Has Hungary launched the greatest pro-natalist experiment in modern world history?

The current issue of the National Review, an American conservative biweekly magazine, carries an essay by Samuel Hammond entitled “Born in Hungary–What Budapest’s pro-natalist politics can teach social conservatives” (August 27, 2018, pgs. 18-22). Mr. Hammond is a policy analyst at a libertarian think tank in Washington, DC called the Niskanen Center and his work focuses specifically on issues of poverty and welfare. (As a Canadian publication, we should also note that he studied at Carleton University, in Ottawa.) In his piece on Hungary, Mr. Hammond writes: “Behind the vitriol that defines Viktor Orbán in the Western press is a government embarked on what may end up being the biggest natalist policy experiment in modern history–an experiment that is redefining the possibilities for modern social conservatism. Can government policies coax people to have more babies?”

Samuel Hammond

Mr. Hammond notes that Hungary’s population has declined by one million over the last three decades, bringing it down to 9.8 million. He also references emigration to wealthier member states of the European Union. Quoting the Hungarian action plan, he tells his readers that the goal is to increase the birth rate in Hungary from 1.5 children per woman to 2.1 by 2030. Mr. Hammond suggests that Hungary has adopted a multifaceted approach: a maternity leave program that allows for up to three years of leave, of which the first six months is paid, a housing assistance program called CSOK, which gives families that have three kids or more 10 million forints towards buying a new home, child tax allowances and cash stipends. Hungary now spends 5% of its GDP on these types of benefits. Mr. Hammond writes that it is too early to tell whether Hungary’s pro-natalist policies will work, but notes that between 2010 and 2016 marriage rates increased by 46% and that abortions are down by around 25%. And as a ‘fringe benefit’ of the housing subsidy program, real estate is booming–with rates up by 20%.

Back in January, the now defunct Magyar Nemzet daily published an article entitled: “The desire to get married is as high as after the World War.” The last time Hungary saw such an increase was between 1945 and 1950, and the rise was especially pronounced among those with lower levels of formal education and Hungarians with children. Mr. Hammond’s article, however, missed some of the nuance that appeared in the Magyar Nemzet piece: in 2016, there were 10,000 fewer marriages than the number that ended due to divorce or death, though admittedly this “deficit” is much smaller than the 30,000 or so that was typical in previous years. Yet whether the trend will continue remains an open question: statistics from 2017 show that the number of marriages decreased in 2017 compared to the previous year, by 2.4%.

In his essay, Mr. Hammond places Hungary within an international context, noting both countries that have failed and those that have succeeded in pro-natalist policies. For instance, Singapore paid $10,000 cash bonuses to families that had at least three children, yet the birth rate has dropped to just 1.16–far lower than the normal replacement rate. Japan has also failed in its pro-natalist efforts. “The decision to have a child turns out to be an incredibly complex one, mediated by labor markets, friends and family, and the broader cultural zeitgeist. It’s not obviously responsive to carrots or sticks, at least not on their own,” writes Mr. Hammond.

But there is one country where these policies have worked and it would appear as though Hungary carefully studied this specific nation’s model. We are talking about Russia. Following a policy change in 2007, the Russian birth rate has increased from 1.3 to 1.75 in just ten years. Russia now has the highest birth rate in all of Eastern Europe. At the centre of the Russian policy is something strikingly similar to Hungary’s CSOK program. Russian offers parents $7,200 as a one-time payment for a second or third child, which may be used to help cover housing expenses or education costs. More recently, plans were announced to offer parents mortgage subsidies and a $180/month child allowance for the initial 18 months.

Housing support, in Mr. Hammond’s estimation, is a critical element to a successful natalist policy. He suggests that American conservatives find free market ways to offer such assistance as well, such as by increasing the supply of homes in the U.S. through the easing of land use regulations.

But housing is not the only element that ties Hungary and Russia together, in terms of its pro-natalist programs. Both offer not just money, but a mission to parents. “Having children is explicitly construed as a noble pursuit in and of itself, with an intrinsic benefit that compensates for the non-market value that families–and mothers in particular–help to create,” writes Mr. Hammond. In both Russia and Hungary, childbirth is presented in one of two ways: a patriotic pursuit or a Christian duty.

Mr. Hammond adds:

“George Orwell was perhaps on to something when he posited a family resemblance between Catholic nationalism and Soviet ideology. Both rejected the commodification of core human relationships such as caring for a child. And both grasped the metaphysical importance of telos, whether the arc of history or the role of the so-called natural family. Of course, the danger in teleological thinking, now as then, is in its potential to justify subordinating the individual in the name of an elusive end state that never comes.”

That last line is especially salient, given the broader framework of an authoritarian, communal, anti-free market regime in Hungary and the encroaching power of the party state in all areas of life. As a libertarian policy analyst in Washington, Mr. Hammond should find Hungary’s System of National Cooperation most troubling.


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