A (Mostly Serious) 10-year Plan to Transform U.S. Child Care*
by Elliot Haspel
*Defined as all external care settings, primarily for children under the age of 6. Child care here is used synonymously and interchangeably with early childhood education and early care & education.
Context: The U.S. child care system didn’t work before COVID-19. It’s in free-fall now. When we talk about “transforming the system,” it can be useful to go beyond generalities and push toward defining an actual concrete vision. This post is intended as a jumping-off point, a thought experiment of sorts. Although the proposal is real and I believe in the overarching mold, it certainly requires much more development. The child care field would do well to put a number of such competing ideas on the table, select one to rally around, and then build out the financing and technical policy backup (and then brand it and articulate the advocacy strategies to win it, although that’s a point for another post; we don’t yet have our Fight for $15, our Marriage Equality). It’s my hope these ideas can be productively provocative.
Phase 1: Hold Steady, and Pay Kin Caregivers: Summer 2020 through Summer 2022
In this phase, the government steps in to keep child cares whole under the (inadequate) pre-pandemic system, while zeroing out parent fees. This is a stabilization maneuver intended to make sure that child care providers do not permanently close their doors, and that the economic recovery is as smooth as possible once stay-at-home restrictions begin to be lifted.
In practice, the government would essentially take over 100 percent of the parent fees that were previously being paid. Every program would submit their enrollment (a three-month average of Dec. 2019 through Feb. 2020) and the fees parents were paying, and the government will provide that amount of funding each month for 24 months. This can be done relatively easily by passing the money through the existing state subsidy systems. Functionally, little will change other than who pays: parents will retain their existing slots, and those needing new slots will go through programs’ normal application processes.
Conceptually, this type of intervention is already in place in Australia and Vermont, although neither is providing funding at the level, or with the longevity, needed to safeguard the sector.
Additionally, this phase would see long-overdue compensation for stay-at-home parents and other kin primary caregivers (e.g. grandparents) in the form of a ‘home care stipend’. This stipend, a form of which exists in Northern European nations such as Finland, Norway, and Sweden, would be a flat rate of $5,000 per year, paid out monthly. In addition to finally recognizing the dignity of care work, these payments would act as a financial de-stressor for families with young children during this difficult period – particularly since it may be some time before external child cares are back at full capacity due to physical distancing causing caps on group sizes. As Matt Bruenig has pointed out, the Social Security Administration is well equipped to implement such a program.
Taking a home care stipend would be zero-sum with utilizing a child care program, and could be carved up; in other words, parents would certify that they or a relative are providing primary child care X weekdays and the child is in an external program Y weekdays, and receive a percentage of the stipend depending on the ratio. Given the relatively low stipend figure, there is little to no concern this would disincentivize re-employment in the post-COVID recovery. It would, however, help keep families with children – and therefore children themselves -- stable and healthy, and act as an ongoing fiscal stimulus.
Estimated Gross Cost Per 12 Months**: $100 Billion to $150 Billion (per calculations by NWLC and CLASP, plus assumption of 10 million kin caregivers)
**Does not reflect short-term benefits from faster economic recovery, more parents entering the workforce, increased tax revenue, or increased productivity; does not reflect medium-term benefits of more children entering formal schooling better prepared to meet expectations and not requiring extra services; does not reflect long-term benefits of more children graduating high school and proceeding to productive, successful livelihoods; does not reflect societal benefits of reducing parental stress and bolstering the value of care work.
Phase 2: Implement a Tuition Credit System (Fall 2022 through Summer 2025)
In this phase, the existing parent-fee market system begins to transition to a fully publicly-funded, choice-based system. Instead of the government paying for slots, parents select a licensed program they wish to attend, and once a slot is secured, fill out a simple form certifying that choice. Their tuition is then fully covered by the government (this is universal: there is no income means-test). Conceptually, this is similar to how the Denver Preschool Program or Minnesota Early Learning Scholarships operate, though again far more comprehensive in scope and scale.
THE BIG OBJECTION: “How are we going to pay for this?”: Please see this post. The big takeaways are that (A) there is an enormous immediate economic return from parents (mostly mothers) entering the workforce that slices the price tag, and (B) there are plenty of untapped revenue options. A state could implement a modified version of this transformation absent federal support, although the federal government is certainly best positioned to accomplish it under current conditions. As a few comparisons, it’s worth noting that combined government spending is over $700 billion annually for primary and secondary education and over $150 billion for higher education. Early care and education currently gets $34 billion. In this respect, the airline industry’s one-time bailout of $50 billion in the CARES Act was more money than all levels of government put into child care each year, despite child care enabling over 10 million Americans to work, and the sector itself generating nearly $100 billion in economic activity while employing two million practitioners. Which is a very long way of saying that the question isn’t ‘how are we going to pay for this,’ the question is, ‘how can we possibly afford not to?’
