio-economically speaking, into two fictional towns: Belmont (rich) and Fishtown (poor). Using this distinction, he observes that in Fishtown, the percentage of individuals aged 30-49 who are married has fallen from approximately 85% in 1970 to 50% in 2010, while this percentage has only declined slightly in Belmont. This trend might not be a problem if not for two other disturbing trends in Fishtown: the rise of divorce and the rise of one-parent homes. In the same time period and statistical sample, the percentage of Fishtown individuals who are divorced or separated from their former spouse has almost quadrupled, rising from 8% in 1970 to 35% in 2010. In tandem with this rise in divorce, the percentage of children living broken homes has rocketed from 5% in 1970 to 23% in 2010. Additionally, among all socio-economic classes, the percentage of children born outside of a marriage has risen from 5% in 1970 to 30% in 2010; this compared with no significant increase from 1915 to 1960. When one separates these mothers by education, the trend becomes even more striking. While illegitimate births have flatlined among mothers with at least a bachelor’s degree, the percentage of illegitimate births among women who have not finished high school has soared from 10% to 60%. All in all, the institution of marriage has fallen to its knees among the working class. Divorce, illegitimacy, and broken homes are all on the rise, while marriage and traditional family life are falling behind.

“So what?” some critics will say. The institution has served to oppress women and suppress individualism. The rise in divorce rates most likely reflects the necessary dissolving of unhealthy marriages. The liberalization of family morals makes the community happier and healthier, as they can more readily fulfill their desires. Murray’s study, though, strikes down even this assumption, showing that self-reported marital happiness in fictional Fishtown has also decreased, plummeting from 68% in 1970 to 52% in 2010. Somehow, despite the supposed liberating effect of divorce, marital happiness has actually declined.

In contrast to the rhetoric of the sexual revolution, marriage not only produces more well-adjusted children but also makes the spouses more productive members of their community. The unquestioned consensus within sociology is that households with both biological parents produce, on average, better outcomes for their children than those without. The reasons for this are apparent to most observers. The presence of two parents ensures that the children receive more attention and more discipline. Divorced households unfortunately often have a competitive parenting dynamic, where the ex-spouses compete to win their children’s favor through pampering and lax discipline, or they ignore the children more in order to move on with their life. Single-parent households fare even worse, as the one parent must act as both the breadwinner and the homebuilder. These are obviously broad generalizations, but the point stands: stable marriages provide a more suitable environment for children.

Beyond the effect on child development, marriages make their participants more vibrant members of their communities. Married men earn 10 to 20 percent more than single men, and this does not simply occur as a result of any trend in partner selection, because this premium comes into effect after one marries. The sociological community has recognized and verified this bump. By virtue of bearing responsibility for a wife and children, married men conduct their personal affairs more seriously and produce more in a society. Additionally, marriage increases the civic participation of the spouses. By becoming parents, the spouses get involved in school boards, Little Leagues, and others organizations that strengthen the bonds of civic unity. Remaining single increases an individual’s isolation and results in more and more people “bowling alone,” as Robert Putnam described America’s collapse in social capital.

Where does this fit into the story of income inequality? Contrary to popular perception, marriage has not collapsed in the upper class. The majority of the previous statistics mentioned applied exclusively to those in the bottom rung of society, while the “Belmont” sector has remained relatively stable. In any case, the decline in marriage has produced a less vibrant civic society from the bottom up. It has made the working class less capable of producing in the economy, and handling unforeseeable circumstances. Nostalgic as it may seem, American communities once provided for its members when someone lost their job or suffered from an illness. As these communities have lost their vitality, the impetus for state intervention has increased, leaving those in hard times at the mercy of the government. It has increased crime and has destabilized once strong communities. Increasingly, members of the working class live not as citizens of actual communities but as wards of a faceless state.

Naturally, critics will point to the collapse in high-paying industrial jobs as the reason for the decline of marriage and civic society, yet this cannot explain it all away. Taking the recent recession out of the picture, the American economy has not experienced a protracted downturn in the past 20 years – and income inequality was on the rise that whole time. Additionally, the absence of high-paying union jobs should not preclude men from entering the workplace altogether. Since the 1970s, participation in the labor market among working-class men has dropped, with approximately 12% of males with only a high school diploma out of the workforce in the mid 200s, compared to 4% in 1960.  One may try to explain this withdrawal from the market as a consequence of falling wages, but a decrease does not unambiguously lower the labor supply. An individual can still make above the poverty line by working about 50 hours a week at minimum wage. An unfavorable labor market, then, cannot explain the decline in working class industriousness. Moreover, generally speaking, the men who drop out of the workplace are not doing so to re-educate or retrain themselves. Perhaps the best explanation really is that marriage has collapsed and thus the working class has as well. Is this the fault of these individuals? No. Extenuating circumstances mean that the blame cannot rest solely on the members of the working class for this collapse, but the decline has occurred nonetheless. Thus, regardless of who bears the blame, we must solve the decline of marriage and community life in order to stem income inequality.


What can we do?

