Spinning Necessity as a Virtue: Families to Stand in for Fragmenting Social Safety Nets

An anodyne seeming article at VoxEU, which I reproduce in full below, makes a straightforward seeming case for policies that bolster family ties in the face of a nasty combination of aging populations and high unemployment among the young.

It isn’t hard to see that this line of thinking is the policy equivalent of getting in front of a mob and trying to call it a parade. We can already see that in bad economic times, many people turn to relatives for help. Kids leave home later, and my impression is having parents help with buying a home is far more common than when I was young. It was unheard of for someone middle aged to move in with his parents; now that sort of story is a human interest staple. I suspect that we will see a partial reversion to the living arrangements of 50 to 100 years ago, when it was more common for multiple generations to live together (which will increase average household sizes and might make better use of McMansions at the expense of new home construction).

And even the wealthy worry about their ability to take care of their kids. I saw someone today whose joked that his wife’s car was in a list published last weekend of the 100 most expensive cars in Connecticut. He said that even though his kids were smart and would probably go to good schools, he was not sure they’d be able to get jobs. Normally, if push came to shove, he’d be able to get them quietly hired by a friend if the employment market was terrible when they got out of college or grad school, but many of his colleagues were retiring or downsizing their businesses. And even though they’d never starve, he thought it was very important that they work so as not to become trust fund wastrels, or worse, druggies.

This VoxEU piece tries to put a positive spin on this trend, but I would not view it as happy. While our atomized society in the US is highly neurotic, my sense is that the weakening of community ties and short job tenures (meaning tenuous social relationships in the workplace) are bigger culprits than nuclear families, which became the new normal in the 1950s and 1960s. Yet economists are deeply wedded to the idea of isolated individuals acting in markets, and it also suits politicians. Napoleon remarked that he was keen on promoting individualism, since it made people easier to control.

Similarly, Emile Durkheim described the difference between primitive societies, which he called “mechanical societies” (reversing the industrial metaphor) because people were interchangeable parts, with advanced, “organic societies,” which have a great deal of specialization and role differentiation. It isn’t hard to see that a necessity-borne emphasis on family bonds will force women back into more traditional roles of caretaking whether they want that or not.

Consider this selection from Wikpedia:

As the society, Durkheim noted there are several possible pathologies that could lead to a breakdown of social integration and disintegration of the society: the two most important ones are anomie and forced division of labor; lesser ones include the lack of coordination and suicide. By anomie Durkheim means a state when too rapid population growth reduces the amount of interaction between various groups, which in turn leads a breakdown of understanding (norms, values, and so on). By forced division of labor Durkheim means a situation where power holders, driven by their desire for profit (greed), results in people doing the work they are unsuited for. Such people are unhappy, and their desire to change the system can destabilize the society.

And to the post that produced these musings, and hopefully further reader discussion:

By Edoardo Campanella, Economist at the Fiscal Affairs Department of the Italian Upper-House. Cross posted from VoxEU

Western countries with ageing populations are in the grip a cruel irony. At the same time as having more old people than ever to support, youth unemployment is at its highest levels for a generation. As many of these countries go into elections this year, this column warns against populist politics that panders to the grey vote, and instead calls for leadership that puts the family first.

Deep economic crises encourage a radical rethinking of the socioeconomic model that generated them. The combination of shrinking economies, political stalemate, and growing social resentment is inducing people, especially the younger, to question a model of society that is prone to generate huge inequalities as well as great instability but is incapable of providing a long-term direction in difficult times. With general elections approaching in most European countries over the next 12 months, there are all the ingredients for populism to emerge. If so, Europe, not just the common currency, will be under serious threat.

To avoid this scenario, it is imperative for aspiring, reliable candidates to speak hard truth to their voters by explaining that sacrifices are not over yet and that more are necessary to tackle the challenges posed by the global market forces that are undermining Europe’s prosperity. To persuade their fellow citizens to accept new cutbacks, politicians have to inspire their voters with a shared long-term goal – one that is capable of strengthening social cohesion, motivating common efforts, and justifying reciprocal concessions.