This phase allows new programs to arise, and gives existing programs time to become licensed and join their states’ Quality Rating & Improvement Systems (QRIS; these may need to be adjusted for post-COVID realities). A gradual phase-in is particularly important for child cares that may need time to make infrastructure improvements or take other actions in order to become licensed and enrolled in QRIS. A capital grant program should be set up to assist with these improvements, which could double as a way to reduce unemployment. Programs should have the option for taking “safe harbor” and remaining in the Phase 1 payment scheme until they are ready to join the tuition credit system.
After-school and summer programs for school-aged children can and should be easily wrapped into this system, reflecting that the average school day and year is mismatched with most parents’ working hours.
This phase also sees the development of a “public option” (an idea currently championed by NY-12 congressional candidate Suraj Patel) that will not be operational until Phase 3. This can be thought of as an expansion of Head Start and Early Head Start, as “universal pre-K” for all ages, or as an application of the military child care system to municipalities. The simplest delivery mechanism would be placing public child cares in/adjacent to public schools and have school districts administer the programs as they do school-based pre-K.
This phase also begins a transition away from for-profit child care. Starting Fall 2025, only non-profit providers, as well as those which are worker cooperative-owned, would be eligible for public dollars. Much like America’s K-12 public education system, for-profit child cares would legally be allowed to exist, but they would be at an extreme competitive disadvantage. States’ Child Care Resource & Referral Agencies would be funded to provide zero-cost assistance to programs that choose to become non-profits or worker cooperatives (note: ‘non-profit’ status does not mean that programs cannot turn a profit or pay healthy salaries, only that said profit must be returned to the program operations and that there are various disclosure requirements. For the vast majority of small and mid-sized child care providers, status as for-profit vs. non-profit bears no functional difference; in fact, these providers will be vastly more financially healthy under the proposed system)
Finally, the credit amount will gradually rise, heading towards a figure reflective of the local ‘true cost of quality,’ and the need to improve educator wages. The home care stipend remains in place as a permanent policy, rising annually via the Social Security Cost of Living Adjustment. Taking the home care stipend would make one ineligible for using the tuition credit, although there would again be flexibility to combine the two in parts, in order to meet diverse family needs.
Estimated Gross Cost Per 12 Months**: $150-250 Billion
Phase 3: A Fully Functional System with Focus on Honing Quality (Fall 2025-2030)
By this phase, parents are able to access free, licensed child care that meets their needs from the time a child is born until they graduate high school, including accessing a public option if desired. Providers of all types – from family child care homes to large centers – are receiving payments that allow them to sustainably run a high-quality program. Baseline early care & education practitioner salaries rise to $40,000 (adjusted down or up for cost of living), equivalent to that of elementary school educators, and with significantly higher salaries for more experienced educators. Oversight agencies are funded robustly enough to conduct regular observations and promote professional development. If a disaster like the COVID-19 pandemic strikes again, the government is easily able to keep the system upright. In short, child care is now a functional system.
This phase, then, primarily involves steady implementation and troubleshooting. The credit amount would continue to rise until levelling off at the true cost of quality (this may be $30,000 per child in highly expensive cities), and from there be indexed to inflation.
Estimated Gross Cost Per 12 Months**: $300-$500 Billion
Note on Coalitional Work: Child care does not exist in a vacuum. Most notably, if looked at objectively, any arc of family support that begins with (or before) a child’s birth should place a significant amount of paid family leave chronologically before voluntary external child care. And indeed, in most European nations, there are vanishingly few newborns in child care settings, as opposed to the U.S., where there are a startling number of six-week-olds -- put another way, children who are 42 days old -- in regular external care. Therefore, a transformational plan for the child care system should occur hand-in-glove with a plan to implement significant paid family leave (ideally six months to one year, and at full or nearly-full wage replacement). A similar case can be made for other policy areas ranging from home visiting to child allowances; the point is that this illustration is intentionally zooming in on child care, but should not be seen as replicating the misstep of keeping child care in a silo.
Elliot Haspel is a former elementary school teacher and early childhood policy analyst who writes about early childhood and K-12 education policy. He holds an M.Ed. in Education Policy from Harvard’s Graduate School of Education. Elliot’s work has been featured on The Washington Post, The New Republic, Romper, The 74 Million, and other sites. He resides in Richmond, VA with his wife and two young daughters. Elliot’s book, “Crawling Behind: America’s Child Care Crisis and How to Fix It,” was published in November 2019.