More on the Corruption of Scientific Inquiry

Almost to the day a year ago I wrote an article on this blog about the corruption of scientific inquiry. I used my own experiences with peer-review research in economics and political economy, and pointed to what it means when social scientists in general, and economists in particular, fail or even cease to apply basic, well-tested methods of peer review and the relentless pursuit of better knowledge. While bad research in physics, chemistry and biology can have long-term negative consequences for the work of engineers, medical professionals and the pharmaceutical industry, people often overlook the consequences of subpar research in political science, political economy and economics.

In fact, the consequences of bad social-science research can be immediate, severe and systemic. The entire European economic crisis was escalated from a normal, albeit relatively serious, downturn in the business cycle to a depression as a result of economic policies founded in bad, poorly designed and executed research.

However, the European crisis is only one example of many. The consequences of poorly executed research in economics are ultimately rooted in how graduate students are educated today. As I noted a year ago:

I have often wondered if the disappointing state of economics, both as an academic discipline and as a science, is due to the manic obsession of economists with multivariate regressions, second-degree differential equations and Cobb Douglas utility functions - or if it is part of a broader trend of corruption of modern science in general. One does not exclude the other of course, but with all the junk - pardon my Danish - that is being churned out by academic journals these days one cannot help wondering how we manage to keep the tabs of quality on it all.

One of the many problems with how economists are "brought up" these days is this emphasis on technical skills. The more time graduate students spend on mastering those, the less he or she will spend on theory, methodology and on developing the skills of systemic thinking that were so prevalent among economists in the first half of the 20th century.

As a result of the technicalization of economics, graduate students never develop the ability to actually pursue scientific inquiry. Their research, which builds their career from assistant professor to tenured faculty, takes the form of "the effects of X on Y". This type of question may interesting in itself, but it quickly becomes trivial from a truly scholarly viewpoint. After all, do you need years of graduate studies at a reputable university to learn how to answer such questions?

No, you don't. Yet our graduate schools have become assembly lines for highly advanced correlative statisticians. As an unintended, but certainly accepted, consequence, the prevailing wisdom of what it means to do research is one of fragmentation and a narrow scope of what questions to ask - and not to ask.

A friend, a retired professor of economics, mentioned that at the universities where he taught during his academic career, the policy these days is to have every graduate student with complete course work co-author three peer-review papers and then defend their dissertation. That is, he said, how all grad students at those universities earn their doctorate these days.

This might seem like a trivial issue for the outside viewer. It is, however, one of the keys to understanding how a scientific discipline breaks down and loses its scholarly content. My own dissertation was a monograph - unheard of today - which forced me to comprehensively understand a systemic issue (in my case macroeconomic stability) all the way from highly theoretical contributions on the foundations of economics, through complex methodological writings on probability, uncertainty and prices, to what all this meant at the ground level in political practice.

I was no genius back then (nor will I ever be...). I merely followed a tradition of scholarly training and education that goes back centuries. I wrote my dissertation in the same tradition that far brighter minds had done, from the founders of economics to those who modernized it and made it applicable to a monetary, industrial economy.

However, this traditional form of scholarly growth has distinct merits that these days are being pushed to the margin. It is not just in economics and political economy (though I will continue to brag by referring to my upcoming book on Routledge, The Rise of Big Government, as an example of how to put systemic thinking to work) but as revealed in an article in Nature from May last year, the fragmentization of scientific thinking is working its way into the natural sciences as well.

In natural sciences, reproducibility of experiments is a benchmark method for evaluating research. Nature reported that an alarming rate of published research is irreproducible:

More than 70% of researchers have tried and failed to reproduce another scientist's experiments, and more than half have failed to reproduce their own experiments. Those are some of the telling figures that emerged from Nature's survey of 1,576 researchers who took a brief online questionnaire on reproducibility in research.

The article opens a frightening window into the production process of modern natural-science research; fortunately, in a survey that the Nature article reports, 88 percent of scientists admitted that there was a significant or slight reproducibility crisis in their disciplines. That number is ground for some hope of a self-correcting process in the sciences, although one has to ponder the question asked by Michael Guillen, Ph.D. and former science editor at ABC News, in a recent article at The Global Warming Policy Forum:

Leaving unspoken this elephant-sized question: If we aren’t able to trust the published results of science, then what right does it have to demand more money and respect, before making noticeable strides toward better reproducibility?

