Babies are not bad for business

The Wall Street Journal recently pointed out how abortion-related proposals have been popping up at annual meetings of publicly traded corporations this year. Investors have seen such abortion-positive proposals at Walmart, Lowe’s, and T.J. Maxx. The proposals come from different shareholder groups, but each is associated with what is called ESG (environmental, social, and governance) investing, and each of the proposals advances the same flawed line of reasoning: Abortion is good for business.

“Women who cannot access abortion are three times more likely to leave the workforce than women who were able to access abortion when needed,” an ESG group, Clean Asset Yield, argued to Walmart. It cited a think-tank claim “that state-level abortion restrictions annually keep more than 500,000 women aged 15 to 44 out of the workforce.” The logic of the argument is this: When women don’t have access to “reproductive healthcare,” they might have babies, and if they have babies, they might stay home to take care of them, and if they do that, they won’t be coming to work.

That way of thinking might be ludicrous, but it’s hard to blame financial activists for sounding like the highest-ranking financial official in the nation, Treasury Secretary Janet Yellen, who told Congress, “Roe v. Wade and access to reproductive healthcare including abortion helped lead to increased labor force participation.” When challenged by Republicans, Yellen doubled down: “In many cases, abortions are of teenage women, particularly low-income and often black, who aren’t in a position to be able to care for children. … So there is a spillover into labor force participation.”

Secretary Yellen’s reasoning is grotesque. You don’t end a person’s whole life because they require some care at the beginning of it. Yes, from birth to about age 18, humans are dependent. We don’t fend for ourselves like wild animals from early on. Caring for human life is an end in itself, not the means to an end. We don’t feed babies because someday in the future they will join the workforce. We provide for them because they are human beings, and we are supposed to act like human beings ourselves. If the right to live is contingent on economic output, we would kill people at their retirement parties. Of course, we don’t do that because retirees are “super voters,” but unborn babies are voiceless. The argument advanced by Yellen and her cobelligerents in the ESG industry is helping economics live down to its moniker “the dismal science.”

And the math is dodgy, too. Who cares about the labor participation rate? Why does the rate matter? The point is to have enough workers to do the work, not to conform to some artificially imposed ratio.

This error is called the “base rate fallacy.” It ignores the central issue of whether there are enough people to do the work and focuses on a side issue, the ratio of active workers at any given time to possible workers. You can’t add to the labor force by wiping out more than 60 million people on the justification that a subdivision of the female segment of the labor force might have babies and some of those women might spend a few years at home to raise them. So, yes, motherhood decreases the labor participation rate, but abortion decreases the base, which is much more critical.

From an economic point of view, if there are enough workers, there is no economic problem. But abortion decreases the number of workers, period. Protecting the unborn probably does lower the participation rate because women do drop out of the labor force to raise children, but that’s a good thing, not a bad thing. It would be good if our culture and our leaders began talking like it was a good thing for women to be mothers, too.

A moment of common sense tells us that a child born instead of aborted likely leads to a lifetime of productive labor and only “costs” (to put it in crass terms) a few years of maternal care. Abortion eliminates the cost of dependency that lasts from birth to age 18 but also the productivity that comes from the ensuing 18 to 65 years. So, the argument is not just morally repugnant but economically and mathematically incoherent. Worldwide, the problem is not that we have too many babies, but too few.

It’s hard to imagine our managerial elite being more out of touch with reality. Can they actually believe that more family formation would be bad for Lowe’s home improvement stores? Do they seriously believe that more births would be bad for Walmart? If any of them ever actually shopped there, they’d see the moms and dads shopping with and for their kids.

Every worker and every manager and every supplier and every customer, indeed all of the “stakeholders” at one point, lived in a human womb, and all business depends upon them coming safely out of one.