President Biden is set to use Wednesday’s primetime address to promote his American Families Plan, which would be a massive expansion of government programs to help with childcare, education and a number of other key provisions.
Details of the $1.8 trillion proposal were released by the White House in advance of Biden’s joint address to Congress, promising the legislation would “grow the middle class, expand the benefits of economic growth to all Americans, and leave the United States more competitive.”
Family leave and childcare
Biden’s proposal would provide $225 billion to create a paid family and sick leave program, providing funding for up to 12 weeks of time off by its 10th year. According to the White House, the benefit would “ensure workers receive partial wage replacement to take time to bond with a new child, care for a seriously ill loved one, deal with a loved one’s military deployment, find safety from sexual assault, stalking, or domestic violence, heal from their own serious illness, or take time to deal with the death of a loved one.”
A 2019 study of 41 countries by Pew found the United States ranking last in the amount of paid family leave offered to new parents. The U.S. has also seen a decline in birth rates that may have accelerated during the pandemic, according to an analysis from the Associated Press.
The plan proposes that low- and middle-income families would have to pay no more than 7 percent of their income toward care of children younger than 5. How this provision would work and how much it would cost have not yet been disclosed.
The plan would also raise wages for those who work in childcare. There would also be an increase in funding for nutritional programs for children, including the expansion of free lunch in schools.
As part of the American Rescue Plan, passed by Congress in March, the child tax credit was temporarily expanded for low- and middle-income families. As part of this new proposal, that credit would be extended through 2025. Single parents making up to $75,000 and joint filers making up to $150,000 would receive $3,600 per child under the age of 6 and $3,000 for children ages 6 to 17. The credit would be fully refundable, meaning those with the lowest incomes would receive the full benefit, and available in monthly payments.
The proposal would provide $200 billion for a universal pre-kindergarten program for children ages 3 and 4 along with $109 billion to provide two free years of community college. Both would be done via partnerships with states, which would have to pick up some of the bill (50 percent for the pre-K plan, 25 percent for the community college plan). The White House projects that the expanded pre-K program would save families an average of $13,000 per year.
Under Biden’s plan, the value of Pell Grants — which are used by lower-income Americans to help pay for college — would be increased, while money would also go into scholarships and development plans for educators, including helping teachers earn credentials in both special and bilingual education. Additionally, the legislation would create a $39 billion program to help subsidize tuition for historically black colleges and universities (HBCUs) for families making $125,000 or under.
Additionally, the plan would increase subsidies for premiums on the Affordable Care Act exchange, providing cheaper health insurance for some Americans. It would also provide $2 billion toward unemployment insurance systems for “modernization, equitable access, and fraud prevention” while calling on Congress to adjust the length and size of payments for those who’ve lost their jobs.
The Biden administration says that funding for the programs will come via a tax increase on wealthy Americans and investors. The White House has also proposed additional funding for the Internal Revenue Service to crack down on tax avoidance, with the administration estimating that an investment of $80 billion over 10 years could yield $700 billion in new revenue. Biden is not including an increase in the estate tax, reneging on a campaign promise.
Following March’s COVID-19 relief bill, Biden split a number of Democratic legislative priorities into two packages: the American Families Plan and the American Jobs Plan.
The American Jobs Plan, an infrastructure bill he rolled out last month, provided approximately $2 trillion in funding for roads, bridges, waterways, electrical grids, broadband internet expansion and care workers. While the plan enjoys broad popularity in recent polling, Republicans have signaled that they will oppose it in its current form.
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