Although reproducibility in natural sciences and systemic thought in social sciences are two different components of scholarly thought, they have one important thing in common. The subject of the natural sciences - nature in its broad form - lends itself to laboratory tests, hence the basic requirement of reproducibility. Social sciences, on the other hand, study the entirety of the social human existence; the sum total of the outcomes of human interaction - social, moral, cultural, economic - is in many ways larger than the addition of the actions of individuals. It is the amended entities that enlarge the sum total, that constitutes the system we refer to as "society". 

In order to understand human society, one cannot begin with laboratory-level studies. The reproducibility method, which is essential to the natural sciences, is alien to the foundation of social sciences. That does not mean it is irrelevant or misplaced within the social sciences - there is good use for it in psychology and microeconomics - but it does not help the social scientist build an understanding of the systemic properties of human society. 

The breakdown of the reproducibility method in natural sciences is a direct threat to the integrity of those sciences. By the same token, ignorance of systemic thought in social sciences has already compromised the integrity of economics, and is on its way to do the same with political science.

There are institutional reasons for why we as a society are weakening our scholarly intelligence. We have turned far too many of our academic institutions into skills factories. An academic program in economics today has more in common with an advanced vocational institution than a traditional place of scientific inquiry. Given the Nature article, and Dr. Guillen's comments in his Global Warming Policy Forum article, it is entirely possible that something similar is happening to the natural sciences.

When the Right Surrenders, Part 3

Two Washington-based think tanks, American Action Forum and American Enterprise Institute, keep pumping out papers and op-eds promoting the idea of Paid Family Leave. The idea behind this entitlement program is lifted directly from the Scandinavian welfare states, and is one of only three major entitlement programs that institutionally separate the American welfare state from its Scandinavian brethren. Now, apparently, these two think tanks have decided that time is ripe to close the gap between our egalitarian project, and the role model according to which it was designed. 

The primary proponents of Paid Family Leave are Ben Gitis, director of labor market policy at the American Action Forum and Angela Rachidi, research fellow in poverty studies at the American Enterprise Institute. Gitis has promoted a broad-scale Paid Family Leave program in a separate publication; for now, he and Rachidi have decided to focus on one part of the Paid Family Leave conglomerate, namely paid parental leave from work to care for a newborn baby. 

In an op-ed in the Washington Examiner on April 3, Rachidi introduces their idea as the logical expansion of the welfare state it is - provided that one does not care about the massive fiscal and macroeconomic problems that come with a welfare state in the first place. The same enthusiasm for expanding the egalitarian project we know as the welfare state, is found in the policy paper that Gitis and Rachidi published in March. They explain their idea: 

This proposal follows up on the American Action Forum's proposed Earned Income Leave Benefit (EILB), a highly targeted program that would provide paid parental, family care, and medical leave to workers in low-income households. In this paper, we narrow our focus on paid parental leave for the birth or adoption of a new child and outline a proposal to provide paid leave to low-income and lower-middle-income working households. This proposal is intended to supplement what the private market already provides, as well as to offer job protection and paid leave to those who do not currently receive it. 

Unfortunately, their entitlement program is littered with the exact same problems that characterize every single corner of the egalitarian welfare state. It is clear that Gitis and Rachidi have not done their homework on this subject.

Let us begin with the notion that an entitlement program can be restricted to poverty relief. History has proven otherwise, over and over again. For example, when Social Security was introduced in 1935 it was meant to be a supplement to private retirement plans, providing poverty relief in the spirit of conservative paternalism. Yet over the years the program has expanded and is now the nation's backbone of retirement security. In 2013, 64 percent of all eligible Americans received at least half of their income from Social Security.

Another example is the Food Stamp program, also created strictly for poverty relief. Over the decades it has expanded enrollment and slowly morphed into an entitlement program with broader reach than just those living in poverty. As recently as during the Great Recession, 2008-2013, the program increased its enrollment three times faster than the poverty population.