In the past, political ideals or religious precepts projected a country into the future by treading the path towards a common goal of justice, equality, or fairness. The end of ideologies, following the fall of the Berlin Wall, along with a growing tendency toward secularisation, multiculturalism, and individualism, has left our society with no driving values. Therefore, what begs asking is whether today’s leaders can find a new driving force to revive common interest in their societies.

Family and political consensus

Nowadays, politicians should look at family, meant as a socioeconomic institution, to replace ideologies or religion in creating political consensus. Across time and space, it has always been the cornerstone in building a sense of community and creating the commitment to the common good. As acknowledged by the European Parliament in 2010, family produces assets and factors for development by promoting peace, stability, and cohesion as well as freedom, responsibility, and solidarity. And in time of crisis, like the current one, it acts as ‘shock-absorber’.

In greying Western societies, where old people rig political and economic life for their benefit, family is the only institution able to build a bridge between young and old, merging opposite individual interests into a common general one. By creating strong and natural intergenerational links, family projects society into the future by charting a path towards an ideal of fairness between generations that benefits everyone regardless of economic status, religious view, or political affiliation.

Yet the countless spiritual virtues, material benefits, and political implications accruing from kinships have long been unnoticed by politics, if not in appearance, surely in practice. In recent decades, myopic leaders, not realising the importance of these intergenerational links, have created consensus and maximised their chance of election just focusing on the most numerous group, the elderly. In several advanced economies, the accumulation of explosive public debts, soaring youth unemployment rates, and dual labour markets are side effects of this political approach.

An enlightened leader should realise that people, at least with their close relatives, are altruistic, not selfish. Parents care about the opportunities of their offspring, and the youngsters wish their old relatives to live an untroubled retirement with the assistance of the state. This intra-family altruism spreads out to society as a whole, making policymaking more far-sighted.

Focusing a political campaign on the democratic minority, the youth, will capture the votes of many old fathers. And the elderly will be happy twice over.

• First, their children will realise their dreams.

• Second, the young people, being again the engine of the economy, will increase the size of the cake for the oldsters as well.

Thus, by playing on family ties, politicians could persuade older voters that an increase in the retirement age or other fiscal austerity measures are not a dolorous renunciation, but a way to relieve their offspring from unfair obligations. And today’s young people, once old, will follow suit in honouring the social contract. This is the political approach adopted by Mario Monti’s government to persuade Italians to accept today’s sacrifices in exchange for tomorrow’s benefits.

The role of family-friendly policies

But passively appreciating the social, economic, and political benefits accruing from intra-family altruism is not enough to strengthen social cohesion. European leaders should actively promote family as a fundamental principle of our society by adopting a wide set of policies:

• They should guarantee job and economic security to younger generations to favour the creation of new family units.

• They should implement family-friendly policies to help people striking a better work-life balance, thus increasing the fertility rate (OECD 2007), beefing up the workforce with young workers and preserving the stability of the pension systems without relying on massive and costly immigration.

• Politics should adopt measures able to shape the family-model in a growth-friendly way. As shown by Alesina and Ardagna (2010), strong and oppressive kinships, while indeed associated with higher fertility rates and higher levels of happiness, tend to crowd out the market, reduce labour mobility, and increase rigidities in the labour market. Therefore, a well-designed family-model will avert the ‘amoral familism’ trap described by sociologist Edward Bunfield (1958).

• Reforming the pension systems and eradicating dual labour markets will make intra-family altruism flow in the right direction. In the past, adult children were obliged to care for old and sick parents. After the creation of the welfare state, government-funded pensions and medical assistance replaced this obligation, even if younger workers’ taxes financed such schemes. But nowadays in Europe the role of family in the transmission of economic resources is reviving, with huge flows of wealth from old to young. On an individual basis, old people’s transfer of resources to their adult children may well be motivated purely by parental love. But, from the perspective of their group interests, these transfers represent a concession aimed at preserving from collapse a system that is skewed in their favour. Therefore, European countries should alter their social contract by redirecting more resources to the young (Campanella 2011).

Conclusion

The next round of voting in Europe presents a great opportunity to rebalance the current socioeconomic model, providing people with a direction in their daily life and avoiding the enormous costs associated with a transition to a yet unspecified alternative model. A family-based approach to politics could sweep away the bleak shadow of populism.

This post originally appeared at naked capitalism and is posted with permission.