Question: What is the role of the state in securing the rights of minor children in domestic situations involving issues such as neglect, physical assault, sexual exploitation, and child labor?

Answer: In a general sense, Objectivists hold that children should be legally protected from abuse and from extremes of parental neglect. There is agreement also that by and large children should have more freedom to make choices as they grow up. When to draw the line on working for wages and making the choice to have sex is a matter I suppose would be debated, though I don't know of any debate on record, besides what takes place on email discussion lists.
I spoke on children's legal status at our Summer Seminar in 1998. I think it tricky to speak of children having "rights" in the full sense of the term Objectivists use, but I am nevertheless for rather broad legal protections of children. If you are interested, you can find a draft of the paper I wrote at that time online here . Other Objectivists, such as Francisco Villalobos who spoke at the 2000 Summer Seminar, argue that children do have rights. But to some degree the difference is technical and semantic. Neither of us disputes that children deserve legal protection from violence and abuse.
If you want to understand the technical issues involved, I suppose my paper is a good place to start. In essentials, the issue is: Objectivism holds that people have rights in virtue of their rational faculty, which enables them to live as independent producers and traders. This creates a harmony of interests between rational people. But children aren't rational in this sense, and can't live as independent producers and traders. So the standard Objectivist argument for rights doesn't apply to them. Indeed, the last thing small children need is anything like the rights adults should enjoy. Leave a baby alone and he starves.
The rights of children are more delimited and different from the rights of adults. 
So the rights of children are more delimited and different from the rights of adults. Children are rational beings coming-to-be, and their development is a wonderful natural event that is part of the cycle of life. So of course they are not to be maltreated. Today we have a somewhat exaggerated idea of what constitutes maltreatment, however, so Objectivists might prefer more freedom than is now allowed for older children to work and make other decisions, with concomitant responsibility for their decisions.
A related issue is parental obligation. In the Objectivist view, when a couple has a child, they take on the obligation to support and care for the child (although the exact specifications here are also debated). But the child is not per se the responsibility of others in society. So Objectivism holds that there is no governmental role in providing education, and most Objectivists hold that if a child is abused and must be removed from the parents, some private charity or adoption is the proper alternative, because in these cases a stranger voluntarily accepts the responsibility for the child.
What we have now is a system where we are all held responsible for every child (by law and through taxes levied on us), leaving us all holding the bag for every irresponsible teenager or drug-abusing wastrel who cares to reproduce. Rational charity might seek to help needy and deserving children, but that must be a choice that the people who pay for it make freely.

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