When asked recently how he would reduce the high cost of child care, former President Donald Trump said it would be “not very expensive” in relative terms — at least not compared to the revenue from tax increases he would impose on foreign goods.
Economists are skeptical that rates would rise enough to cover Trump’s tax cuts and a massive child care program, and Democrats have said higher rates would raise costs for families by raising the price of consumer goods. A Trump campaign spokesman did not respond to questions about his plans for child care.
On one point, some child care experts agree with Trump: Fixing the child care system would not be that expensive compared to other government spending. But as past proposals have shown, the price tags attached to a publicly funded child care system make it politically difficult to achieve.
“I think there’s some truth to his points: that adapting child care, making child care more accessible and affordable for families, is probably not that expensive in the grand scheme of things compared to a lot of other things that we’re already spending money on,” said Chloe Gibbs, an economist at the University of Notre Dame who served on the president’s Council of Economic Advisers from 2022 to 2023.
Trump made the comments about child care during an appearance Thursday at the New York Economic Club.
“We’re going to bring in trillions of dollars,” Trump said, referring to his proposed rates. “And even though child care is called expensive, it’s not that expensive relative to the numbers that we’re bringing in.”
Her election opponent, Vice President Kamala Harris, says she wants to reduce the financial burden of caring for families with children or disabled adults. She says she would raise wages for child care workers, preschool teachers and other professional caregivers. Her plan lacks specifics on how she would pay for those initiatives.
The child care industry is what Treasury Secretary Janet Yellen called a “broken market.” Despite low wages, labor costs are high, in part because one person can care for only a small number of children. Those costs are passed on to families, who often struggle to pay college tuition. Mothers end up staying home because child care costs more than they would earn in the workplace.
Many argue that child care will never be affordable for American families without a massive investment of taxpayer dollars.
Three years ago, President Joe Biden proposed a program to ensure that no family would spend more than 7% of their household income on child care as part of Build Back Better, a series of bills aimed at strengthening the social safety net and tackling climate change. The $400 billion universal preschool proposals alone did not survive concerns from Sen. Joe Manchin, a moderate Democrat from West Virginia, that the total cost of the package was too high.
Biden has reintroduced child care and early education proposals as part of his budget plan, but it is unlikely to pass.
A high-quality early education can change the course of a child’s life, says Hailey Gibbs, a policy analyst at the left-leaning Center for American Progress. Researchers have linked it to higher lifetime earnings and lower incarceration and dropout rates.
Another proposal, introduced in 2019 by U.S. Senator Elizabeth Warren, a Massachusetts Democrat, would have created a network of public early childhood education centers and in-home child care centers, free to low-income families. Warren proposed funding the programs, estimated to cost $700 billion over a decade, with a tax on millionaires.
Such proposals have largely failed because of the cost involved, but there is bipartisan support for some solutions. Sen. Tim Kaine of Virginia, a Democrat, and Sen. Katie Britt, a Republican from Alabama, jointly introduced bills in July that would expand the tax deduction households receive when they pay for child care and dependent care. It would also increase the tax deduction for businesses that provide child care to their employees.
During his own administration, Trump proposed a $1 billion fund that would give states child care subsidies and make the money contingent on reducing regulations. It never got off the ground.
Experts and advocates stress that spending on child care is an investment that can pay dividends. In the short term, it could put many more parents and caregivers back to work. The Council for a Strong America, a now-defunct nonprofit that advocated for government funding to support young people, estimated last year that the country lost about $122 billion in revenue and productivity because of child care issues.
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