The Free-Market Family by Maxine Eichner

The Free-Market Family: How the Market Crushed the American Dream (and How It Can Be Restored)
by Maxine Eichner
Oxford University Press, 2020

Over the past several decades economic policy in the United States has been run by libertarians. At least that’s what Maxine Eichner would have you believe in her new book The Free-Market Family: How the Market Crushed the American Dream (and How It Can Be Restored). In this provocative and nearly dystopian book we are told that “in the past half-century. . .the American Dream has come to be interpreted as simply guaranteeing the right to compete for wealth in an ever more brutal market.” Ah yes, the “brutal market.” This book drips with derision for “policymakers’ laissez-faire regulation of the economy,” and “our free-market system,” our “free-market mania,” with its “harsh market forces.” And if you’re wondering, free-market policy is contrasted “with another model of the government’s relationship to families” called “pro-family policy.” Who could oppose that? In other words, the book is a real slam-dunk on a tired straw man.

In one chapter comparing what children receive under free-market policy versus pro-family policy we are provided with updates, “The score: pro-family policy 2; free-market policy 0.” There is nothing inherently wrong with using strong language or being sarcastic, but too often the intensity of the language isn't commensurate with the strength of her arguments. Let’s just take one example, Eichner writes:

Young families in the United States today simply can’t afford the cost of good daycare. According to the US government, for childcare to be affordable, it should cost 7 percent or less of parents’ income. At the 2016 median household income of $59,000, that means a family should spend about $4,100 a year. Yet center-based daycare for toddlers in the United States costs on average $8,900 a year – about the same as in-state college tuition.

Not only is it expensive,

the absence of serious government oversight is also a problem. Decades of research have helped to determine what caregiver-child ratios, education, and experience serve children best. Finland and Denmark use that research to set quality standards. The United States doesn’t, expecting the market to sort out quality. But it turns out that the market doesn’t perform this task well.

But the study she cites also indicates that for center-based infant care, child care costs in Mississippi were 26% of income for families at the poverty level, and 99% of income in Massachusetts. That’s quite a lot of variation. In fact, you don’t have to spend that much time with the regulations for Massachusetts to see why. This is true in other higher cost states as well. For example, in Pennsylvania a child care director must have a bachelor’s degree with 1-2 years of experience (or an associate’s degree with 3-4 years of experience), and when more than 45 children are enrolled, an additional supervisor must be present who also has a college education. So, there may be an absence of serious oversight, but there is far from an absence of oversight. This, among piles of other state regulations, leads us to wonder: where is this free market Eichner inveighs against?

Now what are the pro-family government policies? Well, we’re provided quite a list at the end of the book: public investment in daycare and prekindergarten programs, limiting economic inequality and insecurity (that’s quite a lot), establishing a strong safety net, a variety of additional labor market regulations, and government programs for family planning, paid parental leave, child benefits, and home visitations. Under these policy proposals what state intervention couldn’t be justified? And under the name “pro-family policy,” who could oppose it?

And what about more libertarian concerns? Consider education, there is a massive homeschooling market in the United States stemming in part from what the government has done with public schools. Might these policies extend the problem into prekindergarten and childcare? Isn’t this entire program a continuation of the invasion into the private sphere by the government?

We need to move away from thinking that the goal of the economy is to expand markets, and to focus attention on what the real purpose of the economy should be: ensuring that all Americans have the resources to thrive. When we do this, we’re really asking: “How can we make the American Dream a reality for every adult and child?” And once we ask this question, the importance of two other parts of the economy besides markets become clear: the family, and the government.

Sure sounds like it.

There is an attempt to answer this at the end of the book when Maxine Eichner asks: “Was [Milton] Friedman right? Would pro-family policy reduce individual freedom.” Unfortunately, she doesn’t really answer the question. Instead we’re informed about “equating of markets with freedom,” and are told the “idea that citizens’ market decisions represent pure, uncomplicated ‘free choice’ also ignores the way that government action affects our choices.” Then we get a neat segue into asking, “How can government regulation of the market increase our freedom rather than limit it?” But these misunderstandings, and one statement in particular, make it clear she’s missing something:

Americans can certainly exercise the freedom of choice that exists within these market constraints, but we shouldn’t ignore the fact that many would prefer a different range of choices about how to live our lives than the market makes available to us.

This of course does not refute Friedman, because even by the most modest and unresolved libertarian’s standards we do not live in a free market, and there are good reasons to believe the limitations on choice, not to mention wealth, are the products of intervention. But the main point is not that people within a market like all of their choices, but that they have choices at all. Ends can be sought after privately or politically, The Free-Market Family: How the Market Crushed the American Dream (and How It Can Be Restored) calls for a massive expansion of the political means, and, yes, that reduces freedom.

—David Murphy holds a Masters of Finance from the University of Minnesota.