Something Important about Rick Santorum

MEGADETH endorses him!



No, not that.

Actually, the news story that I found most striking today was this description of his economic plan.  Now, his plan is interesting to me because it does several things that are outside the usual playbooks for either party:
[In addition to cutting spending by $5T in five years he wants to flatten the tax code...]  
His plan would also likely mean a cut for many of the tens of millions of households making between $17,400 and around $50,000. They'd presumably fall into the 10 percent bracket, down from the 15 percent rate they currently pay. In keeping with his traditional views on social issues, Santorum also wants to encourage family formation (he and his wife have six children themselves), by tripling the personal deduction for each child, and by scrapping marriage tax penalties. 
Unlike Mitt Romney, Santorum has said he opposes a rise in the minimum wage, although he wouldn't scrap the concept altogether, as some in his party would. As well as auditing the Fed, he'd have it focus only on controlling inflation, and not on promoting employment. Santorum supports Rep. Paul Ryan's plan to save money by transforming Medicare into a system of private insurance. And like every 2012 Republican presidential candidate current or former, he'd repeal President Obama's health-care law. 
So far, that's a plan that sticks pretty closely to the standard GOP script. But other aspects of Santorum's proposal set him apart from his party, by grappling with issues of concern to Americans further down the economic spectrum. 
Again like most of his GOP rivals, Santorum would lower the corporate tax rate. But he'd establish two new rates: 17.5 percent -- a 50 percent cut from the current 35 percent rate -- for most businesses, and zero for manufacturers. The goal, his website says, is to "multiply job opportunities for struggling middle-income families and renew communities that have lost critical manufacturing jobs." 
In campaign appearances and debate performances, Santorum has often appeared eager to reinforce that focus on restoring middle-class jobs -- implicitly bucking the standard Republican line that derides issues of economic inequality and mobility as class warfare. 
"We need to talk about income mobility," he implored his party at a Republican debate on economic issues in November, noting the sky-high jobless rate for Americans without college degrees. "We need to talk about people at the bottom of the income scale being able to get necessary skills and rise so they can support themselves and a family."  
By the same token, Santorum hasn't shied away from mentioning poverty. "I don't believe that poverty is a permanent condition," he declares in the plan. "How do we effectively address poverty in rural and urban America? We promote jobs, marriage, quality education and access to capital and embrace the supports of civil society."
Now, since we're in the middle of a bruising primary battle, let's assume that whomever the final nominee happens to be will adopt the best ideas out of all the competing plans to take forward to the general election. What are the best ideas here? What might need to go?  What do other candidates have that you'd like to see added to the final plan?  For example, do you like minimum wage increases, or do you prefer to avoid them, or would you like to see the minimum wage discarded entirely?

Do you like the concept of fighting poverty by promoting marriage -- we've often seen good evidence that getting and staying married is among the most crucial factors in staying out of poverty.  Will increasing the incentives for marriage cut poverty?

What about the tax benefit for kids?  It appears he is proposing a deduction increase that can only answer to your actual liability, rather than an increase in the Child Tax Credit that (like the EITC) it can bring a "refund" even though you didn't pay the taxes in actual dollars.  At the lower end this might move some families off welfare; although some on the right regard the EITC-type plan as a form of welfare, since it results in transfer payments to poorer families.

I don't think I agree, though, because families raising children is what produces the best and most successful citizens, who will go on to pay taxes in the future.  It is therefore a kind of public good, in that all of us reap the benefits whether or not we pay into it (at least, all of us who live long enough to go on Medicare, or drive on the highways).  It's something we might reasonably support, not out of charity, but because it's the right thing to do, and because -- like making sure children are educated -- it works to the benefit of all of us.

Anyway, it's an interesting set of proposals.  What ideas did other candidates have you'd like to see added? Which of these ideas do you not like, and why?

27 comments:

douglas said...

I'd have to disagree on your assessment of "families raising children is what produces the best and most successful citizens"- well, at least as a blanket statment: Welfare moms are the perfect example of where that is not true. Those who get paid to have children (as opposed to paying less taxes for having children) tend to not raise those children in the best environments to promote success and excellence.

I think the manufacturers exception is innovative and could really carry a large section of moderate working class voters- but then, I have to ask myself if it's then a pander of sorts- I think not, I believe it's wise to maintain a wide manufacturing base, and we've been narrowing that industrial base (though we still manufacture plenty). When we narrow that range of manufacturing, we start to lose the institutional memory of how those sorts of things get done- that's worth preserving in a way such as this.

