Build Back Better proposal of subsidized childcare might dramatically escalate costs for families

"The costs have to be borne by someone, and that’s the parents," said Linda Smith of the Bipartisan Policy Center’s early childhood initiative.

Nick Monroe Cleveland Ohio

Amid the immediate concerns surrounding inflation costs impacting the everyday household, worries about one of the "Build Back Better" proposals involving subsidized childcare is being discussed.

As outlined in Politico, Democrats are trying to put their pitch into the multi-trillion dollar "Build Back Better" spending bill. The worry surrounds how and when kickbacks from the government would come into play.

Progressives in DC are trying to mandate higher salaries for childcare workers. The question is how much of the cost do parents have to pay, balanced with when exactly the US government steps in to pay subsidies for families.

Jacobin magazine provides tables for the system that Democrats intend to put into play. It’d put childcare workers who previously made $25,000 a year on par with elementary school teachers at $60,000 a year.

The childcare plan proposal switches out flat fees with a copayment scale system phased in over the next few years. By dramatically increasing the cost of childcare and letting the US government pay the rest on subsidies, it means those left out of the eligible income brackets are facing the entire unsubsidized costs through 2024.

Copayment in and of itself is tied to income and goes upwards of seven percent if a household makes over 150 percent of the state median.

Under this system it comes off as if families who just barely make enough money to get into a higher income bracket are suddenly faced with a massive spike in childcare costs during this three-year period of transition.

Matt Bruenig of the People’s Policy Project have expressed concern over how the Democrat’s plan would raise healthcare costs. Fully unsubsidized it’d raise the cost for the average family by $13,000, to $29,000 on the high end overall.

Melissa Boteach, vice president for childcare and early learning at the National Women’s Law Center told CNBC anyone highlighting the potential for cost jumps is "alarmist."

The outlet’s reporting says the pay increase doesn’t kick in right away either, so costs might not be passed onto parents as much, as immediately.

Elsewhere, another element of the "Build Back Better" agenda was reported earlier this week. Secretary of the Treasury Janet Yellen told CNN’s Jake Tapper about the possibility of the Biden administration enacting "unrealized capital gains" taxes on assets.


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