The Washington PostDemocracy Dies in Darkness

Hungary’s Orban wants to reverse his country’s shrinking population through tax breaks. That’s much easier said than done.

Hungarian Prime Minister Viktor Orban delivers his annual state of the nation speech in Budapest on Sunday. (Bernadett Szabo/Reuters)
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Declining birthrates are a concern for governments around the world. Some have come up with inventive measures to encourage people to have children: Russian women were once offered the potential of winning a fridge if they had a child, for example.

But countries need to tread carefully when implementing pro-procreation policies. Some evidence suggests many incentives can barely move the needle on birthrate and may represent a poor return on investment. At worse, they may be actively counterproductive and have disastrous knock-on effects.

The latest example of a remarkable pro-procreation government policy came just this week as the Hungarian government unveiled measures to bolster the country’s fertility rate. The fertility rate sits at 1.45 children per woman, well below the roughly 2.1 needed to maintain a population. The plan offers considerable economic incentives to have babies: For example, any woman who has four children or more would not have to pay income tax.

Hungarian Prime Minister Viktor Orban, a conservative firebrand, said the policy stood in contrast to that of other nations that used immigration to combat decline in their populations. Under his plan, Hungarian women would have more babies. “Instead of just numbers, we want Hungarian children,” Orban said at an event Sunday. “Migration for us is surrender.”

Some experts disagree. Tomas Sobotka of the Vienna Institute of Demography said he doubts the policies outlined by Orban will add anything more than a short-term bump to Hungary’s fertility rate. “Some of them are likely to be outright ineffective,” Sobotka said.

Even when countries manage to turn around their fertility rates, demographic problems aren’t necessarily solved. The country of Georgia managed to increase its fertility rate after years of post-Soviet decline, but its population is still shrinking.

Orban, who got his start in Hungarian politics as an anti-communist activist, would know how pro-procreation policies can backfire. In 1966, under the communist dictatorship of Nicolae Ceausescu, neighboring Romania implemented one of history’s strictest pronatalist policies. Abortion, once relatively widespread in the country, was banned, and a “celibacy tax” was imposed on any women who did not have children by the age of 45.

Ceausescu’s aim was to stem the decline in Romania’s fertility rate that had been caused by a number of shifting societal factors, including the growing role of women in the workforce. He hoped to increase the country’s population from under 20 million to 30 million by the year 2000.

The plan was a disastrous failure. According to estimates published by the World Bank, Romania had a population of 22.4 million in 2000. Since then, it has shrunk further, hitting 19.6 million in 2017. Ceausescu wanted Romania’s population to be five times that of its neighbors’ populations, but it ended up barely higher than in countries where abortion was common.

The human cost of the plan became fully apparent on the international stage when the program ended with the collapse of communism. “Ceausescu’s obsessive campaign resulted in increasing numbers of orphans, an infant mortality rate higher than anywhere else in Europe and the deaths of thousands of women who attempted illegal abortions each year,” Michael Dobbs wrote for The Washington Post in January 1990.

For the next decade, Romania was near synonymous with orphanages, prompting a wave of international attention that saw some U.S. families step in to adopt those without parents. Whatever boost was supplied by Ceausescu’s policies soon evaporated; by some estimates, the country’s birthrate is lower than it was in 1965. “This policy was only half-effective in the 1970s and 1980s, when the birthrate generally resumed its downward trend, and collapsed after the regime change in 1989, when abortion was made legal,” Sobotka said.

Orban isn’t quite following in Ceausescu’s footsteps. The Romanian leader’s vision was “extreme in its measure and scope and wouldn’t be easily replicated in any democratic country,” Sobotka noted. Abortion restrictions are not central to the Hungarian leader’s program for promoting procreation (although a number of Eastern European countries have taken a harder stance on the practice in recent years).

Instead, Orban tries to put a more radical, anti-immigrant spin on the sort of pro-child policies already popular in other countries — a mixture of cash benefits, tax breaks, housing provisions and more. The evidence that these tactics can work is mixed; often, the details of exactly how the policies are implemented seem to matter a lot.

“Pronatalist policies have been pursued in more than a dozen countries but the effects on fertility rates have not been large,” the authors of one recent study in the Lancet journal observed.

Notably, some of the policies Orban announced Sunday had actually been in practice in Hungary for years. Several conservative outlets have already proclaimed those measures a success. But a closer reading of them suggests a less clear effect. “Hungary’s fertility rates are still extremely low: only about 1.5 children per woman,” Lyman Stone of the Institute for Family Studies wrote last year.

This has come at a considerable cost: In 2013, Hungary was already one of the top spenders in the Organization for Economic Cooperation and Development in terms of expenditures on family support. “The government is spending huge amounts of money and will probably never reach replacement-rate with this strategy,” Stone wrote. The policies will only add to those costs, which in turn could ultimately imperil the incentives Orban is promising.

Orban’s bigger problem could ultimately be migration, rather than fertility rates. Although Orban is a well-known critic of immigration and has refused to take in European Union migrants, he should perhaps be more worried by high levels of emigration among Hungarians: Close to a million citizens are estimated to have left since 2006, with only a few hundred thousand returning so far.

“Until [young Hungarians] start feeling that they have a sound future in their own country, the Hungarian government may continue in their pronatalist frenzy without actually changing much in the country’s overall population trend,” Sobotka said.

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