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Information Is Conveyed by Dogs that Don’t Bark

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Here’s a letter to The Atlantic:

Editor:

Joe Pinsker does a good job reporting on the recent debate, sponsored by the Ethics and Public Policy Center and which I attended, on the merits of the conservative case for government action to increase paid family leave (“The Conservative Argument Over Paid Family Leave [2],” July 25).

I want, though, to flesh out one point mentioned by Pinsker that risks being unjustifiably scorned as flippant, which is this: Rachel Greszler’s suggestion that workers who want to take time off work to care for family members, but who don’t have employer-provided paid leave, might borrow from banks the funds to pay for such time off.

Debate-panelist Aparna Mathur – who supports government action to increase paid leave – dismissed Greszler’s suggestion by observing that banks don’t make such loans. But in doing so Mathur inadvertently conceded much of the case to those of us who oppose such government action.

The fact that there’s no category of such loans made today by banks likely implies that the demand for such loans is quite small. If so, this fact means that Greszler and the Mercatus Center’s Veronique de Rugy – the debaters who argued against government action to increase paid leave – are correct to insist that the market is not currently “failing” to supply an adequate amount of such leave.

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030

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