The recent introduction of the Republican-led (Mike Lee, R – Utah, and Joni Ernst, R – Iowa) CRADLE Act would allow paid family leave to be taken from already earned Social Security benefits. And also, just before that, as part of the Administrations 2020 budget, a one-time one billion dollar fund to jump-start a proposed six-week paid federal family leave program was suggested by President Trump.
These proposals are intended to combat the Democrat’s Family Act, which was intended to set up a program of paid leave for familial and medical reasons, which would be funded by a new tax on the payroll for federal employees.
The problem with both of these different approaches is the same thing: expansion over time.
Like the first proposal, which won’t utilize any additional tax burden, which allows the employee the tap into their future Social Security benefits for leave at current. While Social Security already doesn’t take in as much as it puts out, adding in additional payouts would create a deficit that would have to be eventually addressed.
Though that doesn’t stop the issue of a comprehensive and sustainable paid family leave program from being discussed, some even going so far as to say the current plan isn’t even enough.
But the type and amount each leave would always be in question. People who need it will need it, and if they need more, then that discussion would have to be had too. And once borrowed, forcing a person to put off retirement just so they can pay back what they borrowed against, would be a bad PR move for any future lawmaker. While it comes off as a good proposal, over time, this could cost taxpayers and up to an extra $2000 a year. Adding to this that there are many paid family leave programs already available through employers, and more than a third of all working people in America would be eligible for such without adding in any additional and federal compensation.
As for the other two-thirds of people who do not have access to these employee sponsored plans? There are proposals in play, such as the Working Families Flexibility Act. This would allow employees to bank up additional paid leave through their hourly rates by allowing them to choose between paid time off and just getting pay. Other options too, like letting employees tap into future 401(k) penalty free, or things like universal savings accounts, could help to supplement paid family leave.
Paid leave is a complicated issue, and the people who propose solutions need to consider both the benefits of their proposals, but also the other side too.