As with most dystopias, the world which is portrayed in Among the Hidden is ruled by a government with virtually unlimited power. And the government in this society uses its power to insist that no family can have more than two children.
The very fact that such a law can exist indicates just how much power the government has in this particular society. Restricting the size of families is something that simply doesn't happen in open societies.
For many years, the People's Republic of China adopted a “one-child” policy, which, as the name suggests, restricted families to having just one child. But the government was only able to implement such a policy because China is a one-party state in which people have limited civil and political rights.
Not only can the government in Among the Hidden demand that families have no more than two children, it also has the power to hunt down and kill any additional children, or shadow children as they're known.
The Population Police, whose job it is to enforce the two-child law, regularly look for any sign of shadow children. This means that shadow children like the story's protagonist Luke are forced to lead a secret existence, cooped up in their homes all day in case someone sees them and reports them to the authorities.
Some degree of underground resistance to the government may exist in this dystopian state, but that in no way diminishes the government's power. We can see this when Luke's friend Jen and forty other children are brutally shot dead at an anti-government rally.