President Obama has used grand rhetoric in declaring that all Americans should receive paid leave when they have a baby. “Only three countries in the world report that they don’t offer paid maternity leave,” Obama said in his weekly address Saturday. “And the United States is one of them. It’s time to change that. A few states have acted on their own to give workers paid family leave, but this should be available to everyone.”
Yet 5½ years after taking office, Obama has no proposal on the table for paid family leave. He hasn’t endorsed the leading Democratic proposal on Capitol Hill — the Family and Medical Insurance Leave Act — which would guarantee 12 weeks of paid leave. Instead, when asked Sunday about the lack of a proposal or support for such a plan, a senior adviser, Valerie Jarrett, said only that “this is the beginning of that conversation.”
As Obama holds a high-profile “working families” summit Monday, paid family leave is perhaps the most glaring issue where his proposals fall short of his rhetoric -- unlike other issues for which Obama has proposed big ideas but seen them rejected or ignored by an uncooperative Congress.
Why hasn’t the president been more aggressive on family leave? He's enacted other major family-related benefits, such as a the expansion of health care insurance under the Affordable Care Act, and proposed other child-focused policies, including a plan to offer pre-K to 4-year-olds from low- and moderate-income families. The idea of paid leave, however, hasn't seriously come up in White House policy discussions, according to a person who has been deeply involved in those talks.
The reason has to do with the substantial cost of such a program, and the difficulty of funding it without raising taxes on the middle class — which would violate a major 2008 campaign promise.
Recall that during his first presidential campaign, one of Obama’s big promises was that he would not raise taxes on any household earning less than $250,000 a year. He has tried to hold firm to that pledge, rejecting pressure from liberals who argue that it creates an unnecessary limit on what he can accomplish.
Funding national paid leave, however, would likely involve a significant breach of that promise. The Family and Medical Insurance Leave Act, or the FAMILY Act, would offer workers 12 weeks of leave at two-thirds of their salary, up to $1,000 a week. Such a program would likely cost more than $20 billion a year.
To fund it, the legislation would increase the payroll tax contribution for workers and companies by 0.2 percentage points. All workers, rich and poor, would pay. A worker earning about $50,000 a year, for instance, would pay about $100 more in payroll taxes, as would his or her employer. The legislation, developed by Rep. Rosa DeLauro (D-Conn.) and Sen. Kristen Gillibrand (D-N.Y.), along with the Center for American Progress, has 88 co-sponsors in the House and five co-sponsors in the Senate.
Obama has been willing to make small amendments to his no-taxes pledge over the course of his term. The Affordable Care Act imposes higher taxes on people who use tanning salons. And the president’s universal pre-K idea would be funded by higher tobacco taxes.
But in each of these cases, White House advisers argue they are funding good policies at the expense of harmful behaviors. By contrast, funding paid leave wouldn’t involve just smokers or people who want to sport a good, if artificial, tan. It would involve every working American.
On a conference call Sunday, senior Obama advisers said the president is deeply committed to the idea that every parent should be able to take time off to care for a new child, but they acknowledged the constraints they face — some self-imposed. “Cost is an issue for any federal program,” Jarrett said, “and we need to make sure that we do this in a way where we are not raising taxes on middle-class families.”
Jarrett said the administration has included in its budgets money to study or support paid leave programs in the states, and that Obama believes that the summit and other efforts will be “a great opportunity for us to have that conversation and to put the national spotlight on an issue that our competitors around the world have figured out.” She said “due diligence” is necessary before contemplating any national proposal.
Betsey Stevenson, a member of the Council of Economic Advisers, also noted that Obama has supported legislation that would give family leave to federal employees. Using his administrative powers, he has long offered family leave to employees of the White House.
But it is unlikely that anything short of a national program is likely to match Obama’s bold argument that paid parental leave should be “available to everyone.” Today, the governing law in this area is the Family Medical Leave Act, passed in 1993, which guarantees employees 12 weeks of unpaid leave to take care of a new baby or sick loved one. Workers cannot lose their jobs during this period. The law only affects companies with more than 50 employees, though many smaller firms also offer unpaid leave.
But relying on companies to pay for that leave time as part of a benefits package is not effective. Only 12 percent of workers have access to paid family leave, according to the Labor Department, and it is more often available to workers who are already better off. In fact, workers in the top quarter of earners enjoy access to paid family leave at four times the rate of workers in the bottom quarter of earners.
Nor will relying on states work. Only three — California, Rhode Island and New Jersey — offer paid leave to employees in their states. And these are often imperfect arrangements.
Take California, which started a program of offering most workers paid leave a decade ago. Employees at all companies, no matter how big or small, are eligible for six weeks of paid leave. For workers at companies with more than 50 employees, it’s unquestionably welcome.
But for those who work at smaller firms in the state, it can create a difficult choice. Under federal law, workers at these firms do not enjoy leave protections. So while these employees are guaranteed paid leave for six weeks, they can’t be certain a job will be waiting for them at the end of their time off.
A study by Eileen Appelbaum of the left-leaning Center for Economic and Policy Research and Ruth Milkman of the City University of New York documented other challenges the California program faces, as well as its many positives.
The program reduces, but does not eliminate, inequities in access to paid leave. Low-income workers continue to report that they are less aware of the program, as well as more hesitant to take leave for risk of harming their relationships with their employers. They also say that receiving 55 percent of their salary while on leave — which is the California program’s level — is inadequate.
On the other hand, the research also shows that low-income workers say taking paid leave has a positive effect on their ability to care for a new child. The policy also encouraged these workers to return to their previous jobs after finishing leave.
Mothers on paid leave breastfed their babies for a longer duration. And fathers were more likely to take time off to bond with their new children. Employers, who had raised concerns about the proposal before it was enacted, had few complaints after several years of the policy being in place. It had little effect on well-paid workers.
The researchers concluded: “It has substantially benefited the workers who utilize it, especially workers in low-quality jobs, and has had minimal impact on businesses."
At its summit Monday, White House officials are planning to highlight findings like these. Obama may not support a federal leave benefit in his tenure, but he seems to be setting the stage for future Democratic candidates to do so.
“I think, eventually, it should be” a national policy, Hillary Clinton said last week on CNN. But, she added, “I don’t think, politically, we could get it now.”