Grim said...

Douglas:

There may be a problem with women who have children specifically to ensure welfare payments; obviously my preference for a tax credit would make that a greater danger than Santorum's preference for a deduction. On the other hand, my policy might push them off welfare-as-such, whereas his will do nothing for a family already poor enough to pay no income taxes (which is where most of those families are).

Whether that's bad or good depends, I guess, on where you fall in terms of wanting that kind of family to exist under direct government supervision, and as government wards. It might be good for the mother; I'm not sure it's good for the kids to grow up thinking that's normal.

DL Sly said...

I don't know, Douglas. I'd have to say as a blanket statement, "families raising children is what produces the best and most successful citizens", is fairly accurate given that it's an accepted standard that welfare moms raising several children alone are not the *family* that the statement is referencing. Are they families? Of course they are! However, wrt pretty much every study/poll conducted by both government and private entitities, the *family* is always considered to consist of two parents -- usually a man and a woman, but in recent times such distinctions have been blurred. All other arrangements are categorized into one of many qualifying descriptors: broken, dysfunctional, etc. These studies have also shown that, in the general aggregate, such *families* tend to produce children that are more likely to perpetuate the welfare cycle. Whereas the traditional nuclear family has been shown to consistently produce "...the best and most successful citizens."

Texan99 said...

Families raising children are great in all kinds of ways, including the economy. We shouldn't use the tax code to provide incentives, though. I'd prefer as flat a tax code as possible. Ditto corporate taxes. There's no good reason to tax corporations at all, but if we're going to tax them, the government shouldn't be in the business of deciding which ones are the "good" ones. Lower the tax burden on everyone, and let the jobs flow from the ones that are competing effectively, whether that's manufacturing or something else. You can't prop up losing manufacturing businesses by favoring them with the tax code, even if you wish high-paying jobs were easier to come by for people with no education.

It's a shame even the GOP candidates are addicted to government as social engineering, even if their ideas of social engineering are more agreeable to me that those of Democrats. We have fine private institutions and processes to produce prosperity and mobility. Government should be for the things that must be collectivized or mandated, like national defense and some kinds of public safety and order. Well, that and making sure that pre-schoolers don't eat turkey sandwiches.

Cass said...

It's a shame even the GOP candidates are addicted to government as social engineering, even if their ideas of social engineering are more agreeable to me that those of Democrats.

I agree, and this was my concern about the whole Santorum video the other day. He clearly wants to see reich wing social engineering.

I am not sure how I feel about that but am suspicious of it on general principles. I don't trust Republican politicians to know what's best for us any more than I do liberal ones.

Anonymous said...

I would leave a token tax on manufacturers for the purely political reason that that way the Repubs have some shield against the inevitable charge that "manufacturers are not paying their fair share!! Whah!" I would also scale back, as in reduce, the federal minimum wage. If states and localities want it higher then that is great, but back off on the fed rate. I'm not thrilled about a per-child tax credit but I am 100% in favor of removing the marriage penalty.

If the feds are going to social engineer, then perhaps the better way would be to undo the changes made in the 1960s that began favoring unwed mothers. No new legislation would be necessary, although someone would have to do a great deal of careful research to see what needed to be repealed, layer by layer and thread by thread.

LittleRed1

Grim said...

I'm not opposed to the government being structured to support private institutions that we agree are of great benefit. We've often spoken of the Yeoman farmer concept of Jefferson's, and how that translates to a large degree to a modern small business owner (or small farmer): because they own their own means of production, they are manifestly freer than if they depend on someone else for a paycheck. (Of course, the small business owner depends on 'someone else' in the sense of his customers, but it is not one person who can fire him if he doesn't show the right political spirit, or argues against a favored candidate at a town hall meeting.)

Since the American ideal is to create and defend a space for a free people, I see no reason why we might not sometimes defend that space by favoring ways of making a living that support a freer way of life.

The family and child tax issues are a different case. Families that care for their own children are doing something we need to have done in order to produce the next generation of citizens (and, as Sly says, they do it better on average). Since they're creating a common good, I see no reason not to take that into account in terms of determining what their 'fair share' of the tax burden is. You might say they're paying part of their taxes in kind, by providing a service that is good for all of us (as well as, of course, doing something that is a good for them in itself).

In any case, I'm not wholly opposed to the idea of government acting to support ways of life that are manifest goods. Supporting family formation seems like a common good, while supporting small business (not necessarily manufacturing, but certainly including manufacturing) seems like a way of creating opportunities for people to live freer lives.

