A new report from the U.S. Department of Treasury says the child care market in the United States causes undue burden on American families due to high cost and insufficient supply.
The report bolsters President Joe Biden’s Build Back Better agenda which calls for universal preschool for all 3- and 4-year-old children, expands tax credits for child care, and provides access to high-quality child care for low- and middle-income families.
“It’s past time that we treat child care as what it is – an element whose contribution to economic growth is as essential as infrastructure or energy,” said U.S. Treasury Secretary Janet Yellen during an event announcing the study. “This is why the Biden Administration has prioritized the Build Back Better proposals, many of which are now moving through Congress. Enacting them is the single most important thing we can do to build a stronger economy over the next several decades.”
According to the report, existing child care in the United States relies on private financing. The report estimated that the average family with at least one child under the age of five would spend approximately 13 percent of the family’s income on childcare. Often, the report said, this expense comes with the family can least afford it and lacks the ability to borrow against future savings to cover the costs.
Additionally, the report said, the current childcare market often fails to provide children with a high-quality early educational experience.
The administration said adopting their child care plan would cut spending in half for most American families allowing them to spend no more than 7 percent of their income on childcare by creating subsidized care, and extending the expanded child and dependent care tax credit. The plan would address revenue shortfalls while allowing families to contribute more to the nation’s economy, the administration said.
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