Acton Institute PowerBlog

Elizabeth Warren’s universal child care proposal: What you need to know

Senator Elizabeth Warren unveiled a plan for universal child care, to be funded by a national wealth tax, late Monday night. Here are the facts you need to know.

What are the details of Warren’s universal child care proposal?

The program’s funding formula resembles ObamaCare for preschool. Warren’s “Universal Child Care and Early Learning Act” would provide daycare services “from birth to school entry” by creating a federally regulated system of “Child Care and Early Learning Centers” and “Family Child Care Homes.”

Families that earn up to twice the poverty level, or approximately $51,200 for a family of four, can access the preschools “free” (or, more accurately, for no cost at the point of service). Parents who exceed those guidelines would pay a sliding fee, but no home could spend more than seven percent of its income on child care.

Elizabeth Warren believes government-funded child care is a “right.”

“High-quality child care should be a right for all of our children and not just a privilege that only the wealthiest families can afford,” said Senator Warren.

 Warren estimates this will double the number of children in child care.

Approximately 6.8 million children are currently in child care. An analysis provided by Sen. Warren forecasts, “The proposal would ensure an estimated 12 million children, equal to 60% of those younger than 5, will ultimately receive formal care.” That includes an estimated “8.8 million kids in families below 200% of the federal poverty line [who] would receive free child care.”

How much will it cost, and how will it be funded?

Warren estimates her universal child care program will cost at least $700 billion over 10 years. It will be funded by her proposed wealth tax, which would impose a two percent tax on anyone with an estimated wealth of $50 million, or three percent for those with net assets of more than $1 billion. The tax’s advocates forecast it will raise $2.75 trillion over 10 years. However, their estimates assume the tax will have no impact on economic activity. The wealth tax will likely be struck down as an unconstitutional direct tax.

Does every dollar invested in child care return more than $7 in return?

Proponents of universal child care claim such programs save $7.16 for every dollar invested by reducing the participants’ crime and unemployment rates. These claims are based on two unrepresentative studies: The Perry Preschool Project conducted in Ypsilanti, Michigan, in 1962 and the Abecedarian Program in Chapel Hill, North Carolina, 10 years later. The projects – which involved a mere 115 students in the treatment groups (58 at Perry, 57 at Abecedarian) – went well beyond typical daycare by providing weekly in-home visits, individualized programs, even personal nutritional augmentation. “[P]roponents of government preschool programs continue to appeal to findings from 50 years ago that have never been replicated,” concluded Heritage Foundation expert Lindsey Burke.

More typical child care scenarios show increased aggression and anti-social behavior, especially among boys, and flatlined or decreased education levels.

Children in out-of-home daycare fare worse than those raised at the home.

Multiple studies agree with a 2005 analysis that children raised at home by a parent fare better than those raised at home by another relative, who fare better than those raised in an external child care facility.

Numerous studies have found that children who attended child care facilities have higher levels of aggression, hyperactivity, stress, cortisol levels, behavioral issues, impulse control, and poorer physical health. Moreover, the quality of care in the facility seems not to matter much.

These non-cognitive problems increase the more time a child spends in child care and last into adolescence. “The more time children spent in any of a variety of nonmaternal care arrangements across the first 4.5 years of life, the more externalizing problems and conflict with adults they manifested at 54 months of age and in kindergarten, as reported by mothers, caregivers, and teachers,” researchers discovered in a 2003 study. “More time in care not only predicted problem behavior and at-risk levels of problem behavior … as well as assertiveness, disobedience, and aggression.”

This sometimes includes criminal behavior. An analysis of Quebec’s government-funded universal child care found that participants were 4.6 percent more likely to be convicted of a crime, or 17 percent more likely to be convicted of a drug crime.

Some studies find children in universal child care programs fare worse academically.

Studies of the Head Start program have long found any advantages fade out no later than third grade. This is true of universal child care programs, as well. “In August 2013, Vanderbilt University released an evaluation demonstrating that children who went through Tennessee’s Voluntary Pre-K (TN-VPK) Program actually performed worse on cognitive tasks at the end of first grade than did the control group,” noted Burke.

Most women would prefer to raise their children inside their own home.

Gallup has “consistently found that the majority of working mothers would prefer to stay at home and take care of their house and family.” Pew found 80 percent of Americans believe the ideal situation is for one parent not to work (44 percent) or to work part time (36 percent).

Warren’s universal child care proposal would roughly double daycare workers’ salaries – and increase operational licensing laws.

Warren’s proposal stipulates “that compensation (wages and benefits) for child care workers be comparable to those of similarly-credentialed local public school teachers.” The average salary of daycare workers is $23,760, and preschool teachers is $33,590. The average public school teacher’s salary was $59,660 in the 2016-2017 school year, according to the NEA. But as the Department of Education states, “Teacher compensation is more than salary. It is a valuable total package that includes salary, extra pay, benefits, and pension.” Adding this brings the average teacher’s total compensation to $87,854, according to Jim Agresti of JustFacts.com. Teachers also work an average of 37 or 38 weeks a year, 37 percent fewer hours than those in the private sector, raising their total compensation for a full year to $120,578.

The proposal would likely raise costs.

Warren’s press materials claim, “The typical American family with young children currently paying for formal care would see their annual child-care costs decline by 17% to less than $6,000 per year” – an average drop of $1,200 a year, or $100 a month. Barack Obama similarly claimed the Affordable Care Act would reduce insurance premiums by $2,500; instead, premiums rose 105 percent from 2013 to 2017. As noted, the two programs share a similar payment structure. Moreover, massively increasing enrollment and teacher pay is unlikely to hold prices down. Rising costs mean that mothers, who previously did not need federal subsidies, cannot do without them.

Does child care cost more than college tuition?

Randi Weingarten of the American Federation of Teachers said that “child care is more expensive than the cost of college tuition in 28 states.” Yet an analysis of Warren’s plan by Moody Analytics states, “The typical household that has child-care expenses spent $7,200 per year, equal to approximately 10% of their income.” Tuition and fees at four-year public universities average $10,230 in the U.S., according to the College Board.

Targeted interventions would have greater impact at lower cost.

Some studies of universal child care programs in Germany and Georgia find benefits for at-risk children, especially immigrants. A program targeting this demographic could have all of the benefits, and fewer of the side effects, at a much smaller cost.

What does the Constitution say about this federal program?

“The federal government has no constitutional authority to enact a universal preschool program,” notes the Cato Handbook for Policymakers.

Why should people of faith care about this proposal?

Children flourish when raised in a loving home by one of their own parents. This is also the natural and scriptural pattern. “Parents have the first responsibility for the education of their children,” according to the Catechism of the Catholic Church. “Following the principle of subsidiarity, larger communities should take care not to usurp the family’s prerogatives or interfere in its life.”

While a national child care program hardly creates a totalitarian state, replacing the family with the state has been the dream of statists from Plato to Karl Marx.

Warren’s universal child care program is a step towards a literal cradle-to-grave welfare state that will impose steep costs – both economic and emotional. And the well-being of children is too high a price to pay.

(Photo credit: Edward Kimmel. This photo has been cropped. CC BY-SA 2.0.)