Grim said...

Now, on the other hand, I do oppose the government trying to stick its hand inside those private structures. Insofar as we create a space for an opportunity -- say, by providing a child tax credit to offset part of the expense of having another child -- that's one thing. The choice is still your own.

Insofar as the government is using taxes to force you to have a child, or not to have a child, that's another.

Elise said...

I agree that social engineering in the tax code is social engineering in the tax code regardless of whether I like what's being engineered or not. If we as a country want to reward people monetarily for having children, let’s just mail them checks.

Having different corporate tax rates for different industries is just another form of having the government pick winners and losers.

As for the marriage penalty, I think each person should get taxed based on his or her own income, period.

I don’t want a Federal minimum wage. If a State with lots of employment opportunities wants one, great; if a State without a lot of employment opportunities doesn’t want one, fine. But I don’t think employers in job-poor States should be forced to pay the same minimum wage as employers in job-rich States. That looks to me like a variant of the barriers to entry idea for corporations.

Grim said...

It is a form of having government pick winners and losers, yes; I only think it should be done in cases where we have a pretty solid national consensus that there are things we want to win. Children are one of those things that, even if the market doesn't currently favor them, we are still going to need. If it takes government action to help them "win," I'd rather that than to have them lose.

So, in other words, I agree with your general principle -- but with some specific reservations.

Hillary Clinton Redux said...

If we as a country want to reward people monetarily for having children, let’s just mail them checks.

Hey Elise, I am totally down with that.

Elise said...

So, in other words, I agree with your general principle -- but with some specific reservations.

Sure, there are deductions I like, too. But the problem is that everyone has specific reservations regarding deductions they like - deductions for mortgage interest; deductions for charitable giving; deductions for medical expenses; deductions for retirment savings - and it’s always easy to accommodate “just this one” reservation. As with spending, the people arguing for the deduction have good reasons, laserlike focus, and great passion; the people opposing the deduction usually don’t. So this deduction passes into law and then that deduction and then another deduction. In the end, we’ll be right back where we are now: with a tax code that looks like something the cat coughed up in the corner.

Grim said...

That's not quite the general principle I meant. :) You can just mail them checks if you prefer; I don't really care if you use the tax code or not.

I meant the principle: "Government should not pick winners and losers."

I agree that, most of the time, it should not. Most of the time, that leads to corruption and a vast rat's nest of bad policy. Conservatives generally trust the market to make better decisions, and we tend to believe it is fairer to let a thing succeed or fail on its merits in the marketplace. Government 'picking the winners and losers' in this sense is thus morally wrong in itself, in addition to the fact that it leads to ills.

However, there are some cases -- like children -- where we do need to pick winners. The market makes better decisions about most things, but it tends to react to immediate information. The market cares very much about current economic information, which might make it very hard for young families to start or have an extra child right now. The market doesn't care that, twenty years from now, we're going to need a new infusion of taxpayers and workers and all the other things we'll need. It also doesn't care that obtaining those as natural born citizens has some advantage over obtaining them by mass immigration.

(In addition to all the things they can do for us when they get old enough, of course, children are gifts and ends in themselves.)

So, there may be times when Americans do have a solid national consensus that we want to 'pick winners'; for example, we want to choose that our children should be winners. We do the best we can as individual families, and we do what we can through private charity; but, in these limited kinds of cases, I do think that passing a law or adjusting a regulation can also be an acceptable tool. A government act in this case can be OK, even though it does constitute an exception to a general principle that 'government shouldn't pick winners and losers.'

Texan99 said...

You know a good way for Americans to pick the winners and losers in business that they support via a national consensus? The free market. We usually call that the Republican Party platform.

Another way is for the government to take tax money from citizens and use it to reward the businesses that voters prefer by a majority (or that the bureaucrats appointed by the voters prefer by fiat). We usually call that the Democratic Party platform.

I'm not convinced that we make a better society by forcing people to subsidize each other. Anyone who wants to give money away or share it is free to do that: in families or otherwise. Anyone who wants to get money from someone who's not motivated by fellow feeling to give it as a gift probably ought to give value in exchange for it in a voluntary transaction.

Grim said...

Well, you can't insult me by calling me a Democrat, Tex. I was one for a very long time.

I think I just made your point about a preference for markets in my last post. However, notice that the example of children in particular doesn't work well with markets. Markets just aren't very good at this.

