For love alone? Understanding Australia's declining birth rate requires more than simplistic generational generalisations.

If you thought the Howard Government's changes to family assistance--especially the revised baby bonus payment--reeked of opportunistic vote-buying, save your venom for the true culprits. According to Clive Hamilton, director of the Australian Institute, these are the generation Xers who are dismissing the virtues of parenthood in favour of 'the icy waters of financial calculation' (Age, 13 May).

Most generation Xers, Hamilton claims, are in the grip of 'luxury fever'. Their 'decision to have a baby is the result of a cost-benefit analysis' and depends on a couple holding down 'two high-paying jobs ... a couple of expensive cars ... and [being] well on their way to providing for their retirement'.

Perhaps I'm taking Hamilton too seriously: only eighteen months ago, it was the baby boomers who were the target of his ire against luxury fever (Sydney Morning Herald, 30 November 2002), suggesting Hamilton might be choosing his generational targets pretty much at random.

In any case, he produces not a shred of evidence in support of his claims. For me, having a child didn't depend on two high-paying jobs, but it did help getting a job that wasn't casual--something that didn't happen for me, as for a lot of my peers, until I was in my early thirties. That at least meant I could take some paid time off around the birth (mainly annual leave) and can still access sick leave in case I need to care for a sick child. But my jobs are only fixed term, giving me considerably less permanency than my own father had when he became a parent. There's only one car, over ten years old, and, as the chequered work history suggests, the superannuation's not much to speak of. None of this is atypical amongst my friends.

To say, then, that financial hardship plays some role in delayed child-bearing, and hence a lower fertility rate, is much the same as saying prosperity played a role in the extraordinarily high birth rate of the postwar decades. Yet it seems the Xers are the icy cold financial calculators while our parents had the monopoly on the wondrous virtues of parenthood.

Behind the generation-bashing and libelling of my peers, there lurks the germ of a good point in Hamilton's piece. Whereas a child-poverty agenda dominated the Hawke-Keating Government's approach to family assistance, the Howard-Costello agenda is dominated by fears of falling fertility and an ageing population, as evidenced by Treasury's Intergenerational Report. Yet, contrary to the neo-liberal creed the current government espouses, there appears to be no invisible hand guiding the mass of individual procreation choices so as to produce an 'optimal' population level. (Optimal here seems to mean anything that doesn't approach full employment. To maintain the current employment-to-population ratio of around 60 per cent, we would need to get 6 per cent more of the working-age population into work over the next twenty years, which just happens to be the current unemployment rate. Better to have more kids than fewer unemployed.) Presented with such a clear case of market failure, Costello no doubt thinks some subsidisation of procreation is justifiable on efficiency grounds.

Yet moral panics around fertility have always been one strand of family assistance policy in Australia, going back to the first maternity allowance instituted in 1912. A non-means-tested cash payment, it excluded Aboriginal and 'coloured' women in an attempt to encourage white women to procreate. A National Health and Medical Research Council inquiry into the declining birth rate in 1944 threw its support behind child endowment, instituted three years earlier, as a suitable response to the 'problem'. (A British report at around the same time prefigured Hamilton's concerns, identifying the voluntary childlessness of the interwar years as a symptom of 'decadence'.)

Another strand to family policy, of course, and one that can't always be easily extricated from the first, is directed at ensuring families with children are not financially penalised relative to families without children, as well as ensuring that children don't grow up in poverty and hardship. These goals have always been finessed by reference to the 'costs' of children, going back to the Royal Commission on Child Endowment in the 1920s. According to Hamilton's argument, then, Australians have been mired in the icy waters of financial calculation for well nigh on one hundred years, or for at least as long as Treasury has handed out money for families.

The incentive question has resurfaced more recently thanks to the analyses of people like demographer Peter Macdonald. He points out that Scandinavian countries, which provide generous support for women wanting to combine paid work and motherhood, are not suffering from falling fertility, whereas southern European nations--Catholic countries, with strong 'family values'--are suffering the greatest falls. Macdonald's argument is one in support of the greater provision of early childhood services and more family-friendly industrial relations laws. It is the peculiar genius of Howard and Costello to turn this insight into a one-off cash-in-hand 'subsidy' that will simply translate into altered behaviour. The real problem with Hamilton's line is the presumption that people are icy financial calculators, just because Treasury mandarins act as though people are icy financial calculators. This would seem to offend the first rule of critical commentary: never, ever, concede that Treasury has got it right.

I suspect even Costello doesn't hold this view of human nature and feels there might be more solidaristic claims on people to have children. In his budget press conference, he referred to a duty to procreate for the good of the country. Hamilton, in contrast, can produce only self-regarding reasons for multiplying: the unlocking of deep springs of emotion in the parent, giving a parent's life a depth of interest and richness, parents coming to know themselves and gaining a sense of rootedness in the world. One would think that this 'sense of rootedness' is the precondition, not the result, of other-regarding decisions to procreate, the kind of thing for which the Liberals reckon a bit of bribery and patriotic rhetoric can substitute.

Since the early decades of Federation, family policy has reflected an amalgam of fertility scares, concerns over child poverty and feminist demands for citizenship and recognition of domestic labour. Rhetoric around the 'costs' of children has been a part of all these strands and, if we're still concerned about equity and the alleviation of financial hardship, it would be unwise to give it up. The likes of Peter Costello and Brendan Nelson, having benefited from free tertiary education, now want the next generation to pay its own way. Hamilton strikes me as another grumpy old man who, having grown up under a system of near-universal family assistance, wants the next generation and its children to get by on love alone.

Anthony O'Donnell is Research Fellow at the Centre for Employment and Labour Relations Law at the University of Melbourne.