Biden’s Proposed American Families Plan Would Revolutionize Life for Poor Children

When public policy has been entirely inadequate and misguided for decades, it is difficult to grasp the full implications of the beginning steps for reform. Such is the case with President Joe Biden’s proposal last week to respond to our society’s outrageous level of child poverty. The development of coherent, efficient policy to ameliorate the overwhelming and complicated problems of America’s poorest families will take a long time, even if Democrats continue to occupy the White House and sustain Congressional majorities.

But on April 28, President Biden introduced a plan to begin the journey to remedy fiscal austerity when it comes to our society’s poorest families and children. We can turn to some experts to put the significance of President Biden’s proposed American Families Plan in perspective.

California’s EdSource quotes Deborah Stipek, a professor in the Stanford University Graduate School of Education: “Biden’s proposals, so far, will go further toward supporting children—especially those living in poverty—than anyone in the White House in my lifetime… Right now, children from low-income families are beginning kindergarten substantially behind their middle-class peers. Most of the achievement gap is well in place when children begin school. One reason is lower participation in preschool and lower quality preschool for low-income children. Anything that broadens access and ensures quality is worth doing, and the child care and extension of the tax credit initiatives are very exciting.”

First Focus on Children’s Bruce Leslie also believes Biden’s American Families Plan is revolutionary: “There are moments in time when historic or transformational changes are made by our nation’s leaders to really make a difference for children and families in this country. If President Biden’s just released American Families Plan becomes law, today would be one of those moments.  Unfortunately, the reality we face is that children are often merely an afterthought of election officials, as kids do not vote, do not make campaign contributions or operate a Political Action Committee (PAC), and do not employ a team of lobbyists to demand that lawmakers hear their concerns and address their needs.”

About Biden’s plan, Leslie adds: “His plan fully recognizes the enormous (challenges)… that have plagued our children even before the current (COVID-19) crisis, including child poverty, inadequate early childhood supports, education inequities, substandard and unaffordable child care, health care affordability and access to care, the need for family medical leave, and college affordability. This plan also takes significant strides to address racial and socio-economic inequities among our children.”

Biden’s changes to the Child Tax Credit in the proposed American Families Plan extend changes Congress has already passed as part of Biden’s March relief bill. In the American Rescue plan, the President increased the amount of the child tax credit to $3,000 (and $3,600 per child for children under six years of age). Biden’s relief bill also made the Child Tax Credit fully refundable, which means that the poorest families—those too poor to pay enough income tax to receive the full tax credit in the past—will now qualify.  Biden’s March relief bill extends the changes in the Child Tax Credit only through this year, but the proposed American Families Plan would extend the reforms until 2025.

Leslie further examines the impact of changes in the Child Tax Credit as proposed by the American Families Plan: “The proposal extends the critically important tax provisions in the American Rescue Plan that have the potential to cut child poverty by an estimated 47%, according to an analysis by the Center on Poverty and Social Policy at Columbia University, and will benefit an estimated 66 million children—or more than 90% of all the children in this country. The American Family Plan achieves this by: making the Child Tax Credit fully refundable on a permanent basis; … expanding the credit to include 17-year-olds for the first time; increasing the Child Tax Credit from $2,000 per child to $3,000 for children between the ages of 6-18, (and) to $3,600 for children under the age of 6 through 2025;… (delivering) the Child Tax Credit regularly, meaning that families will not need to wait until tax season to receive a refund … (and) will receive regular payments that allow them to cover household expenses as they rise; (and) making permanent the Child and Dependent Care Tax Credit (CDCTC) improvements, which will give families a credit for up to half of their spending on qualified child care for children under age 13, up to a total of $4,000 for one child or $8,000 for two or more children.”

Expanding children’s access to quality childcare and enriched pre-Kindergarten are other urgently important improvements in Biden’s American Families Plan. But by examining today’s pay levels for child care workers and preschool teachers, one can see how economically untenable our current policies have become and how difficult it will to lift the salaries and the status of the women whose work is to care for young children. For Chalkbeat, Ann Schimke, Cassie Walker Burke, and Koby Levin report: “Nationally, the median hourly wage is $11.56 for child care workers and $14.67 for preschool teachers…. About 40% percent of the early childhood workforce are women of color, and many early childhood workers make so little that they qualify for public assistance.” The Chalkbeat reporters quote Meg Franko of Early Milestones Colorado: “It’s hard to recruit in the field when Target is paying more than you make as an early educator.”

The Chalkbeat reporters add: “In addition to the $15 minimum wage, Biden’s proposal calls for early childhood workers with comparable qualifications to kindergarten teachers—typically at least a bachelor’s degree—to earn commensurate pay.  Places such as New York City already have such pay parity efforts, but many workers struggle to take advantage of them because it’s hard to earn the necessary credentials while working full time for little money.”

The President of the Center on Budget and Policy Priority Priorities, Sharon Parrott emphasizes that together the American Jobs Plan and the American Families Plan will contribute to closing economic gaps by race: “(C)hild poverty rates are far higher among Black, Indigenous, and Latino children than white children. Prior to the recent one-year expansion of the Child Tax Credit (in the March relief bill), almost half of all Black and Latino children—-compared to about 1 in 5 white children got only a partial Child Tax Credit or none at all because their families’ incomes were too low. Ensuring that all families with low or no income get the full Child Tax Credit—an improvement made in the American Rescue Plan that the President wants to extend—will reduce disparities in child poverty rates and improve educational and employment outcomes for low-income children.”

Parrott adds that the President’s plan to pay for his reforms by raising taxes on wealthy individuals and corporations will itself address inequality: “To build toward an equitable recovery requires a tax system that raises revenues from those who have the most and who benefit greatly from public investments in everything from science and technology to infrastructure and education.  The Biden tax proposals would do this by curtailing the tax code’s tilt toward investments rather than income from labor… The plan would… help ensure that wealthy individuals and businesses pay the taxes they owe, by enabling the IRS to rebuild its depleted audit staff and upgrade its antiquated computer systems so that it can audit the returns of a larger share of high income households and corporations.”

If Biden can push legislation for his American Families Plan through Congress, Nobel Prize winning economist, Paul Krugman believes it will be overwhelmingly significant: “Conservatives beware: If the main elements in Joe Biden’s American Families Plan become law, they’ll be very hard to repeal. Why? Because they’ll deliver huge, indeed transformational benefits to millions. I mean, just imagine trying to take away affordable child care, universal pre-K, and paid leave for new parents once they’ve become part of the fabric of our society… The American Families Plan would… provide… free preschool for all 3-and 4-year-olds while limiting child care costs to not more than 7 percent of income for lower and middle-income parents… Just to be clear, making it possible for more women to take paid jobs isn’t the principal point of this plan—and there’s nothing wrong with parents’ choosing to stay at home and care for their kids. Instead, it’s mainly about improving the environment in which children grow up, partly as a matter of social justice, partly so that they eventually become healthier, more productive adults… (I)f these plans improve life for millions of Americans, will anyone besides professional ideologues care if they’re ‘big government’?”