Let's say that we have a working family who wanted to 'exchange value' for the money they need to raise some kids. Well, they can't exchange money for it; that's what they're short on. One or both of the parents might be able to take a second job, but then when will they have time to raise the kids?

(For that matter, they probably can't both take second jobs; it may be hard for them to both take first jobs with a young kid, since you can't leave them alone and they may not be able to afford day care.)

Now, it benefits you and me that these kids get born, so they can pay for our Social Security (assuming it survives the Baby Boomers in some form); or failing that, so they can help us pay for the debt Obama is racking up now. So, there's some value to be had from the kids -- but they can't interact with the market we have now. They don't even exist now, and they won't be able to work for at least fifteen years.

The parents can't take out a loan against their kids' future labor, so that's not an option either.

These are some problems that markets aren't good at dealing with. A preference for market-based solutions is a praiseworthy one, but it's not going to answer every problem.

Cass is talking about marriage rates and childlessness rates among highly educated women over at her place today; the reason that they're in better shape than everyone else is because they have more value they can trade for money, which gives them greater freedom to have children. That's a great solution, but what about the working family that decided to have kids, say, four years ago? Dad had a great job in construction at the time, but that has now been gone for three and a half years. He's got time to help raise kids who would be good citizens and help haul the freight when they get a little older, but he can't afford the ones he's got. So his family stays small, and the kids suffer.

That's what things like the EITC and the Child Tax Credit are for. I don't think they're bad things -- even if it does mean, in a sense, that we're trying to pick a winner. I do want his kids to win out.

Texan99 said...

I know it's hard work to raise kids and find time to make money, too. Nevertheless, the answer for people who can't manage it isn't for other people to send them checks. People who want to raise kids ought to figure out for themselves whether it's important enough. They can always pass the hat among neighbors who might be inclined to subsidize them, but it strikes me as wrong for them to demand that the government drum up subsidies for them. I believe people ought to transact with each other by choice, not coercion. (I make exceptions, on the children's behalf, if they die or otherwise prove incapable of supporting their own children.)

My point about the Democratic Party wasn't to insult you, it was to make emphasize that this is a GOP primary. You're judging Santorum in large part by how much he appeals to your Democratic ideals. I believe that misses the point of what's most valuable and irreplaceable about the GOP's contribution to the debate. We don't need a second Democratic Party in this country.

Grim said...

It is a GOP primary, as you say. I notice, though, that we have frontrunners in that primary whose stated positions -- I mean Romney's and Santorum's -- are closer to this than to the principle you're holding up as the GOP standard.

There were flat tax advocates in the race, but they have not survived. As Cass and I were discussing yesterday at her place, there were candidates who were hot to disband the Department of Education -- as Gingrich and Paul still are, though neither is apt to win.

If the ideas lose within the GOP primary, that does not mean they are wrong ideas; but it may mean that they aren't the true ideals of the party.

In any case, what you describe as my Democratic ideals -- fairly enough, since they are Jeffersonian and Jacksonian ideals, and both men were important Democrats -- did once do good things for this country. From my perspective, the tragedy isn't that we might get 'a second Democratic party,' but that we no longer have the first one.

Grim said...

I rush to add that I am entirely in favor of disbanding the Department of Education, and forcing a very strict adherence to the 10th Amendment. (Strict Constructionism was one of Jacksonianism's most significant principles.)

I don't object to a flat tax; I just want to advance the idea that it can sometimes be OK to use even the government to support an end where there is a demonstrable common good, a broad consensus that the end is a worthy one, and where market solutions may be limited. So long, of course, as this support is done in a Constitutional way.

Still, I've finally admitted to myself that no one left in the Democratic party agrees with me on anything; and it may be worth admitting that few in the GOP agree with either you or me on most things. I think of myself as a member of the TEA Party now; perhaps that's your true party too. The GOP, at least, does not appear to be the party you believe it is: not if we judge their actions, including the actions of their voters.

Elise said...

That's not quite the general principle I meant.

Oops, too bad. I wasted a nice little snit there.

I don’t agree with government “incenting” people to have kids (although if we must I certainly don’t want to do it via the tax code). I’d prefer that people make decisions like whether to have kids, buy houses, give to charity, save for retirement, and so on without consideration for whether the government is going to help them out financially. My American history is pretty shaky but I’m not aware of anything in particular that Jefferson and Jackson did to provide financial incentives for people to have children.

I’m in favor of a safety net for people who need it (like your example of family with children, breadwinner loses his/her job) but to me that’s a different thing than paying someone who has children regardless of circumstance.