What is there to be done about marriage? – Unfortunately, not much. Aside from making divorce legally more difficult, government policy cannot do much to reverse marriage’s downward trend. It will require an individual rededication to the institution, a social movement beyond the powers of government. What can be done, however, is a drawing back of the welfare state. The state’s welfare initiatives have done the opposite of what they promised to by “enfeebling,” as Charles Murray puts it, our civic institutions. By assuming responsibility for a community’s welfare, the system has removed the incentive for civic institutions to function properly. When the state takes over the role of charity-giver, it not only deprives the word of its voluntary character, but it also eliminates the responsibility the community once had for caring for its destitute. When the state steps in to cover medical costs, it removes the impetus the community once had to pool its resources to care for the sick. Simply put, when the state steps in, it undermines the strength of a community. Some economists have proposed a guaranteed minimum income as a solution, believing that individuals can make better choices with money, than the government can. This cash grant would allow citizens to become citizens again and choose for themselves, instead of the government acting as their proxy. Individuals will have security but also an incentive to spend it efficiently and in ways most desirable to them.

Personally, I favor this proposition, although I have some reservations about its implementation. More importantly, like any good conservative, I doubt the efficacy of any government program, even a relatively hands-off one such as guaranteed income, at turning the tide in American society. Ultimately, a civic revival must happen. Our society must turn back to its values of hard work and honesty. It must turn back to the institution of marriage and all the benefits it brings. It must again do what it made it great and form infinite associations with each other. The increased isolation of our society has and will always harm the great American dream, by failing to restrain the excesses of self-interest. Conservatives must not ignore income inequality, but must present the alternative narrative of its cause. For too long, liberals have dominated the conservation, painting it as a result of hare-brained Republican policies. The time has come for conservatives to pull their fingers out of their ears and start engaging in the discussion of inequality. If we do not, then the further crippling of American community is all but inevitable.

 

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One thought on “Marriage’s Role in Income Inequality

  • June 2, 2013 at 8:19 am
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    A few points:

    1. Financial deregulation: Deregulation happened much earlier than the author assumes. The consequences of any such reforms admittedly take some years to be felt, but I think the author is ignoring some other events. In the 1960s, immigration began to be liberalised. In 1973, Nixon effectively devalued the dollar. In 1978, Volcker became head of the Fed and pursued aggressive monetarism. This also lead (indirectly, though perhaps intentionally) to the repeal of usury laws in the states, since the Fed’s rate began to eclipse legal caps. Major financial deregulation under Reagan started in 1982 (Garn-St Germain Act), not the late 80s. Over all this time, trade was being slowly liberalised.
    Most Western countries, not just the US, began to shift policy in the mid-late 70s, albeit to differing degrees, towards financial deregulation, free trade, free labour migration, and indirect/regressive taxation in place of high corporate/income tax.

    2. The Great Society was never really a means for creating *income equality* – for that, you need strong labour unions and collective bargaining. It is simply a way to manage poverty and, to a degree, to socialise the cost of low wages. You make minimum wage but have a family? It’s okay, the taxpayers will subsidise you so you won’t starve! However, your boss is off the hook as he pays less to support you via taxes than he would directly with a liveable wage.
    The Great Society did include some pro-labour provisions at first, and incomes had another 10 years of becoming more equal, but these provisions have since been undermined or repealed.

    3. The author’s general point that family structure is socially beneficial and better economically at least for the family’s members is certainly well-taken, but I am not sure this would show up in statistics. There are two problems I see:
    a) The household income for a family-of-four supported by one $50k income is … $50k, or $12.5k per capita. The latter hardly appears prosperous on the surface. A single man living alone with the same salary is $50k/household and /per capita. A childless couple where the wife might have a secretarial or teaching job making $30k yields a household income of $80k and $40k per capita. If they have two children that is $20k per capita, but, with both parents usually absent in the day, the social benefits of marriage are reduced as the children are raised by day care or the television.
    The point is that marriage hardly increases income equality statistically, and whenever it might, it tends to depend on both parents working, which in turn reduces the social benefits you cite.
    b) There is an obvious chicken-or-egg problem: Is economic depression a sign of cultural decay or is it caused by it? I would say they feed each other in a vicious cycle, but I would say economic pressures forcing parents to work longer and stressing out relationships is a stronger original cause for family decay than the hypothesis that negative cultural trends cause inequality.
    After all, the author defends upper class family structure – but only there do we have any real mass of feminists dedicated to their independence above any family values, not among the lower classes. They might marry – but remain childless, which still increases their per capita income vis-à-vis a traditional family.

    4. Marriage is obviously less popular among the lower classes (and always has been), but divorce is more than proportionately less popular (and always has been). The upper class merely institutionalises its decadence.

    5. People are not going to get religion just because you gut the welfare state. My prediction is a few more people would go on birth control rather than have babies, but it won’t encourage people to marry when their underlying economic situation is unstable. If you want relatively non-coercive measures, I would suggest offering meaningful tax breaks for marriage/dependents and cash transfers for mothers staying home with children, as well as parental leave. But, of course, there is no substitute for having well-paying, stable jobs that can support families – which means a revision of free trade, free immigration, and financial deregulation.
    Simply glorifying upper class family structure, where the grand majority of marriages end in divorce and the birth rate is low, and suggesting reforms to encourage people to emulate this, may stop illegitimacy from increasing – but only at the price of an Italian- or Russian-style catastrophic drop in the birth rate.

    Reply

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