SCHIP is a third example. It was introduced by then-U.S. Senator Ted Kennedy (D-MA) and used the same architecture as a poverty-relief health insurance program in Massachusetts. In other words, SCHIP was intended for the poor. Yet already in 2002, five years into its life, the program enrolled 24 percent of all kids younger than 18. The poverty rate among this demographic was 16 percent. 

In 2012, right at the end of the Great Recession, the poverty rate among children had risen to 21 percent, but SCHIP enrollment had increased to 35 percent.

These are only three examples of how entitlement programs have expanded far beyond their initially defined scope - which in all three cases happens to be to ease the hardship of poverty. It is therefore only logical to expect that the Gitis-Rachidi entitlement program will also expand far beyond its original purpose, thus drastically raising the cost to taxpayers. 

Are Gitis and Rachidi happy with this?

On a related note, Gitis and Rachidi suggest that their model would provide paid-leave benefits to workers who do not have such benefits now. With a means-tested program, they say,

the federal government would provide the benefit to only low- and moderate-income workers, who are the least likely to have paid parental leave in the first place, reducing the chances that many employers will drop more generous packages. 

As they continue,  they make a point out of the government program being more stingy than private-sector offerings:

Phasing out the benefits at higher [income] levels also ensures that more moderate-income families are less likely to receive better benefits from the government than what is available through their employer.

This idea of keeping the government program stingy creates a conflict of purpose, which I discussed in an earlier article on this issue. Aside solving that conflict - which is no small feat in itself - there is also the ever-present problem of marginal disincentives. At no point in their report do Gitis and Rashidi mentiond this problem.

Another institutional problem with this paid parental leave program is that it does not even succeed in its core purpose, a purpose that Gitis and Rachidi define as:

paid parental leave for the birth or adoption of a new child and outline a proposal to provide paid leave to low-income and lower-middle-income working households. 

The entitlement is provided "to workers in households under 325 percent of the federal poverty threshold". 

Since it is aimed at economically facilitating child birth and its immediate aftermath, one would assume that the entitlement program would be constructed in such a way that it benefited households that are most likely to have a child. In the past 25 years, the U.S. fertility rate has hovered around 2.0 (slightly lower during the Great Recession), which means that the households that are most likely to add a child are those with no kids, or one kid. Therefore, it would be logical that Gitis and Rachidi would design their program to benefit specifically those households.

Curiously, that is not the case. On the contrary, a comparison between median household income and the benefit threshold shows that the Gitis-Rachidi model is least generous toward households that are most likely to have children. 

Here is how their model fails. We start with median income, which is the "half way" point of income for a population group: half of all households in that group make less than median income, while half of them make more. In other words, if Gitis and Rachidi used median income as its eligibility cap, they would make exactly half of a specific demographic eligible for their entitlement.

If the eligibility cap exceeds median income in the defined demographic, then more than half the population of that demographic is covered; less than half is covered if the cap falls short of median income.

Table 1 shows how Gitis and Rachidi fail to target their entitlement program to those they say they want to provide for. In the demographic groups that are most likely to have more kids, their program can be expected to cover the fewest households. The last column of Table 1 divides median income with the income that equals 325 percent of the federal poverty limit for that demographic:

Household size	Median income	325 percent of FPL	Median/325
1	28,800	39,267	136%
2	63,850	50,021	78%
3	73,990	62,004	84%
4	87,739	78,117	89%
5	78,662	91,930	117%

On page 5 in their report, Gitis and Rachidi claim that their model targets "those who need it the most". Table 1 shows that they actually target those families that are the least likely to have a baby, namely single-individual households and families with three or more children.  

Perhaps the biggest problem with their proposed program is a classic, and endemic problem with egalitarian entitlement ideas: discouraging self determination. Part of this problem is that entitlement programs tend to give private employers a good reason to drop privately provided benefits and instead dump their employees into tax-paid programs. Gitis and Rachidi beat about this bush quite a bit, only providing speculative thoughts on how private employers might react. 

However, we do not have to resort to speculation. All we need to do is look at what happened when Obamacare went into effect. As soon as individual health plans were available, employers both small and large began dropping health benefits, expecting their employees to find new, tax-subsidized plans through the ACA exchanges.

As if to top off the list of problems with their entitlement program, Gitis and Rachidi manage to put together an entitlement program that can actually provide a stronger financial disincentive toward self determination than even the EITC. A key element of their program is, as mentioned, that the benefit is phased out with household income rising above a certain point. 