Grim said...

(I might also add that I don't know if it's quite right to describe this proposal as "to demand that the government drum up subsidies for them." For one thing, it's Santorum proposing it, not the poor; for another, it's not 'drumming up a subsidy' for them, it's cutting their taxes. That's usually a good thing for the TEA Party, and it certainly isn't coercive.)

Grim said...

Elise:

The way the EITC works is that it cuts in only at low income levels, with qualifying children. Thus, it kind of is a safety net; it's not regardless of circumstance, it just automatically kicks in if you didn't earn a lot last year and you have kids.

Now, the Bush child tax credit is pretty much just about how many kids you have. So they're distinct in that regard.

Santorum isn't proposing either; he's just offering a higher deduction. Thus, if you don't earn enough to pay income taxes, the higher deduction isn't going to help you. I regard that as inferior to the EITC simply because it helps people who have both kids and higher incomes more than the ones who really may need the help to get their kids by.

douglas said...

But it isn't about getting by- that's what the safety net is for- it's about encouraging that there will be a production of a following generation to work, support their parents, and maintain the society. All the better if they're being raised in successful families.

The continuance of society is the primary function of that society, and since we no longer have widespread acceptance of religious ideals to promote that (in fact, the new ideal seems to be less children than will maintain current population), we need something.

Also, I'm starting to wonder when Republican started being equal to Libertarian- and I'm a libertarian leaning, Tea Party Republican. I wholeheartedly agree we've gotten way overboard on all this social engineering and picking winers and losers, but I'm not a free market purist or capital L Libertarian, I'm a Republican. Also, given the fact that we've got work ahead of us just to get Obama out of office, I don't think we're going to get a flat tax enacted anytime soon, so until then, we work within the system we have.

Grim said...

But it isn't about getting by- that's what the safety net is for- it's about encouraging that there will be a production of a following generation to work, support their parents, and maintain the society. All the better if they're being raised in successful families.

Well, Douglas, that's right. Proponents of the EITC usually point out that (because the EITC is only available to someone who earns enough to file taxes) the point of the thing is to keep people off the 'safety net' as such, by making sure that they aren't losing money by working v. being on welfare.

So the value you describe is there, and in a way it's not supposed to be a kind of welfare, but a way of encouraging work. Still, I think it may be OK to describe it as a sort of part of the safety net -- but in another way, you're right, it's not quite that either.

Maybe it's better (as Elise says) simply to mail people checks rather than to use the tax code. 'Guaranteed income' is one of those ideas I see floated once in a while. That sounds like it would produce perverse incentives to me, but I do respect Elise's reasoning about the ugliness and complexity of the code.

Texan99 said...

Playing favorites with the tax code is providing subsidies for those who pay more taxes in favor of those who pay less. The whole progressive tax code is one big subsidy, but why make it worse by cherry-picking even more winners and losers? The depressing truth is that governments (even democratically elected ones) are horrible at picking winners and losers -- much worse than the rough judgments imposed by a dispersed market. When they're allowed to do it, they wreck their economies and degrade even the prosperity of the segments of the population they hoped to bolster.

Grim, you're accurately describing the drift of the GOP; I'm describing what it needs to be in order to arrest an economic decline that will lead to decay and collapse a la Europe. My ideal may never happen. The GOP may follow the Democratic Party in its habit of buying votes from 51% of the public by promising them freebies financed by the 49%. I hope not, because the great virtue of letting the public decide things individually whenever possible is that you get input and trade-offs from the whole population instead of just from the 51% that can raid the 49% with impunity. That's what we're really doing when we let a "consensus" determine what worthy activities we're going to reward with "our" tax money. It leads to a stagnant economy and currency collapses. It may prove once and for all that democracies can't work long-term, because they have no mechanisms to arrest pandering once it gets well started.

Elise said...

... it's about encouraging that there will be a production of a following generation to work, support their parents, and maintain the society. [snip]
The continuance of society is the primary function of that society, and since we no longer have widespread acceptance of religious ideals to promote that (in fact, the new ideal seems to be less children than will maintain current population), we need something.


I have serious qualms about the idea that each generation must be larger than or even as large as the one before it. If it must be larger than then eventually we are simply going to run out of something; elbow room, if nothing else. As someone who prefers a less-crowded environment to a more-crowded one, I don’t look forward to that kind of world. Even if we want to keep up or increase population numbers, we don’t have to encourage people to have children to do that; we can simply encourage immigration. Which is sort of what we’re doing.

