Baby Markets: Financial Market Expert Weighs In

by Jennifer Lahl, CBC President on July 14, 2016

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I recently interviewed David Bahnsen, a highly regarded, California-based investment manager and expert in financial markets about his views on markets and children.

Jennifer Lahl: I live in the back yard of the Silicon Valley, where, stealing from my colleague Dr. Bill Hurlbut at Stanford, we like to say, “We have a front seat on the future.” I have many questions on “the market” and the role markets play in a civil society to allow free enterprise to flourish, especially in the area of biotechnology and our shared common human good. I’m coming to you, an expert on the subject of markets to help me understand the role, if any, that markets play in the area of assisted reproductive technologies. I recently spoke at the University of California, Irvine’s “Baby Markets” symposium. What do you think of using the word market when it comes to babies?

David Bahnsen: The terms “market” and “babies” are not terms I have ever associated together. I suppose market mechanisms are heavily useful in providing FOR babies—consumer brand companies providing diapers and formula and baby toys and cribs and such—but the concept of a market for babies themselves, or a market for the reproduction of babies, strikes me as terribly troublesome.

Lahl: What role does or should government play in regulation or oversight of a baby market?

Bahnsen: The job of the state is to protect life and liberty and the pursuit of happiness. The state ought to be an agent for facilitating human liberty, and protecting human life. The state should be limiting and virtually eliminating, not facilitating, the treatment of a human life like a baseball card.

Lahl: Several years ago we were successful in getting California Governor Brown to veto a bill that would allow young women to sell their eggs in this state to assist the advancement of research. Brown opened his veto letter to the Assembly stating, “Not everything in life is for sale, nor should it be.” This bill, in a new version, is making its way back to the Governor’s desk. Do you agree with Brown’s statement?

Bahnsen: I certainly do. And since 1863, I thought our whole country did.

Lahl: If not for sale, then, is pure donation permissible when it comes to future children? Can we loan out our wombs to help others have babies, or give them our eggs/sperm? Is the issue commerce or the act itself?

Bahnsen: The medical ethics here may be slightly above my pay grade, or at least my ability to confidently engage. There are forms of artificial insemination and the types of things you are describing that are more prima facie reasonable to me than others; there are some behaviors I find repugnant.

Lahl: We have very little federal oversight, regulation or laws governing the space of reproductive technologies, so the battle, if you will, is taking place at the state level. With the Obergefell ruling, I’m busier than ever. Marriage equality has given way to Family equality, so the push now is for liberal enabling statutes. Do you think this should be a state or federal issue?

Bahnsen: Without question these are almost entirely state issues from a 10th amendment standpoint.

Lahl: All of these technologies are heavily controlled by contracts. Egg and sperm donors sign contracts agreeing to the terms. Surrogate mothers sign contracts. Lawyers and fertility doctors and agencies make lots of money on this baby market. What are your thoughts on contracts in this space?

Bahnsen: Again, besides the basic queasiness it mostly generates, and broad discomfort, my specific thoughts are that there should be a very limited market mechanism here, and that the underlying principle should be one that recognizes the unborn child as a human being, and not a mere vessel of commerce. To the extent there are various economic actors in some level of reproduction, contracts should be enforced as in any other part of a civilized society.

Lahl: We have two embryo custody battles occurring in California now between couples who created the embryos to have children and then for various reasons the couples split up. Now, like in any disputed breakup, the “property” is being fought over and the disposition of these embryos is being decided by the courts. Do you have any insights or wisdom to offer to help our thinking?

Bahnsen: I do not. These situations are what make the entire arena so queasy to begin with. The sanctity of the human life must be the top priority of the court, and the very best interests of the pre-born babies must guide the final adjudication.

Lahl: Libertarianism seems to be in fashion these days, especially with many of our younger voters and in areas like the Silicon Valley. What would you say to the libertarian in this space who wants contracts, free markets to decide for the baby market?

Bahnsen: I would say the same thing I would to any Libertarian about any number of issues in the realm of social ethics or political ethics: Ours is not an anarchistic society, and one of the very legitimate functions of a civil magistrate is to defend human life. Basic first things principles are needed for us to have a high personal freedom society; the one libertarians claim they want. Any agenda for greater political freedom driven by a closet desire for greater individual recklessness is going to fail. There is, across society, a need for freer markets, and yet there also are few and limited domains in which the magistrate must act to protect the defenseless. A cottage industry of baby-selling that creates human life like chattel is completely unacceptable, and the libertarian ethic and sociology is not going to mix well with a comprehensively cogent view on this subject.

David L. Bahnsen is founder, Managing Director, and Chief Investment Officer of The Bahnsen Group, a private wealth management boutique based in Newport Beach, CA.

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