Since this entitlement program is meant to provide a benefit at a specific, and relatively rare, occasion in people's lives, it de facto functions like a savings account. Just like parents could use their savings to cover income loss while caring for a newborn, they use the benefit in the Gitis-Rashidi entitlement program. 

Suppose a family is considering having another child. In the meantime, the father is offered a promotion that will increase the family's income from $35,000 to $40,000. It also means they have to move to the other side of town, an expense they will cover out of their savings account.

On the one hand, they now have more money in their pockets per month, thanks to the raise; on the other hand, they have less money in the bank, making it tougher to get through the weeks and months after their new baby is born.

The difference, of course, is that unlike the Gitis-Rachidi entitlement program, a savings account would not discourage people from making other important life choices beside having a child. Suppose that a family, having access to the Gitis-Rachidi program, is considering two simultaneous decisions: to have a baby and to accept a promotion that will allow one of the parents to earn $5,000 more per year. 

At an annual income of $35,000 - equal to $673 per week - this family gets $388 per week in parental benefits. If the parent that has been offered a promotion decides to accept it, their weekly earnings increase to $769. At the same time, the parental-leave benefit falls to $342 per week. 

Does the parental-leave program help the promotion-offered parent to give a thumbs up or thumbs down to the offer?

The answer is no, and here is why. Almost half, or $46 of the $96, of the raise is lost because, during the parental-leave period they would get a lower benefit if the promotion goes into effect before the child is born. 

Add to this the federal income tax, which goes up by $15. The weekly pay raise is now reduced to $35. Then they lose $21 worth of Earned Income Tax Credit, and the family is left with a meager $14, or approximately 14.5 percent, of the initial raise. 

The Gitis-Rachidi entitlement program is responsible for 56 percent of the evaporation of the pay raise. This means, bluntly, that Gitis and Rachidi have constructed an entitlement program that:

a) does not primarily benefit those it says to wants to benefit;

b) risks becoming significantly more expensive than they estimate;

c) has no clear funding source; and

d) builds up significant disincentives toward career development and self determination.

In other words, their Parental Leave entitlement program is a pure-bred egalitarian idea, true to the ideological foundation of the Scandinavian and American welfare states. It is a program with the same potential to do major fiscal harm to the federal government, and significant macroeconomic damage to the economy as a whole. 

Perhaps Gitis and Rachidi had been more careful in their proposals if they had taken the time to study the macroeconomic consequences of the welfare state. Maybe the would change their minds if they studied income-security programs in other countries?

When the Right Surrenders, Part 2

I do not like criticizing fellow conservative/libertarian/free market proponents. There is enough work to be done to counter the egalitarian onslaught aiming for continuous expansion of the American welfare state. However, sometimes it is necessary to set the record straight within our own ranks, especially when a fellow traveler wanders off to the left side of the political field and comes back enamored with one of their economically most destructive ideas.

A good example is the incomprehensible interest in Paid Family Leave programs among people at the American Enterprise Institute and the American Action Forum. One of the key publications from these organizations, seeking to advance the Paid Family Leave agenda, is a report from August 15, 2016 by Ben Gitis, Director of Labor Market Policy at the American Action Forum. 

Under the title The Earned Income Leave Benefit: Rethinking Paid Family Leave for Low-Income Workers, Mr. Gitis suggests a version of the paid-family leave program that meets all the criteria of a classic egalitarian amendment to the American welfare state: it is redistributive, it is aimed exclusively at low-income earners and it creates growth-hampering taxes and worker disincentives.

Modeled after the Earned Income Tax Credit (EITC), the Earned Income Leave Benefit (EILB) would only be eligible to a group of citizens defined as "low income". In a nutshell, the EILB would:

• offer 12 weeks of paid family leave;
• tie benefits to family income at a rate of 34 cents to the dollar earned; and
• cap eligibility at a total of $27,990 of family income.

