The dollars and cents of gay marriage
Gay marriage challenges society. It roils contemporary politics and raises moral objections for some. But on economists' screens, it barely registers.
That's because legalizing gay marriage isn't that costly in economic terms. In fact, research suggests it should save money for federal and state governments. And for corporate America, the costs of extending benefits to the partners and families of gay employees are small.
Did you ever wonder why more and more companies, state and municipal governments, and colleges and universities are granting benefits to gay workers' partners and children? One big reason: It's cheap. On average, it would add 1 percent - 2 percent tops - to employers' benefit costs, says Susan Sandler, editor of a newsletter, HRfocus, for the Institute of Management and Administration in New York.
Demographics partially explains this modest impact. More than 96 percent of firms would face no additional costs for healthcare benefits, largely because most businesses would not have an employee married to a same-sex partner. That figure comes from a study released by the Institute for Gay and Lesbian Strategic Studies, an Amherst, Mass., think tank, and Human Rights Campaign (HRC), a Washington group seeking equal rights for lesbians, gays, bisexuals, and transgender people. Large firms, with more than 500 employees, would see an average increase in costs of just under $25,000 per year on average.
Already, nearly 7,500 employers extend such benefits, the HRC reports. A new survey of 459 firms by the Society for Human Resource Management in Alexandria, Va., found 39 percent providing domestic-partner benefits.
As for the financial impact on the government, a Congressional Budget Office (CBO) study found that if gay marriage were allowed throughout the United States, it would "improve the [federal] budget's bottom line to a small extent: by less than $1 billion in each of the next 10 years." (That wouldn't make much of a dent in a deficit expected to exceed $400 billion this year.)
The CBO calculates that same-sex couples would boost Social Security spending, because the partner of a deceased worker would receive 100 percent of the worker's benefit. But the federal government would save money on Supplemental Security Income, Medicaid, and Medicare.
The balance, CBO calculates, could be $50 million a year positive or negative on spending through 2009, and reduce spending by $100 million to $200 million annually from 2010 through 2014.
At the state level, studies by gay research or advocacy groups also find or predict a positive impact on budgets from same-sex marriage or domestic partner legislation.
That's primarily because the changed law would reduce the number of people utilizing means-tested programs, such as Medicaid and food stamps, says R. Bradley Sears, executive director of the Williams Project on Sexual Orientation Law at the University of California in Los Angeles. The incomes of domestic partners would be merged for means-testing, and some partners would look after each other without state help.
In California, for instance, same-sex marriage would save the state budget from $22.3 million to $25.2 million, according to a study by Mr. Sears and M.V. Lee Badgett, an economist at the University of Massachusetts, Amherst. Similar results have come from studies for Vermont, New Jersey, Ohio, and Oregon, Sears notes.
Conservatives discount these cost- benefit studies because they deal with the short-term impact, and not the long-term effect of redefining marriage.
Over a longer period, gay marriage will lead to fewer marriages of heterosexual couples, more out-of-wedlock births, and increased divorce, argues Matthew Spaulding, an analyst at the conservative Heritage Foundation. "The costs to society are massive."
Such trends, he says, have shown up in the Netherlands, where gay marriage has been legal for years. It was recently legalized in Belgium and Canada.
But Ms. Badgett sees no difference in these trends in the Netherlands from those in other European countries where same-sex marriage or registered partnerships are not legal. "It's hard to say what the impact is," she says. "Marriage rates are going up."