■ White House officials called the nation’s child care system broken.
Yellen calls system a ‘broken market’
The U.S. Treasury Department issued a report Wednesday that detailed the high price and low wages for child care.
Vice President Kamala Harris and Treasury Secretary Janet Yellen presented the findings in remarks that drew on personal experiences. Harris recalled spending weekdays with Regina Shelton, who ran a child care center from her home while the vice president’s mother was in the lab researching breast cancer.
Yellen recalled posting a classified advertisement for a babysitter when she was returning to work 40 years ago as an economics professor after having given birth. Yellen and her husband, economist George Akerlof, decided to pay wages above the market rate in order to receive better care.
But Yellen emphasized that her experience is far from normal in the United States. The Treasury report draws attention to a troubling paradox in child care: It costs families too much money, yet the sector’s workers receive chronically low pay that undermines the quality of care.
“Child care is a textbook case of a broken market,” Yellen said.
The Biden administration says it can resolve these problems through a substantial increase in investment in young children.
It would cap child care expenses at 7 percent of a family’s income. Universal pre-school for 3- and 4-yearolds would be provided. Families with children under 13 could receive dependent care tax credits of $4,000 per child or $8,000 for two or more children.
The government would also fund child care centers to ensure workers can receive a living wage.
Another key element would be the expanded child tax credit, which is providing families with children under the age of 6 with $300 a month per child and $250 monthly for older children.