In his State of the Union address, President Biden received some of the loudest applause when calling for a congressional child care plan to sharply cut families’ costs and enable women to return to the workplace. He proposed funding these and other urgently needed changes through taxes on the wealthy — while reducing taxes on most all families through the Child Tax Credit.
The applause in the Chamber was likely echoed in living rooms everywhere. Our nation’s child care system is in a crisis that’s been exacerbated, but not caused, by the pandemic. Biden’s plan would address our nation’s historic and systemic underinvestment in child care by using budget reconciliation, which allows a simple majority of senators (and House members) to pass legislation for spending and taxes using a previously agreed-to budget resolution. President Biden is right that budget reconciliation can fix child care for families, children, child care workers, and the U.S. economy. It’s the fastest way to comprehensively address our child care crisis—where smaller, more incremental approaches will still come up short.
It’s no secret that the cost of child care is unbearable for most families. In many states, monthly child care costs often exceed the average mortgage payment, and the annual cost is higher than in-state college tuition. For families who are poor, child care costs average 30% of their income. At the same time, providers are being paid low wages that often aren’t enough to support their family, causing high turnover in the sector. Child care—especially high-quality care—is difficult to find and leads to parents, especially women, often being unable to work or having to cobble together family and/or multiple care arrangements.
Fortunately, the American Rescue Plan Act (ARPA) brought essential relief for families and saved many providers from collapse. It helped provide access to more families, brought resources directly to providers, and has begun to lay the groundwork for longer-term investments. But ARPA was designed to address a short-term emergency and didn’t provide enough resources to make child care fully affordable for families or to pay workers the respectable wages they deserve and need. And it is certainly not enough to undo the long-standing inequities and create a transformative system with meaningful and life-changing impacts for families, children, providers, and the economy.
The House seized the opportunity to address this in December and passed a reconciliation bill that would provide child care and pre-K to nearly all families with children under 5. It would make more care available and far more affordable by capping out-of-pocket costs at 7% of a family’s income (or approximately $3,500 for a family making $50,000). The bill would ensure providers earn a living wage and salaries matching those of K-12 teachers with similar experience. Importantly, it would allow families to return to or go to work, putting more money in families’ pockets and into the economy. It is truly a win-win-win that meets the scale of the problem.
Reconciliation can provide resources at a level for transformative change without the current challenging trade-offs caused by a lack of resources. When states invest in one important component of the system now, it often comes at the expense of something else that’s equally important and valuable. That trade-off creates a cycle of inadequacy where there is never enough child care available, it is far too expensive for families, and providers continue to make poverty-level wages. Simply put, the level of investment we need likely can’t be achieved through normal order, at least not in today’s political climate.
Due to limited resources and difficult decisions, current policies often lead to inequities. Budget reconciliation would allow policymakers the opportunity right now to reimagine our child care system and establish policies that can begin to address these inequities. In the current political environment, passing legislation with a simple majority, as reconciliation requires, is the only opportunity for meaningful change in the foreseeable future.
Parents, providers, and advocates are all counting on and want to work with Congress to make child care and pre-K an available and affordable reality for all. We also want to pass other critical supports for families—paid leave, home and community-based services, and the child tax credit, which are all essential for surviving the pandemic and thriving long-term. Let’s end the uncertainty that families so deeply feel and pass reconciliation with all of these valuable provisions, so families have economic security and safe, stable, and high-quality child care and pre-K.
Stephanie Schmit is the director of child care and early education at the Center for Law and Social Policy in Washington, D.C.