I’m not convinced that tax deductions for children really cause people to have children. Rather, as Grim puts it, it makes life easier for families who do. I don’t think that’s a bad thing but to me it properly belongs in an explicit safety net (welfare) program, tied to family size and income rather than to children explicitly.

At a more fundamental level, there’s a part of me that thinks if a society adopts a set of beliefs that will lead to its extinction, maybe that society should be extinct. Which could lead into a discussion about whether having the government “incent” something is equivalent to having a prevailing social consensus about something. I don’t think so but haven’t (and perhaps can’t) formulate an argument about why they’re so different. Although T99’s points about governments incompetence in picking winners and losers might apply here as well: using financial incentives to produce children is almost certainly not going to produce the same attitude toward children as does a societal consensus that children are, in and of themselves, a Very Good Thing.

As for why conservatives seem to be drifting libertarian, I suspect it’s because there have been one too many camel’s noses under the tent. After years of ending up with the whole camel (and the rest of the herd) taking up residence, even the most worthwhile government endeavors start to look like the start of yet another slippery slope - down which we, the camels, and the tents are all sliding willy-nilly.

Grim said...

Elise,

I think you could have a civilization whose population was 'as large or slightly smaller' without too much disruption; but there are real issues with a drastic falloff of fertility rates, such as we've seen in (for example) Western Europe, Japan and Russia or (by design) in China. The Chinese haven't hit the wall yet, but when they do, it's going to be a lesson for the ages.

Now, of course, this verges on the danger that Cassandra warned strongly against -- that of thinking of such matters as serious public concerns, rather than treating them as the private concerns that we might prefer. Certainly there are reasons to prefer privacy here -- and China's faults, in point of fact, come precisely from their decision to try to treat this as a fit subject for public policy.

So, I'm not making any special prescriptions. I'm just asserting that I think children are something it might be wise to support -- even taking on board your reasonable objection that incentives could distract us from having children just because we want them.

T99,

I completely agree with you on the virtues of the market, when it comes to the kinds of decisions we normally make. Almost everything falls in this category, and the market is a better way of adjudicating success and failure than central planning. I agree.

The reason, though, that markets are better than central planning is that market decisions have the advantage of more local information in real time. As a result, they are better able to sort allocation of resources, because they have more, and more current, information available.

However, the corollary to that fact -- that truth -- is that markets decide based on local, immediate information. The kinds of decisions that markets are least well placed to handle are decisions about ends that are well outside of market conditions -- that is, ends that are not immediate either in time or space. The more distant the ends, the less able the market is to bring its special advantage to bear.

You can witness this by going back on InTrade or any other market-based prediction system, and witnessing how much more inaccurate predictions become the more distantly they were made in time. This isn't a failure of the market, but it is a feature of the market. The market works so well because it leverages information advantageously in space and time. When you have to choose something at a very distant space or time (or both), you aren't going to get as good a result.

You may, in fact, get a rather worse result. The market will continue to insist on trying to predict the future based on current trends. That tendency is just what Orwell warns against as a kind of power-worship: the assumption that current trends will continue.

In these cases of long distant events, we are wiser to look for eternal guides instead of market guides. Faith, hope, and love will continue to be of value; and so, I trust, will children.

Texan99 said...

I'm in violent agreement that the market can lead to poor results when what we need is attention to factors that are distant in time or space, but that require a rapid and well-coordinated response. I'm not persuaded that central planning gives better answers; I'm aware of only a very few examples of when it has done so: war and epidemiology being my favorite poster children. So although markets aren't perfect, we aren't discussing replacing them with something perfect, we're discussing replacing them with something that to my mind has produced demonstrably worse results.

Elise is right, I think: organisms that don't reproduce soon cease to be a problem, for themselves or for anyone else. Other families will simply take their place. I advocate keeping the government out of the business of either interfering with or incentivizing reproduction. I think we get into the worst trouble when we restrict fertility by fiat (as in China) or encourage irresponsible fertility by subsidy (as in the U.S.). Procreation ought to be up to the parents and anyone they can voluntarily enlist in their support, which to my way of thinking does not include distant strangers who got outvoted -- not because the distant strangers can be assumed to hate children, but because procreation is an issue that ought to be addressed according to personal ties and duties. If a culture produces too many individuals who don't either procreate or support the procreation of those closest to them, it will die out and be replaced by another. I don't see how it can be kept on life-support by commissars who can artificially redirect societal resources to it via an impersonal top-down process.