I don't like this idea for two reasons: first, tax incentives for having children help to make sure the children are taken care of - socio-economic status is negatively correlated with number of children, and lots of kids are born into big families that can't afford to take care of them properly. Giving these families additional money seems like enabling them, but the kid didn't do anything and deserves to have a reasonable standard of living.

Second, financial penalties for having children give the wealthy more freedom to reproduce. And couldn't tax penalties be considered a form of government force? Not that we don't already use incentives and penalties to shape behavior.

Education, access to birth control, and improving the standard of living of the poor all seem to result in lower birth rates with no force necessary.

Implying western countries produce too many children relative to the death rate. Overpopulation is far more prevalent in the underdeveloped countries. If their standard of living improves, with enhanced education (contraceptive) the populations are estimated to balance out to that of Western countries.

Western countries have to worry far more about immigration than birth rate control.