How Elizabeth Warren’s Universal Child Care Plan Would Affect You

Sen. Elizabeth Warren (D-MA), who is seen as a top 2020 Democratic candidate, unveiled an ambitious proposal Tuesday that would offer low- or no-cost child care to all American families, regardless of income. “How much you make at your job should not determine the quality care your child gets,” Warren said, debuting the plan on Twitter. “Child care should be a fundamental right, period.”

Another big, structural change we need: #UniversalChildCare. I’m proposing a bold new plan that guarantees high-quality child care and early education for every child in America. It will be free for millions of families, and affordable for everyone. pic.twitter.com/lFFZO7kwhu

— Elizabeth Warren (@ewarren) February 19, 2019

Warren’s home state of Massachusetts has one of the highest average child care costs in the country — $17,062 per year to care for an infant, according to the Economic Policy Institute. At the same time, child care workers nationwide are twice as likely to live in poverty as workers in other industries.

Warren’s argument for universal child care, though, goes far beyond addressing either problem. It is based on economist James Heckman’s research that investment in early childhood dramatically lowers social welfare costs and crime rates, while increasing tax revenue over a child’s lifetime.

Heckman analyzed two programs in particular before arriving at his findings. The first, the Perry Preschool program, demonstrated a return on investment of 7-to-10-percent per year in the form of “reduced costs in remedial education, health and criminal justice system expenditures.” The second, the Abecedarian/CARE programs, showed an even bigger return on investment — an estimated 13.7 percent per child, per year — when infants were enrolled in programs shortly after birth rather than delaying enrollment until age three.

Cornell University professor Maria Fitzpatrick, who has studied early childhood education policies, says that the “returns on investment” that economists talk about come in all forms — from higher test scores, to lower pregnancy rates, increased earning potential and long-term employment prospects, “particularly children from low-income and rural areas.”

Making the program universal is particularly compelling, Fitzpatrick says, “because we do have some evidence that a universal program is even more likely to have benefits than a targeted program, and in part that’s driven probably by peer effects across children — there are benefits, for example, for children from different backgrounds spending time together in daycare and preschool classes.

Warren’s proposal would take lessons from both studies, not only rolling out early childhood education nationwide, but offering child care programs, too. Under the program, which the campaign estimates would cost $70 billion per year, the federal government work offering funding to local providers, who would have to meet new federal standards. Those existing child care providers would, in turn, make their services available on a sliding income scale.

Under Warren’s plan, the poorest Americans would pay nothing for child care, and costs for the highest earners would be capped at 7 percent of their income, regardless of their number of children. (Right now, the cost to care for one child accounts for between 9 and 36 percent of a family’s income, a figure that can skyrocket to as high as 91 percent in a single parent household.) Warren says she would finance the program with money raised from the proposed wealth tax she’s calling “Ultra-Millionaires Tax.”

It’s a different approach to the same problem that President Donald Trump’s daughter Ivanka lobbied Congress to address in 2017. Ivanka Trump argued for expanding tax credits to parents — a proposal that would lower costs for wealthy families, but do little to address the costs shouldered by the 35 percent of Americans who had no tax liability.

Warren debuted her proposal the same morning that fellow-traveler Sen. Bernie Sanders (I-VT) announced his candidacy for president in 2020. Sanders in 2016 popularized a plan that would offer free college tuition to all Americans, a concept that been embraced by other candidates, including Sen. Kamala Harris (D-CA), this year. Universal child care has attracted less attention, despite the fact that child care costs more than in-state college tuition in 33 states and the District of Columbia.