Reclaiming the Defensive in the "War on Women"

Women are free to choose the employers that are best for them, and women who prioritize free access to birth control can seek out institutions that offer that benefit. Then, employers would have an incentive to offer contraceptive coverage.
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Economists are not generally thought of as the most emotional of people. In social situations, this feature is usually a negative one, but in emotionally charged debates the lack of emotion can be quite beneficial. Take the birth-control debate, for instance.

Dear ladies: I really couldn't care less whether you use birth control or not. In addition, I couldn't care less whether either I or my employer subsidizes your birth control via insurance premiums. (For those of you who aren't aware, that's one part of the debate that people almost have right, as cross-subsidy is how insurance works. Also, for the record, I am, in fact, a woman.) What I do care about is women acting as victims rather than combatants in the supposed "war on women."

First thing first -- I am indifferent to subsidizing your birth control because, when I look at the numbers, it occurs to me that I am, via either direct or indirect insurance premiums, likely either going to pay for your birth control or your obstetrician. Consider the impact of a birth-control price increase on female college students:

In the sample as a whole, Collins and Hershbein found no significant change in the rate of accidental pregnancy. (On paper, the numbers increased by about 6 percent, but that variation is within the range that could be due to chance.) One logical explanation is that to some extent, the reduction in sexual activity canceled out the reduction in reliable contraception. But when Collins and Hershbein looked at the most financially stressed women -- those with more than $2,000 in credit card debt -- they found that the rate of accidental pregnancy among these women increased 23 percent.

It's entirely possible that the overall population of women could look more like the financially stressed group than the college student average, in which case it's more cost-effective to subsidize birth control than to subsidize the additional pregnancy care that results from people not using reliable birth control. But I digress.

The birth-control issue that has recently been debated is whether health insurers, and, by extension, companies that offer employee health insurance, should be forced to include birth control in the policy coverage. (Note that the issue isn't so much about "access" to birth control as it is about "free access" to birth control. Personally, I hate the use of the word "access" in this debate because I find it demeaning to things such as abortion that women really do have trouble getting access to.) The argument in favor of the requirement mainly seems to be that, if coverage is not mandated, then insurers will choose not to provide this coverage and women will have to pay out of pocket (post-tax) for birth control rather than getting it at a discounted price via insurance, and this somehow is deleterious to women's health or otherwise just isn't right.

Since it's mainly a subjective matter, I'm in no position to evaluate moral right-versus-wrong here. I am in a position, however, to point out a critical flaw in the argument. In order for the pro-mandate argument to hold, it must be the case that women are not in a position to choose their employers, their schools or whatever other institutions may be providing them with health insurance. As a woman, I find this assumption to be absurd and more than a little insulting. Since women are free to choose the employers and schools that are best for them, those women who prioritize free access to birth control can seek out institutions that offer that benefit.

If women behaved in this way, employers and schools would have an incentive to offer contraceptive coverage to their female employees. These incentives would come not only from the fact that birth control is likely cheaper than the corresponding amount of prenatal care and maternity leave, but also from the fact that the institutions offering coverage would have a wider pool of applicants to choose from. Of course, some institutions might refuse coverage on ethical grounds, but they would either have to offer higher compensation to make up for it or accept the fact that its female applicant pool is going to be limited to those women who either don't care about birth control or can't get another job or school acceptance letter. (Economists call these outcomes "compensating differentials" and "efficient sorting," respectively. I call it "voting with one's feet.")

This market-based outcome is a scary one, especially in the current economic climate, since no one likes the idea of their employment or educational opportunities being limited. In fact, Sandra Fluke has noted that people shouldn't have to "pick between a quality education and [their] health." It's important to keep in mind, however, that no one's choices are being taken away -- if Sandra Fluke really likes Georgetown, for example, then it's probably worth it for her to go there even if it doesn't offer contraceptive coverage and other schools do, and, if not, her rejection of the school can send a strong message to the school about the ramifications of its policies.

Furthermore, the notion that a government mandate would provide guaranteed contraceptive coverage without any sort of compensating decrease in wages or other benefits (or, in the case of schools, increase in costs) is foolish. From an empowerment perspective, the bottom line is that women have an opportunity to fight back and take charge of the situation by asserting their rights to their labor and educational choices and not just to their bodies, and this has got to be more satisfying than simply resorting to asking the government for help.

If this argument sounds vaguely familiar to you, it's because it's not a new one. The dynamic described above is analogous to part of the typical libertarian argument against civil rights legislation in the 1950s and 1960s. (I realize that by stating this I am not exactly going to get a gold star for salesmanship.) In the case of civil rights, however, the argument for sorting into racist and non-racist companies generally fell flat because lawmakers (rightly) decided on behalf of society that all people have a fundamental right to not be discriminated against on the basis of their skin color. On the other hand, we as a society have not yet decided that free contraception is a fundamental right that all people should have (though I guess it does pretty neatly fall under the heading of "pursuit of happiness," eh?), which is fine, at least in my opinion. From an economic perspective, however, it can make sense to subsidize birth control if contraceptives have positive side effects for society that outweigh the cost of the subsidy.

Harvard economists Claudia Goldin and Larry Katz would argue that this is indeed the case, as the availability of contraception has made it easier for women to invest in education (resulting in a more educated work force) and enabled a better functioning marriage market due to the fact that people are more able to search around for good matches.

I'm pretty sure that that last point makes social conservatives' heads explode, but, hey, the truth hurts sometimes.

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