The Most Underrated Topic Of The U.S. Elections: Childcare

–Analysis–

NEW YORK — It was a case that shocked New Yorkers: a 22-month-old boy died from opioid fentanyl and four other children suffered severe poisoning. As it turned out, a drug dealer in the Bronx was using the daycare center that his wife ran in the basement as a warehouse for his business. To pack his wares, he used the same spoons that were later used to feed the toddlers. He was arrested September last year, and has now been sentenced to 45 years in prison. The wife is awaiting sentencing.

The case highlighted the fears of those who drop their children off every day at facilities that are — hopefully — not drug dens, but are often problematic. The local news site NYCity News analyzed reports from the responsible authority from 2022 and came to the shocking conclusion that serious violations were discovered at one in ten daycare centers inspected.

Among the violations: dilapidated premises, rats, mice and other vermin, caregivers with criminal records who should not have been employed in such a facility. Some facilities were closed, only to be reopened by the operators — and again become the target of the inspectors.

How can parents leave their children there? In very few cases can they choose. Childcare options, as I know from my own experience, are scarce in New York. And expensive. So scarce and so expensive that even wealthy families with two incomes have problems getting and financing them. On average, childcare costs around $20,000 a year. But more than $40,000 is not uncommon.

Parental burden

A solution often put forward by people who do not live in the city: Just have one parent stay at home then. But it takes either a very good salary — hedge fund manager or top manager at a bank — or two earners to make ends meet in New York.

The rent for a normal two-bedroom apartment currently amounts to ,000 a year. If you now compare the annual cost of rent and childcare with another statistic, namely the annual median household income, which in New York City is just over ,000, it takes little imagination to imagine why so many New Yorkers are constantly stressed. Stress that many no longer want to put up with: The city is experiencing an exodus of families with children. With them disappear tax revenues, economic power, but also ideas and talent.

The strained financial situation of Nevada families could decide Tuesday’s election

But anyone who believes that New York is the center of the childcare crisis is mistaken. It’s the state of Nevada. There, the strained financial situation of many families could decide Tuesday’s election. The Washington Post recently reported on a married couple, both high school teachers in Reno, a city of 280,000. The dual earners had to pay ,700 a month for preschool for their three-year-old twins and after-school care for their eight-year-old son. They were unable to cover this with their regular salaries.

That’s why they took on new home loans, added side jobs as soccer coaches and bartenders and accumulated credit card debt, the newspaper reported. Another couple was so desperate that they hired the dog sitter who had been walking their German shepherd to look after their three-month-old daughter instead (it didn’t work out, the Post reported).

… and on the economy

In Nevada, the hospitality and entertainment industries are the most important employers. Those who work there often do so in the evenings and at night, and often enough for minimum wage. This makes the issue of childcare even more pressing. If you don’t have any relatives to leave the little ones with, you need facilities that are open at these times.

This limits the number of places even further – and is more expensive than a regular childcare place. Nevada is home to around 215,000 children under the age of five, over 60% of whom have both parents working, according to an analysis by the First Five Years Fund, an organization dedicated to supporting children in their early years. Yet there are only 686 licensed childcare facilities.

Mothers in particular decide to give up their jobs in this predicament. It is probably no coincidence that the state has the highest unemployment rate at 5.6% (only Washington, D.C. has a higher rate). However, leaving the workforce usually has long-lasting negative effects, for example on retirement provisions and career advancement, which would open up better earning opportunities.

And the loss is not limited to those affected. According to calculations by the First Five Years Fund, the lack of affordable childcare costs Nevada’s economy around billion a year in economic output. Across the U.S., the annual economic losses due to the childcare crisis amount to 2 billion.

Harris and Vance solutions

But why are childcare places so expensive? It is certainly not due to the pay of the childcare workers – they are still usually women in the profession. In New York, a quarter of employees live in poverty. In Nevada, their average annual salary is 28,000 dollars – just over a third of the median household income in the state.

So why is that? Daycare centers still have high wage costs because the prescribed childcare ratio – i.e. how many caregivers there must be per child – is high. Then there are the rents for the premises, which are rarely located in a cheaper commercial area, but in residential areas where it is more expensive.

As a result, it is a business model with many constraints, high fixed costs and slim to no margins. During the pandemic, there was billion in aid from Washington. Since this expired at the end of last year, more and more daycare centers are closing.

Harris promises a tax credit.

After all, politicians have now discovered the issue. Kamala Harris promises more resources to help families, including a tax credit of ,000 for the first year of life. She wants to introduce a cap that sets the share of childcare costs in a family’s expenditure at seven percent. How she intends to implement this in concrete terms is, however, vague.

Some Republicans have also realized that the issue should probably be put high on the agenda, but not all are convinced. J. D. Vance, the Republican vice-presidential candidate called on grandparents to look after their grandchildren as a solution. He also wants to raise the tax credit for families with children to ,000.

Donald Trump himself merely stated during an appearance that childcare is “something we have to have in our country.” Joe Biden’s idea, which failed to pass in Congress, of declaring childcare and nursing care to be “social infrastructure” and promoting them in the same way as highways, ports and bridges seems to have been forgotten.

That would be a missed opportunity. Children may not have a vote in Tuesday’s election, but their parents do.