Eleanor Mueller wrote a piece at Politico about my recent criticism of the Democrats’ child care proposal. The piece is fine as far as things go, but in it, the advocates who are mad at me don’t actually seem to be saying that my core claim — that the child care plan will increase costs for middle class parents — is wrong. In fact, they actually say things that amount to the same point, but don’t seem to necessarily realize it.
Before getting into the specifics of this dispute, it’s perhaps useful to address some of the framing of the piece, which has taken on a life of its own. The piece is titled “Democrats defend their child care plan against unexpected attack” and the first sentence is:
Democratic lawmakers and their allies are moving quickly to dull a dagger aimed — from the left, of all places — at their much-touted plan to make child care more affordable for American families.
I tend to gloss over these kinds of presentational choices and scan for the quotes but others seem more attuned to them. So let me say for clarification purposes here that highlighting the flaws of welfare proposals and offering better alternatives is probably around 75 percent of my output. If you don’t expect me to critique a means-tested family benefits program, then you must not be familiar with what I do.
Before my recent turn towards child care, I spent a few weeks talking about the Democrats paid leave plan (I, II), which I criticized for its lack of minimum benefit, work history requirements, lack of option for parents to transfer leave weeks to each other, and private insurance subsidies. I argue that these problems can easily be fixed by using an older Democratic paid leave proposal — the FAMILY Act — and making a few changes in the bill text. I even helped write a video for One Perfect Union about it.
NEW: President Biden proposed a good paid leave program. House Democrat Richard Neal made it terrible, turning it into a complex and inefficient giveaway to the insurance industry.— More Perfect Union (@MorePerfectUS) October 19, 2021
Congress must fix it by making it a simple Social Security-like program. pic.twitter.com/7tA4LGrGrF
Prior to that, I spent a lot of time critiquing the new Child Tax Credit, primarily focused on the fact that the design makes it difficult to reach children living in non-filing tax units, which are the poorest of the poor. I argue that creating a universal child allowance run by the Social Security Administration would be a better approach and have offered a variety of other ideas to help fix the non-filer problem that fall short of my own preferred approach.
The only part of the Build Back Better family benefits package I haven’t criticized much is the universal pre-k proposal. The only thing I’ve said about that is that the state cost-sharing could lead some states not to participate, which is bad. But other than that, I think the pre-k proposal — which remember is just child care for ages 3 and 4 even though it has a different name — is basically fine and so I have nothing much to say about it.
Design good programs and I won’t criticize them. Design bad programs and expect a critique followed by an alternative proposal. This is the People’s Policy Project Promise.
What Will Happen to Unsubsidized Child Care Users?
My claim is that the Democratic child care bill will massively increase the unsubsidized price of child care within the first three years of the program. This will happen directly as a result of wage and quality mandates contained in the bill but also indirectly as a result of dramatically increasing demand for child care services by making those services free or nearly free for the bottom half of kids.
To illustrate what kind of price rise we might be talking about, I calculated what would happen if the salaries of infant care workers were increased from the current levels to the salaries received by kindergarten teachers. This is the salary level the bill says states must move towards. In this scenario, wages rise by 138 percent, which increases unsubsidized prices by around $13,000 per year.
I am open to the possibility that the number will be higher or lower than that. Perhaps, as I mentioned in yesterday’s piece, it will only be a $7,200 hike, a number which assumes that child care workers will only get about halfway between their current salary and the salary of kindergarten teachers. But whatever the number, it’s clear that it’s higher than $0, and not by a little. I welcome other guesses at to what the number will be, but so far those guesses aren’t forthcoming.
Instead, in the Politico piece, we get a variety of mostly non-responsive responses.
Here is Patty Murray’s communications person:
“The Build Back Better child care and universal pre-K proposal will dramatically lower child care costs for the vast majority of working families, make child care more available to every single family and also ensure that child care workers are paid a livable wage,” Senate HELP Chair Patty Murray (D-Wash.) said. “This proposal will mark a foundational shift in how our country supports working parents — and I’m fighting hard to get it across the finish line.”
These are the usual talking points for the bill, but notice that, in them, Murray is touting big wage hikes for child care workers. This is exactly what I am saying as well. The bill will significantly increase child care wages, which will require unsubsidized users, i.e. families with incomes slightly above their state median income, to pay higher fees.
