Childcare subsidies are work subsidies — for better and worse

In Focus delivers deeper coverage of the political, cultural, and ideological issues shaping America. Published daily by senior writers and experts, these in-depth pieces go beyond the headlines to give readers the full picture. You can find our full list of In Focus pieces here. Conservatives and liberals alike denounced a Trump administration proposal to extend federal childcare subsidies to stay-at-home moms.If you think of childcare subsidies as a way to make sure children are cared for, the reaction seems odd: If we’re subsidizing some forms of childcare, why are we excluding the single best model? The objections make sense, though, if you see childcare policy the way Washington sees childcare policy: Not so much family policy as labor policy. That is, the U.S. subsidizes childcare primarily to promote employment.The intention and effect of most federal and state support for childcare is to induce more mothers — single and married — into the labor force.There are plenty of arguments for this sort of thing. Some arguments are feminist, some are purely economic. One is downright conservative, and several are tied up with welfare reform.Before we can understand the debate that seems to pit stay-at-home moms against working mothers, we need to understand how and why our policymakers have tried to get so many moms out of the home and into the workplace.How we talk about childcare subsidies President Joe Biden regularly touted childcare subsidies and universal pre-K subsidies, not primarily as ways to raise and educate children, but as ways to boost the employment of mothers. Nearly 2 million women in our country have been locked out of the workforce because they have to care for a child or an elderly relative at home.My Build Back Better Act will make caregiving accessible and affordable and help them get back to work.— Joe Biden (@JoeBiden) November 23, 2021 “Nearly 2 million women in our country have been locked out of the workforce because they have to care for a child or an elderly relative at home,” Biden declared in late 2021. “My Build Back Better Act will make caregiving accessible and affordable and help them get back to work.”Heather Boushey, a top economics adviser for Biden, argued that Americans should see childcare subsidies “as things that make it possible for family members to go out there and get a job. It’s really about enabling people to work.”“The Care Economy is Critical for Supporting Labor Force Participation,” the Biden White House wrote on a rare occasion when it addressed falling birthrates. “Accessing dependent care is an example of one particularly severe constraint to labor force participation.”The Trump administration, likewise, describes the Child Care Development Fund this way: “CCDF provides financial assistance to low-income families to access child care so they can work or attend a job training or educational program.”In decades past, these programs were justified on broader terms. In the late 1980s and the 1990s, when the HHS childcare subsidies were created, lawmakers mostly cited children’s safety and development, but also touted their policies as ways to get women into work.The Child Care Improvement Act of 1989, for instance, included this clause justifying its subsidies: “Because of the lack of affordable child care, a large number of parents are not able to work or to seek the training or education they need to become self-sufficient; making adequate child care services available for parents who are employed, seeking employment, or seeking to develop, employment skills promotes and strengthens the well-being of families and the national economy.”This is where most of the energy for childcare subsidies comes from today: getting mothers to work.How childcare subsidies work You can see this intention in the design of today’s subsidies, many of which will not subsidize childcare for any purpose besides paid work.Consider the Child & Dependent Care Tax Credit, which gives parents up to $1,050 per year per child (up to two) to cover a portion of childcare costs. The only childcare that counts for this credit, though, is childcare needed so that a parent can work.If a stay-at-home mom needs a nanny for the baby so she can homeschool the older kids, she cannot access the CDCTC. If a mother pays for daycare so she can volunteer or go to the gym while her husband works, or if a couple wants a babysitter for a night out, the tax credit is unavailable. In this way, it’s not a family subsidy, it’s a work subsidy.The Child Care and Development Block Grants, likewise, are only available for those who hire professional childcare (different states have different rules on how formal the childcare must be) while all parents do paid work. It would break the rules were a mother to use the voucher to hire daycare for, say, volunteer-teaching at a co-op, making dinner, or taking the baby to a doctor’s appointment.These policies then subsidize work rather than familial, personal, or community activities. The next question is why.Married moms and single moms Economists and policymakers often focus narrowly on economic measures, ignoring cultural goods or other less quantifiable goods. As a result, they seek policies that will maximize economic transactions and minimize non-economic transactions.A stay-at-home Mom is bad for Gross Domestic Product insofar as she doesn’t pay for childcare, she doesn’t earn income, is less likely to order takeout, or hire a house cleaner.“We are clearly leaving GDP points on the table,” fretted liberal economics columnist Jordan Weissman in a 2019 column. We ought to be “reserving more child care for professional centers that can do it a bit more efficiently,” he wrote. Even after factoring in “rent and other overhead, it’s probably more cost-­effective for one caretaker to watch over four infants than it is to have every parent looking after their own.”Biden argued that expanding federal subsidies for childcare would put millions of “women back in the workforce” and “would increase the GDP —­ to sound like a wonk here —­ by about eight-­tenths of 1 percent. It would grow the economy.”Feminism is also behind the public policy efforts to induce mothers into paid employment. On the opinion pages of our major newspapers, the suggestion of a mom staying home is denigrated as “retrograde,” causing moaning and groaning.Stay-at-home moms are vulnerable to exploitation and abuse, many argue, because they lose professional connections and skills, and thus cannot easily re-enter the job market. Equality and emancipation require more women in the workforce throughout their 20s, 30s, and 40s.Some scholars argue that children do better when both parents work. “Kids benefit from having a working mom,” declare researchers at Harvard Business School. Dozens of studies have explored this question, and many of them have found better outcomes for the children (especially the daughters) of employed mothers.But one meta-study in 2012 found an interesting pattern: Some studies found no benefit from a working mother, and those studies looked mostly at married mothers; the studies that found a benefit from an employed mom? They examined mostly unmarried mothers.So here’s how to make sense of this all: Children benefit from having a parent who holds down a full-time job. This isn’t just about the family having resources. This is about a child growing up with the example of full-time employment and building a career.Poverty gets passed from one generation to another largely because children grow up raised by a single mom on welfare.STAY AT HOME MOMS ARE GOOD AND AMERICA NEEDS MORE OF THEMThis is one reason policymakers want to subsidize daycare in order to subsidize work: A single mother cannot work without childcare, but cannot afford childcare on her own; subsidizing her childcare will give her a chance to work a job, get off of welfare, and give her children a positive example of hard work and self-reliance.That is, sometimes Washington has ideological or purely fiscal reasons to try to subsidize employment for moms, but sometimes it’s the best way to help a family that finds itself in a bad situation.This logic doesn’t justify our policies, like the CDCTC, which subsidize dual-income families, but it does apply to the block grants being debated today, because those overwhelmingly go to single moms.