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Advocates laud COVID-19 relief plan’s ‘massive’ investment in children

Advocates laud COVID-19 relief plan’s ‘massive’ investment in children

Picture of Giles Bruce
(Photo by Justin Sullivan/Getty Images)
(Photo by Justin Sullivan/Getty Images)

The Biden administration has unveiled a series of ambitious policy proposals to provide economic relief to parents and kids amid the pandemic. In response, children’s advocates are lauding the policies to combat child poverty and voice hope the programs become permanent supports for struggling families.

While the administration’s proposed $1.9 trillion COVID-19 relief package is still moving through Congress, with Republicans calling for a smaller bill, child policy experts are heartened by proposals like an expanded child tax credit and a boost for child care funding at a time when many families are struggling financially.

“There’s a lot that needs to be done, and we’re really looking forward to having an administration that is prioritizing these issues in D.C.,” said Angela Rothermel, director of early childhood for Children Now, a California-based nonprofit that focuses on children’s policy. “Any investment from the federal government or state government that gets more money into the pockets of working families is good for kids.”

Rothermel said a stable family income during a crisis can ward off household stress. She pointed to a 2016 study of the Great Recession that found that as the unemployment rate rose by 5%, the probability of mental health problems in children climbed 35% to 50%.

Biden’s stimulus proposal includes many measures that will help families, including giving $1,400 to every adult and child, increasing unemployment benefits by $400 a week, and expanding paid family and medical leave. The package also includes funds for housing and rent assistance, and extends the moratorium on evictions and foreclosure moratoriums through September.

The plan has a number of policies specifically designed for families with children, such as an increased child tax credit, more investment in child care, and funding increases for nutrition programs.

Researchers from Columbia University’s Center on Poverty and Social Policy found that Biden’s $1.9 trillion proposal has the potential to cut child poverty in half, with even more significant reductions for children of color. Even before the pandemic, the United States had one of the highest rates of children living in poverty of any developed nation.

“This is the boldest vision laid out by an American president for fighting poverty, and child poverty in particular, in at least half a century,” poverty researcher Luke Shaefer at the University of Michigan told New York Times columnist Nicholas Kristof.

Mayra Alvarez, president of the nonprofit The Children’s Partnership, said the administration's proposals send “an important message to the American people that they're ready to boldly respond to the pandemic and, frankly, to the multiple crises that families are facing right now.”

“And they're recognizing that it's multiple crises — that it is the COVID-19 pandemic, but that it's also systemic racism and recognizing that those are intersecting pandemics that have for too long plagued many marginalized communities in our country and their children especially,” she said. “It’s long awaited. It’s filling us with hope.”

Child tax credit could increase

President Biden wants to raise the child tax credit from the current $2,000 for kids 16 and younger to $3,600 per child under the age of 6, and $3,000 for kids 7 to 18. The proposal would also make the tax credit fully refundable, meaning families get the benefit even if the credit is larger than the taxes they owe. Currently, an estimated 27 million children live in families with too little income to receive the whole amount.

“That’s just a massive increase in investment in children,” said Elisa Minoff, senior policy analyst for the Center for the Study of Social Policy, a nonprofit research and policy group based in Washington, D.C.

She said she hopes the expanded credit will act more like the so-called child benefits or child allowances seen in countries like Canada and the United Kingdom, which are paid out monthly. House Democrats have been drafting a plan for the benefit to work the same way here, since many families can’t afford to wait until the end of the year to claim the money. 

Universal child benefit programs have been found to reduce child poverty rates in high-income countries by an average of 5%, according to a 2020 UNICEF report.

“Having that regular income, in addition to whatever income they receive from work, really relieves a lot of stress that comes along with raising kids on a limited income and improves the mental and physical health of caregivers as well as that of children,” Minoff said.

She said that measures like economic impact payments and enhanced unemployment benefits have been effective at keeping families financially afloat during the crisis. After the passage of the first COVID-19 relief package last spring, the poverty rate actually decreased to below pre-pandemic levels, according to data from the University of Chicago.

Ideally, a child benefit would be available to every family and easy to apply for and receive, Minoff said. About 20% of those eligible for the earned income tax credit don’t claim it, in part because of its complexity.

While Minoff noted that the child tax credit reform might not survive in its current form, the current makeup of Congress and the fact that an expansion has had bipartisan support leave her optimistic about its prospects.

Biden’s relief package would also extend the 15% increase of the food stamp program, known as Supplemental Nutrition Assistance Program, through September and invest $3 billion in the Women, Infants and Children (WIC) program over multiple years.

Saving child care providers from closure

To revamp child care, the administration is proposing a $25 billion emergency child care stabilization fund to help struggling child care providers keep their doors open. 

A December report from the National Association for the Education of Young Children found that one in four child care centers and one in three child care homes would close in the coming months without significant aid. The White House estimates that nearly half of child care providers will be eligible for funds.

“There is no rebuilding of our communities from this pandemic if we don't address the critical need of child care for families, because it's directly tied to parents’ ability to return to the workplace,” said Alvarez of The Children’s Partnership.

The administration has also proposed an additional $15 billion to the Child Care and Development Block Grant program that provides child care subsidies to families, and increases the child care tax credit from $3,000 to $4,000 for one child and $6,000 to $8,000 for two or more children (and also makes it fully refundable).

Advocates hope some of the funding will be used to raise pay for child care workers. 

“One of the issues we’ve known for years is how underpaid child care staff are,” said Marsha Gerdes, senior psychologist with PolicyLab at the Children’s Hospital of Philadelphia. She noted that the average pay for child care workers in the U.S. is $11.65 an hour, making them eligible for subsidized child care themselves.

“The need to increase the kind of base salary for child care is certainly needed,” she said, “and so is a cultural shift of looking at child care not as child care, but as early childhood education and a foundation for school.”

Rothermel said investing in quality child care has a “two-generational effect”: It allows parents to work and increase their lifetime earning potential while providing an enriching environment for kids that can better prepare them for school.

“The challenge when you're talking about issues, especially child care, is that for decades there has been such an under-investment, and that when the pandemic happened it really cratered everything,” she said. “And so, to build back, we have to not only make investments that are responsive to immediate needs, we also have to take into account that we haven't been investing in these programs for many, many, many years, and we are far, far behind other countries.”

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