Here’s the next substantive quote from an anonymous Democratic aide:
“This program provides subsidies and grants directly to providers to cover the costs of low- and middle-income families, and those subsidies and grants will offset the cost of livable wages for workers,” a Democratic aide said.
As with the Murray quote, this is exactly what I am saying as well. Wages will go up. Subsidies will cover the costs of those higher wages for families with incomes below the benefit cutoff, but not for families above the benefit cutoff who will be paying the unsubsidized price.
Here is CAP’s Rasheed Malik who had a lot to say:
“Fundamentally, this analysis takes what we would hope as an optimal end point, and pushes it into the first year,” said Rasheed Malik, associate director of research for early childhood policy at the left-leaning Center for American Progress. “It takes an extreme set of numbers to come to a totally unrealistic conclusion, and in the process ignores all of the details that are in there.”
It’s not based on a close reading of the bill, or even a close reading of expert summaries of the bill,” he added. “We don’t even have enough child care right now; we actually have to build our way up to a fully functioning system.”
Increased costs for parents could be avoided by making all families eligible for subsidies upon enactment, Bruenig said. Democrats’ decision to phase in eligibility was “just to bring down the score.”
Advocates counter that doing so would not only be more expensive, it could hurt families by locking out lower-income parents due to the low supply of child care.
“As much as I would love to roll out a universal system right away, that would actually have terribly negative unintended consequences for the most vulnerable,” Malik said.
In the first paragraph, Malik is just quibbling with the $13,000 price hike figure. It won’t be that high, he says. As I said already, I am open to other numbers. But what is his number? $5,000? $7,500? It certainly is not $0.
The remainder of the quotes are fascinating because Malik pivots towards critiquing my alternative proposal (which is to provide subsidies to all families) as opposed to arguing about what the price hike for unsubsidized families will be. But in that pivot, he is clearly making arguments that confirm the basic claim that unsubsidized prices are going to go way up.
His argument against providing universal subsidies in year one is that we have a very low supply of child care right now and that the supply cannot be ramped up to meet all the new demand that would come from universally subsidizing all parents. And so instead of universally subsidizing all parents, we should only subsidize parents with incomes below the thresholds in the bill in order to make sure that those parents get the scarce child care spots and that parents with incomes over the thresholds don’t.
But this is just another way of saying that middle class families with incomes over the threshold are going to not be able to afford child care during the transitionary period. His argument against universalism is premised upon my argument about the middle class squeeze being true!
The last person in the piece is Melissa Boteach. She has a quote similar to Malik’s in which she quibbles with the $13,000 figure but doesn’t offer an alternative figure but also doesn’t say that the real number is $0 or thereabouts. I’ve said what I can say about that.
She also has a lot of quotes about the politics of the whole thing:
“People are nervous because everyone’s on tenterhooks as this package shrinks and people are negotiating what’s in and what’s out,” said Melissa Boteach, vice president of income security, child care and early learning at the National Women’s Law Center.
Boteach said Bruenig is comparing President Joe Biden’s Build Back Better plan “to an idealized policy with unlimited funds.”
“That’s not the right comparison: The right comparison is Build Back Better with doing nothing. And doing nothing means more women get pushed out of the labor force, more providers leave the sector, and we have a collapsing care infrastructure.”
Putting aside the fact that price hikes for unsubsidized users will also drive women out of the labor force, these quotes do helpfully clarify why so many strange non-responses have been flying my way on this. Boteach is not saying that unsubsidized prices won’t go up. She’s not saying this is a good plan and even seems to be saying that my alternative is better. But she thinks this messy proposal is the only thing that could pass and is worried that discussions of its flaws will mean it gets cut entirely in favor of other programs being discussed.
Perhaps she’s right, but as I noted already above, I am just calling it like I see it. I’ve got problems with most of the other proposals too. They all suck in their own ways and, in fact, in my official ranking of the four family benefits in the bill, child care is not even the worst of the bunch. Paid leave is. I am not much of a legislative strategist, but if I were, I’d say to spend more time attacking the goofy paid leave proposal and less time getting angry at valid criticisms of the child care proposal.