Indiscriminate Budget Cuts at What Toll?Posted February 2nd, 2011 by Hannah Matthews
The recent House proposal to slash domestic spending to 2008 levels would mean millions lost in funding for early childhood programs.
It’s easy to give short shrift to this number when discussing it broadly and in the abstract. After all, there is wide agreement that balance needs to be restored to the federal budget. President Obama has called for a five-year freeze in domestic, non-defense discretionary spending and states are grappling with budget shortfalls and considering across the board cuts, including human services.
But when discussing balancing the budget and cutting programs, we shouldn’t be contented to talk about it abstractly and across the board. Human services cuts have real impact on individual families’ ability to secure all they need for their children to thrive.
More specifically, cuts to early childhood programs have implications for short- and long-term child and family well-being. At CLASP, we analyzed what would happen to child care funding, and the families that depend on these services, if the House plan moves forward. But that analysis seemed insufficient. We wanted to dig deeper and consider the impact on an individual family. We mapped out what would happen to a fictional family of three in Toledo, Ohio, with a household income of $27,000 per year, less than 150 percent of the current federal poverty level. If this family were lucky enough to obtain a subsidy, they would pay $200 a month for child care. Based on data from the National Association for Child Care Resource and Referral Agencies (NACCRRA), monthly costs for full-time care for an infant in Ohio average around $685. Without the subsidy, this family would have an increase of nearly $500 a month in child care expenses—more than three times what they were paying previously.
According to researchers at the Economic Policy Institute, a family of three in Toledo in 2008 required an annual income of $32,058 just to make ends meet and pay for the basics such as food, housing, child care and other necessary expenses. This means our illustrative family would fall more than $5,000 short.
Such a family has several choices—none of them easy. The family may go into debt or make untenable choices in their household budgets, for example, choosing between paying for child care or paying for rent. The family may put their child in lower-quality, less stable child care. Or a parent could lose their job if they are unable to find affordable, reliable child care. Some families would have to turn to welfare.
But the costs go beyond our simple math.
For the family that falls on public assistance, or loses their job, there is a significant cost to the state. The family may be eligible for cash assistance. They may seek a housing voucher if they are unable to maintain their rent. They may depend on food stamps, or SNAP benefits, to eat.
And there are less visible costs as well.
Without assistance to meet the high costs of child care, parents may be forced to leave children in child care settings that at best do not have the resources to provide adequate stimulation and foster healthy development and at worst are not even safe environments. The child may experience any number of negative impacts. As the family plunges deeper into debt or poverty, their household has fewer resources to commit to their young child; poverty itself is a predictor of negative child outcomes.
We know that society bares a large cost burden for children not equipped to succeed in life, including lowered earnings and productivity, expenditures in the criminal justice system, and so on. As this graphic from Child Care Links in California unmistakably shows, the societal impacts pile up.
Decades of research show that children benefit from access to high‐quality child care, improving the odds in particular for low‐income children, and helping build solid foundations for future learning and success in life. Much has been written about the return on investment for quality early childhood services. For every dollar invested, economists have argued that the public may receive $7 or $8 or $12 back in return.
Unless policymakers soon heed this research, we may soon be asking, what is the return on disinvestment? For every dollar we take away from a struggling family, how much do we plunge our children, our families, and our country further into debt and exacerbate poverty?
As our state and federal policymakers move forward and begin weighing how to balance budgets, they must also consider the sweeping implications for human services cuts—and that, beyond the numbers and the fictitious scenarios, there are real children and families whose lives will be affected.