Based on these parameters, and in the absence of any funding model for the EILB, Mr. Gitis then estimates the cost of the entitlement program. He uses two methods for the estimate, one based on official statistics over how much family leave people took under the Family Medical Leave Act and the other based on the maximum entitlement value of the program. The latter method, which Mr. Gitis referred to in a  memo on January 26, 2016, and I applied to a different type of Paid Family Leave program in my July 2016 article, would cap out the cost of the EILB at $31.6 billion per year. 

Compared to my estimate from July 2016, which placed the maximum entitlement value at just over $1 trillion per year, the EILB sounds palatable, even doable. There are, however, three problems with his entitlement program that Mr. Gitis does not address. 

The income replacement rate

The most important cost-capping variable in the EILB is not the income threshold, but the income replacement rate. Currently set at 34 cents to the dollar, it is low enough to discourage most workers from frivolously using the program to get an extra week off from work. Thereby, it restrains the costs of the program without having to employ an intrusive bureaucracy to scrutinize applications for EILB benefits. 

At the same time, the choice of a low replacement rate indicates that the real purpose behind the program is not to provide a benefit, but to restrain its costs. The eligible population - low income workers within an income bracket narrower than even for the EITC - is hardly helped by a replacement rate of 34 cents for every dollar they lose by being home from work. The households that qualify for the program, as Mr. Gitis suggests it be designed, have a propensity to consume that is almost equal to 100 percent of their disposable income. 

With a pauperish replacement ratio, the EILB looks more like an attempt to have it both ways than a serious paid family leave program. Assuming that the primary goal with the program is to actually provide what its intended purpose is, namely income replacement in the event of family-related leave from work, it would be more reasonable to apply the income replacement rates included in the paid family leave program introduced in Washington, DC: for the first $1,000 of monthly income, the entitled person receives 100 percent of his income in benefit; for every dollar there above the replacement rate is 50 percent. 

Interestingly, if we use the Washington, DC replacement-rate model, and then convert the numbers that Mr. Gitis uses to reach his $31.6-billion maximum entitlement value, we find that individual beneficiaries of the EILB would receive, on average, 100 percent of their income. This raises the maximum entitlement value of the EILB to $112.9 billion, three and a half times more than Mr. Gitis suggests. 

A "compromise" replacement rate could be the 67 percent that will go into effect when the New York state paid family leave program goes into full effect in 2021. Now the cost of the EILB "only" doubles to $62.7 billion per year. 

Funding

The problem with using an unrealistically low replacement rate in the presentation of a new entitlement program is that the program, if it goes into effect, is going to be under-funded from the start. If the EILB became the law of the land as Mr.Gitis envisions it, very soon Congress would radically increase the replacement rate, with reference to "decency" and "sustainable benefits". After all, as designed, the EILB offers to keep people on a standard of living - albeit temporarily - that is below even what the federal government deems tolerable in their definition of poverty. 

Speaking of funding: at no point does Mr. Gitis explain how the EILB is to be funded. Conventional wisdom - and experience from New York - suggests a payroll tax. It is unclear who would pay the payroll tax; if the EILB benefits are restricted to only those who make, say, up to 200 percent of the federal poverty limit, then will the tax also be restricted to that group? If not; if the tax applied to all income earners; then by definition it is a program for the redistribution of income between individual citizens. 

In other words, an egalitarian expansion of the welfare state. We will have to return to that point some other time; for now, it is worth noting that the American Action Forum lends itself to egalitarian purposes.

The funding side of the EILB is more problematic than simply lack of specifics. The main issue is the calibration of the tax vs. expected cost of benefits. If we use the first method that Mr. Gitis applies, namely base the entitlement cost estimate on statistics of family leave days under the Family and Medical Leave Act, then we are very likely to under-estimate the cost. Even if we stick to the 34-percent income replacement rate, it is very likely that more people will use the program than if the replacement rate was zero. (This does not mean that the 34-percent rate is no longer pauperish; this is just an observation of human responses to incentives.) If the tax then is set after the rate of family-leave days under the FMLA, the EILB will be under-funded and add to the federal deficit. 

If, on the other hand, we calibrate the tax to fund EILB at its maximum entitlement value, it adds notably to the payroll taxes that fund what is officially known as Social Insurance and Retirement. These taxes currently deliver just over $1 trillion annually into the federal government's coffers; even if we assume that the EILB income replacement rate would only be 67 percent, the federal payroll tax rate would have to increase by 0.83 percentage points. This would take the OASDI tax rate from 12.4 to 13.23 percent. 

