Carly Fiorina Has A Laughable, Dangerous Solution To The Paid Leave Problem

You can't leave this stuff up to CEOs.

New mothers in the United States are often forced to go back to work just a few weeks after having babies. That happens because our federal government, unlike that of any other country in the developed world, offers no provision for paid maternity leave.

But no worries, everyone! Carly Fiorina has a solution. If the former Hewlett-Packard CEO is elected president, she’ll simply fix our economy, making it “so strong that employers are forced to compete for workers by offering better salaries, better leave policies, more time off, and good benefits,” she wrote on Thursday in a blog post for The Huffington Post.

This is a laughable and dangerous way to think about paid leave. One that’s sure to fail women in the United States, particularly those who aren’t lucky enough to work professional jobs at companies enlightened or profitable or large enough to offer paid maternity leave.

We've left paid leave up to businesses for too long, and what have they done? Right now only 12 percent of employees at privately owned companies have access to paid leave, according to the Department of Labor.

Allowing this to keep happening would do more harm to the economy than Fiorina seems to understand. And paying for federal mandated leave is far cheaper than she seems to realize -- even though her home state of California has been pulling it off for more than a decade.

But paid leave isn’t simply a matter of economics; it’s a public health issue that we all have an interest in.

“It’s clear that there are harmful effects to kids and mothers for not having leave,” Sharon Lerner, a senior fellow at Demos and a leading researcher on the topic, told me earlier this year.

When there’s no paid leave, women are less likely to breastfeed and to take their infants to pediatrician appointments, and there’s an increased likelihood of maternal depression, Lerner noted. “Paid leave actually has a life [or] death effect,” she wrote.

It’s worth emphasizing that paid leave isn’t some cushy perk for well-paid workers, like the free snacks and coffee HP's peers Google and Facebook provide.

Fiorina points out that when she led HP, from 1999 to her dismissal in 2005, the company offered generous benefits, “because we wanted to compete for the best workers.”

She also highlights Netflix’s recent announcement that it would offer up to 12 months paid leave to its workers. But she neglected to mention that Netflix’s entire DVD division isn’t getting the new benefits. And that is the crux of the problem with Fiorina’s plan.

When paid leave is thought of as an "extra" used by the country's biggest companies to attract in-demand workers, many less skilled, less well-paid workers -- hourly retail employees, for example -- get left out. You don’t need to be an economist to understand the implications. It means a wide swath of people -- new mothers responsible for taking care of the next generation of our country’s workers -- get no help. Many end up simply quitting their jobs. Some of those women wind up on food stamps and other government benefits. And guess what? Those benefits would cost more than federally mandated paid leave.

It would appear that Fiorina simply doesn’t understand that. In her blog post, she wrings her hands, wondering who would pay for federally mandated leave. Would we have to cut Social Security, she asks, in a comment I suppose is meant to strike fear in the hearts of seniors, who are more likely to vote Republican. 

Ultimately, she concludes, passing such a law would force employers to cut costs and create fewer jobs. It will slow down our economy, she declares. 

Here’s the reality: Workers can pay for family leave with just a tiny fraction of their paycheck. That’s how it has worked for the past 10 years in Fiorina’s home state of California, where workers get up to 55 percent of their pay for up to six weeks to bond with a new child or care for a seriously ill family member.

Under Fiorina’s line of thinking, California’s businesses must have been devastated after the law went into effect in 2004. Nope.

Actually, 89 percent of employers surveyed by the Center for Economic Policy Research in 2009 and 2010 reported the new law had either a positive effect or no effect at all on productivity. Ninety-one percent of the businesses surveyed said paid leave had no effect or a positive effect on profitability. A staggering 99 percent said the law had no effect or a positive effect on employee morale.

Fiorina notes that paid leave would particularly hurt small businesses. The analysis of California companies found that small businesses were less likely than larger ones to report negative effects.

The law was good for mothers, too. Low-income mothers, in particular, reported positive effects and the law doubled the median duration of breastfeeding for all new mothers who used it.

And what about those companies that already provide benefits? They saved money, said Eileen Appelbaum, a senior economist at the Center for Economic and Policy Research, who co-authored the study.

“Companies that can afford to offer paid maternity and paid family leave and choose to do [so] should be applauded. But no one except Carly Fiorina thinks that employers should be required to provide this,” she said. “Instead, what we need is a national program that spreads the costs of paid leave over the entire work force, making it cheap to provide, and covering every worker.”

Indeed, a bill called the Family Act is before Congress right now, and seeks to pay for federal mandated paid leave with a very small employee payroll contribution -- with employee and employer contributing two-tenths of 1 percent of pay to fund it. That small amount of money would give workers up to 12 weeks of partial income replacement.

The idea is to spread the cost of paid leave to everyone instead of foisting the burden only on the nation’s poorest women, who are the ones who suffer most from a lack of federally mandated leave.

“Carly Fiorina says government shouldn't tell business what to do. It's exactly the role of government to develop minimum standards to protect the health and well-being of its people,” said Ellen Bravo, executive director of nonprofit advocacy group Family Values @ Work. “Right now birth or illness for many families leads to debt, poverty or bankruptcy -- conditions which disrupt the economy."

 That's a scary problem, and one that's not up to our nation's private sector to solve.