You May Be Shocked by the Amount the U.S. Will Pay for Not Passing the American Families Plan

Little kids having fun in daycare play with instruments.

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Change is scary, but doing nothing is expensive.

Important points

  • The failure of the American Families Plan is expected to cost the US $57 billion annually.
  • For every $1 invested in early childhood education, there is a return of $4 to $9 over a child’s life.

For decades, parents have faced a pressing question: How do I pay for childcare so I can work? The average cost of full-time child care in the US is over $11,000 per year. In Washington DC, full-time infant care costs on average more than $24,000. If a parent doesn’t have a six-figure income, it’s hard to imagine how they could handle those expenses.

According to the US Bureau of Labor Statistics, the median income for a woman in the US is $916 a week, or just under $48,000 a year. For men, it’s a little less than $1,100 a week, or about $57,000. After paying taxes, contributing to a retirement fund (if they are able), and paying the monthly bills, there is little left in the bank account to pay for daycare. Despite this, millions of parents are trying to make it work.

Which passage of the American Families Plan would provide

Not to be confused with the recently passed, slimmed-down Inflation Reduction Act, the American Families Plan is designed to help Americans care for loved ones. Here are some of the ways parents and children would benefit:

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  • Three and four year olds would get free, universal Pre-K
  • A national paid family and sick leave program would offer workers up to 80% wage replacement for 12 weeks. That is, if a child or close relative is seriously ill, you are ill or are struggling with the death of a loved one, you are entitled to special leave.
  • A tiered system would ensure that most families spend no more than 7% of their income caring for children under the age of 5.

If it fails

According to ReadyNation and the Council for a Strong America, failure to implement reforms will cost the United States an estimated $57 billion a year in lost revenue, productivity and revenue.

Almost two-thirds of parents who face childcare problems report leaving work early. More than 50% report being distracted or missing entire workdays. A whopping 86% of parents reported that childcare issues negatively impacted their efforts or time at work.

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It’s not that parents don’t want to work. It’s difficult to focus on what they’re doing when they don’t have a reliable and safe daycare available.

In an op-ed for Ms., US Rep. Jackie Speier writes that for every $1 invested in early childhood education, $4 to $9 returns to society over the course of a child’s life.

The resistance is fierce

Not a single Republican lawmaker supports the American Families Plan, and conservative news organizations have consistently condemned it. Dave Ramsey’s Blog, Ramsey solutions, laments that the plan will raise taxes for the rich. Ramsey fears families earning $400,000 or more will see a tax hike. He (or whoever writes his articles) also denounces the fact that people making more than $1 million annually could see their capital gains tax rate jump to 39.6% (which, according to the Tax Foundation, is slightly lower than 1976 to 1978). ).

Other countries are proving it’s possible

The GOP has taken to labeling those who propose to help poor and middle-class families as “socialists”. Trouble is, it’s not true. Check out a non-exhaustive list of countries that pay for extended paid family leave, early childhood education and child care.

  • Norway
  • Finland
  • Germany
  • Canada
  • Denmark
  • Sweden
  • Poland
  • France
  • Luxembourg
  • Belgium
  • Austria
  • Ireland
  • Netherlands
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Are taxes higher in some of these countries? Yes, but children have access to the care and education they need to become an active part of society. The same would be possible for American families – if only the right support were there.

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