Married people tend to be wealthier – so why give them tax breaks?
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Version 0 of 1. Marriage can help reduce economic inequality when it serves as a vehicle for people to cross class boundaries. But if wealth marries wealth, as it often does, it serves as a mechanism to accumulate capital and redistribute it upward. That’s just one reason why the state subsidization of marriage in the United States makes so little sense. Conservatives often say that married couples and their children fare better than their counterparts in a variety of measures – and thus the US government should continue to promote marriage. As Senator Marco Rubio put it, marriage is “the greatest tool to lift children and families from poverty”. But is it? In the United States today, marriage serves primarily as a mechanism for upward distribution of wealth. Since the 1960s, there has been a rise in the number of individuals who marry people with similar educational and economic backgrounds (a phenomenon called “assortative mating”). The percentage of college graduates who marry other college graduates has doubled since then. Related: Marriage is a leap of faith and a journey, not a statistical strategy game | Jessica Valenti While this makes sense, considering the fact that few women had degrees before the 1960s, the problem is that this kind of mating entrenches non-mobility between economic classes. More troubling, another study documents a strong correlation between parental wealth and marriage patterns, finding that individuals are more likely to marry spouses whose parents have wealth similar to that of their own parents. These studies indicate a growing concentration of wealth through marriage, resulting in more economic disparity throughout society. Compounding these trends, marriage rates in poor communities have declined significantly since the 1970s. For instance, in the bottom 25th percentile of earnings, half of the men are married, compared with 86% in 1970. The less educated are also more likely to divorce than couples with wealth and education. That’s why one commentator recently declared: “marriage has recently become a capstone for the privileged class”. If marriage is increasingly the preserve of those who are already better off, we should stop attaching many benefits to the institution. Beyond the issue of marriage as a mechanism for amassing and retaining wealth within a certain segment of the population, marriage’s economic incentives often profit those who are already better off. Related: Myth: the young have turned their backs on marriage The US government is taking very small steps in the right direction. President Obama’s budget deal, signed into law on 2 November, for example, eliminates a social security filing strategy that allowed (typically) upper-middle-class married couples to claim up to $50,000 extra in benefits – a massive tax saving that was not an option for unmarried people. The social security loophole is only one of many benefits that profit those who are already better off. Others include tax and estate laws that exempt married couples from estate and gift taxes or lower estate tax liability; tax breaks from capital gains when selling a house, which double for married couples; the income tax “marriage benefit”, which favors unequal earners when one is the main breadwinner over couples with two relatively low earned incomes. Some of these benefits attendant to marriage cannot be claimed to promote marriage among the poor and working class, as they rarely own property. And, in any event, studies consistently indicate that lack of wealth is a motivation not to get married. Related: Marriage problems: more than a third of people are single or have never married Will people stop marrying if the state stops subsidizing marriage? While such a change might have an effect on the motivation to marry, I doubt if it will be significant. Marriage comes with many other benefits: medical benefits (such as adding a spouse to employer-provided health insurance), decision-making rights (such as health directive) and financial obligations between the spouses upon divorce, such as spousal support and equal division of property. And there are well-known social and health benefits to getting married too. While the United States is extending marriage rights to those heretofore excluded from them, it is a unique time in history to rethink government subsidies for marriage. Debates about wealth inequality permeate mainstream discussion, yet wealth inequality continues to grow. Instead of enabling redistribution upward by subsidizing marriage, the state should remove some of the benefits attached to marriage, particularly those that profit the couples who are already better off, and give them to those who need them the most. |