> "The economic argument would be that some of the benefits of creating new people are captured by the rest of society, not just the parents, and so to maximize efficiency, some of the costs should also be borne by society."
If you replace "new people" with "works of art" and "parents" by "artists" you have logic that applies equally to a universal subsidy for all artistic activities. This might be nice, but it's something that most people would recognize as impractical and idealistic. But when children enter the picture people lose all rationality and revert to a need-focused mindset instead of a resource-focused mindset.
An actual economic argument would be much simpler than the one your propose. The production of children must be subsidized if and only if it is an objectively valuable and necessary activity (which it is) but insufficient people are dedicated to the task (which is plainly not the case, as evidenced by the stable population of the US).
Reasoning based on who enjoys the benefits of an activity is not economics, it's philosophy.
The idea of positive externalities (also called "external benefits") is definitely mainstream economics. Deciding a priori what the "right" population level for the United States is seems philosophical to me.
There are plenty of other rebuttals to the argument I gave, though. For example:
1) Negative externalities from having children (crowding, etc.);
2) Deadweight losses caused by the taxes used to pay for the subsidy;
3) Calculation problems: deciding the proportion of internalized vs socialized benefits from children seems almost impossible to calculate even on average; if you get that wrong, your subsidy could easily do more harm than good;
4) Government power: even if this particular subsidy is efficient, if you give your government the authority to tax and subsidize broadly, they are likely to make plenty of bad decisions, which could partially or totally offset the benefits
If you replace "new people" with "works of art" and "parents" by "artists" you have logic that applies equally to a universal subsidy for all artistic activities. This might be nice, but it's something that most people would recognize as impractical and idealistic. But when children enter the picture people lose all rationality and revert to a need-focused mindset instead of a resource-focused mindset.
An actual economic argument would be much simpler than the one your propose. The production of children must be subsidized if and only if it is an objectively valuable and necessary activity (which it is) but insufficient people are dedicated to the task (which is plainly not the case, as evidenced by the stable population of the US).
Reasoning based on who enjoys the benefits of an activity is not economics, it's philosophy.