To many small businesses, that will be a painful increase in the cost of labor. Given how businesses have responded to the taxes added on by the Affordable Care Act, it is likely that they will scale back employee hours in response, thus neutralizing some of the expected revenue. 

Negative worker incentives

Since the EILB is designed with the EITC as its template, it also suffers from the same worker disincentives toward self determination. The EITC steeply reduces its benefits as the beneficiary's income rises, creating marginal income taxes that are only surpassed by incomes in excess of $418,000.

The EILB has a similar effect. If we stick to the original, 34-percent replacement rate, the EILB offers a maximum of $3,359 in benefits per year to a family with no more than $27,990 in annual income. Assuming that the family would have to go without any income replacement in lieu of the EILB, the EILB benefit represents a 12-percent increase in their disposable income. Suppose, then, that the main income earner in this family gets a ten-percent raise, taking their family income up to $30,789. 

Federal income taxes take 15 percent of the $2,799 raise, leaving the family with a net increase of $2,379. However, since they now passed the threshold for qualifying as low income, they lose the EILB, deducting $3,359 from their disposable income. This leaves them with a net loss of $980 per year. 

Just to break even, this family would have to get a pre-tax raise of $3,952, or 41 percent - and we have not even mentioned the loss of or reductions in other benefits, such as EITC, SNAP, TANF...

Needless to say, the EILB is a classic redistributive entitlement program aimed at advancing the same egalitarian agenda that underpins the American welfare state ever since the War on Poverty.

Conclusion

The EILB is a particularly bad idea, probably even more harmful in the long run than generalized models covering the entire population. Its limitation to low-income workers, and a replacement rate of only 34 percent, seem to be lifted straight out of a have-it-both-ways political playbook. The problem is that when entitlements are designed this way, the legislative body that has jurisdiction over them - Congress in this case - eventually has to make up its mind: is the program there for its beneficiaries, or is its design primarily for cost containment purposes? 

When that happens, the consequences are massive. Mr. Gitis would be aware of this, had he added a section to his report on the experience with these programs, and the aforementioned design conflict, in European welfare states. Yet Mr. Gitis makes no effort whatsoever to account for the international experience. This is highly unfortunate: had he acquainted himself with the ample literature on the subject, he would have avoided making the list of mistakes I have accounted for in this article.

I am left wondering what makes an otherwise apparent fellow economic-freedom traveler veer so sharply off to the left. He is not alone: as mentioned, there are plenty of examples of people over at the American Enterprise Institute who have run into the egalitarian woods and gotten lost.

Why does this happen?

When the Right Surrenders, Part 1

On this April Fool's day my good friend Dan Mitchell over at the Cato Institute explains:

Donald Trump wants the federal government to subsidize child care. If enacted, this policy is sure to increase costs and lead to inefficiency, just as similar types of intervention have caused problems in both healthcare and higher education. While Trump’s proposal is misguided, it hasn’t generated much surprise because politicians routinely try to buy votes with other people’s money. I was surprised, however, when the normally market-friendly American Enterprise Institute began to publish articles starting a few years ago in support of government policies on the related issue of paid family leave. I was even more surprised when I saw that AEI teamed up with the left-leaning Brookings Institution on a joint “Project on Paid Parental Leave.”

Since Dan insisted that this was not an April Fool's joke, I tracked down his sources. Not that I mistrust Dan - he is a rock-solid public policy scholar and a good economist - but as I kept reading his blog article, I tried very hard to convince myself that maybe, just maybe this was really an April Fool's joke.

Unfortunately, it was not. The American Enterprise Institute, which once presented itself as a conservative, free-market oriented think tank, now wants to be

a public policy think tank dedicated to defending human dignity, expanding human potential, and building a freer and safer world. The work of our scholars and staff advances ideas rooted in our belief in democracy, free enterprise, American strength and global leadership, solidarity with those at the periphery of our society, and a pluralistic, entrepreneurial culture.

 Normally, I would not pass judgment on what profile a think tank wants to have, but in this case I have to make a point about it. As a country, we are at a very important watershed moment. Our welfare state is not quite as big and comprehensive as the standard European welfare state - not yet. We are three entitlement programs away from eradicating the trans-Atlantic differnces: universal child care, universal paid family leave, and single-payer health care.

