Why America Needs Grandparents To Save the Birthrate

there's a melancholy surrounding pro-natalists

the author’s grandparents

Growing up in Mississippi in the 1990s felt like having a foot in both the modern and premodern worlds. I watched Nickelodeon in a town where the high school still crowned separate Black and White homecoming courts. The goods and ills of modernity slowly leaked into our community, but not all at the same pace.

Before I started school, my mother—college-educated, working full-time, newly divorced—was a textbook Clinton-era single mom. But even if she had the money (which she did not), we lived in a rural area outside a town with a population of less than 200, meaning we were a long way away from the conveniences—well-run daycares and pre-K programs—that allowed women to enter the workforce in full, with or without a partner.

The slack got picked up by her parents. In my early years, they were our sole source of childcare while my mom worked during the day and attended grad school in the evenings. For most of my childhood, we either lived in a trailer just down the road from their cattle farm or with them—for two years while I was in elementary school, they shared their three bedroom, 1900-sq ft home with my mom and her four children while my new stepdad was deployed overseas.

My grandparents taught me how to read and how to ride a bike. They raised me as much—if not more—than my actual parents did. A few times a year, I will say something to my wife that makes her look at me like I am an alien, and only then will I realize that a piece of my vocabulary or a cultural reference I thought universal belongs more to Depression-era Bassfield, Mississippi than the modern United States; I can thank my grandparents for these moments.

Today, there is a melancholy surrounding the pro-natalist policy community. While declining birth rates are clearly a disaster—for the welfare state, for economic growth, for innovation, and for the eudaimonia of the populations themselves—no magic bullet policy solutions have emerged. Countries as diverse as Sweden, Hungary, Italy, Japan, and South Korea have spent billions on childcare initiatives, family leave policies, and even preferential treatment for large families built into the tax code, with minimal to no success.

One issue may be that pro-natalist policy simply will not succeed if it is solely aimed at the nuclear family as currently constituted. A policy regime that prioritizes independence over interdependence is one that will always struggle to reproduce itself. What is required instead is a cultural change that expands the net of people who feel responsibility to provide for children, with the most obvious first targets being those closest to the children—their grandparents.

Encouragingly, there do exist policy levers that could incentivize grandparents to fork out more of their cash (if they cannot give their time) to the expenses of raising children.

The reason this is important is that income levels and ideal times for family formation—particularly if one plans to have multiple children—do not line up well. The median 25 year old in the United States makes roughly $45,000 per year, while the median 35 year old makes $61,500 per year—a 37% increase in real wages over a ten year period. Neither of those numbers is great considering the average family spends over $11,000 per year on childcare, but certainly, 35 year olds are more equipped to tackle the expenses associated with early childhood. But if your goal is to have two or three or four children, it is much easier if you have your first at 25 rather than 35.

But income is only half the story, as household net worth rises even more dramatically over time. The median person under 35 has a net worth of $39,000; for 35-44 year olds, that has risen to $91,000; and by age 60, it climbs to $212,500.

Given this, it makes sense to shift the cultural expectation of who will provide childcare costs, at least to some extent, from the (young, early career) parent to the (older, late career) grandparent.

One obvious way to do this at a governmental level is to use the policy levers currently in place, beginning with 529 plans.

529 plans are tax-advantaged investment accounts, created under IRC § 529 and sponsored by a state or educational institution, whose sole purpose is to help families save—and spend—money for education. Originally designed as college savings plans specifically, the law has been updated to allow up to $10,000 per year to go toward K-12 tuition and the “One, Big, Beautiful” spending bill currently on the table would expand it further to allow spending on homeschooling materials. But childcare before K-12 is not included as an allowable expense.

The first change would be to allow parents to spend 529 dollars on childcare expenses, a simple fix in the law. But we could also allow the beneficiaries of 529’s—the children themselves—to rollover any leftover funds in the accounts to their own children. If, because of the added expense, policymakers did not want to further expand the definition of allowable spending for 529s, creating these rollover Dependent-Care FSAs or new “Child-Care Savings Accounts” would provide incentives for new parents to begin thinking not just about providing for their children’s education, but for the generation that comes after that.

Additional policy mechanisms could also be created—whether tax credits for grandparent-provided childcare or adjusting Social Security or retirement withdrawal rules to decrease the financial burden on those providing in-person care for their grandchildren—but these would be more immediate and likely much more expensive than simple changes to the 529 plan.

The hope is that these policy changes will help to effect cultural change, as well—to prove true the Daniel Patrick Moynihan idea that “culture is downstream of policy.”

The current cultural message sent out by the 529 program is one deeply ingrained in American culture—the end goal of childhood, and therefore of parenting, is a college education. The highest achievement of parenting in America currently is having one’s child attend a top university and graduate without debt.

I hope my daughter’s dreams for the good life include not just college and a career but building a family of her own. Indeed, if the America of 2050 has a birthrate at or near replacement—a bare minimum we should be striving towards—we will need to create a culture in which a parent’s responsibility to help his child achieve the good life does not end the moment she graduates from college—most of the good life, in fact, comes after that, and we need policies that align with this vision.

None of this exists far outside the realm of today’s American culture—my mother-in-law retired early and moved two hours to be closer to us when our daughter was born; she has been our sole source of childcare since my wife returned to work. This is not uncommon and may be on the rise, though in my anecdotal experience there is a large class divide here, with grandparents providing more childcare in working class families than in middle (or certainly upper middle) class milieus.

The class distinction here is important. Changing the structure of our current 529 policy is not a broad social welfare giveaway; the people using this program typically land on the higher on the income ladder. But rather than being a drawback, the somewhat regressive nature of the plan makes sense if the ultimate goal is creating a culture where more people have (more) kids. Cultural change happens from the top down, and today’s signifiers of upper-class status become tomorrow’s moral imperatives.

If we can instantiate in America’s bourgeoisie a belief that childcare is in large part a responsibility of grandparents, that is significantly likelier to stick in the American ethos than whatever cultural change would be created by a commiserate increase federal funding for pre-K programs that go unused by our educated classes.