A generous interpretation of the Affordable Care Act (ACA) is that it took us half way to a single-payer system, reducing the distance to the European welfare state to 2.5 entitlement programs. As Republicans fail to unite around a roll-back plan for the ACA, they effectively remove the last obstacles for Democrats to make the final leap from today's half way model to a single-payer system. One need not go to Europe to figure out how bad this idea is; just consider the proposal for a state-level single-payer system in Colorado.

On top of that, Democrats have been favorable to universal preschool or child care - or both - since at least 2010.

At the state level, Democrats are actively pushing paid family leave at the state level, for example in New York and in the District of Columbia. Their latest presidential candidate made it part of her platform. There is no doubt that the American left harbors a deep desire to "complete" the construction of the welfare state.

Because of the serious, long-term consequences that the welfare state has had in Europe, it is imperative that conservatives and libertarians resist new entitlement programs, and that they present a clear, concise alternative to the welfare state. With this in mind, it is incomprehensible that a reputable think tank like the AEI has chosen to get on board with welfare-state expansion - unless, of course, they have chosen to redefine themselves and abandon their former conservative, free-market values.

That would be sad, because the fight over the welfare state is not just a fight to save our prosperity, although that is where most of the battles will be fought. But it is also a question of whether the United States of America is a country defined by principles of limited government, free markets and personal responsibility; or if it is just another egalitarian welfare state. 

This is a question of how ideas shape the lives of 320 million Americans here and now, not to mention coming generations. Therefore, it imperative that conservatives and libertarians accept the challenge from welfare-state protagonists and meet them head on. 

A good place to start is to counter the welfare-statist proposals from the American Enterprise Institute. For example, here is what Columbia University professor of social work Jane Waldfogel writes for the AEI:

More than twenty years ago our country enacted the Family and Medical Leave Act (FMLA), recognizing that workers should not lose their jobs because they have a new child, have a close family member who needs care due to a serious illness, or are seriously ill themselves.  ... The Act has since been amended to recognize special caregiving needs that may arise when family members are serving in the military or are injured during that service. I believe that as we move toward a national paid family and medical leave policy, our goal should be to offer paid leave for all the types of leave covered under the FMLA.

This entitlement package would cost taxpayers north of $1 trillion per year. It would create a spending program that exceeds Social Security in size, administrative rigidity and regulatory complexity.

Impervious to the gargantuan cost of her entitlement proposal, Waldfogel continues:

Parental leave — to care for a newborn or newly adopted or newly placed foster child — is the simplest policy to design and enact. ... Other family leaves – to care for a child, parent, spouse, or other close family member with a serious illness such as cancer, or to provide care related to a family member’s service in the military – can be just as necessary, but may occur more than once or twice, may occur unexpectedly, and may be harder to define and verify. Similar challenges apply to medical leave. For these reasons, there is currently a debate about whether the US should enact a national paid family and medical leave law or should move first on enacting paid parental leave. I favor the more comprehensive approach, because it would be unfair to offer one employee paid leave to care for a newborn while not offering paid leave to a co-worker to care for a child or other close family member with cancer, to receive treatment for cancer him/herself, or to care for a family member who needs care related to service in the military. Moreover, if all employees are going to pay into a program, it’s only fair that parents and non-parents should benefit.

 The AEI has published a 21-page report specifically on paid parental leave. It is co-authored by Ben Gitis, director of labor market policy at American Action Forum, an organization that

injects forward-thinking ideas into the public debate that will build a better economic future, promoting innovative, free-market solutions to create a smaller, smarter government.

The other co-author is Angela Rachidi, research fellow in policy studies at the AEI. In other words, both authors represent organizations that traditionally would be considered closer to free-market ideals than welfare statism.

Paid family leave is one of the most destructive entitlements ever invented. Regardless of whether it takes the form of a traditional government-run entitlement program, or a micro-managing regulatory package, it imposes serious costs, both ethically and economically, on families and businesses. These costs are largely unknown to an American audience, which is why I am going to address them in a series of blog articles, from its ideological core to its fiscal consequences.