How American Politicians Abandoned Family Values for Tax Cuts and Debt Relief
Forty years ago, policymakers went out for a pack of smokes and a tax cut. They never came back.
In 2009, California Representative and future Republican House Majority Leader and dad Kevin McCarthy said that he was worried about the America he was building for his kids. “When I think of the future, I think of my 15-year-old son Connor and my 12-year-old daughter Meghan,” he said. “I worry about the future because your kids are as important to you as mine are to me.”
Less than ten years later, McCarthy led his party’s effort to cut the rescissions package, effectively killing funding for the Children’s Health Insurance Program, which insures 11 million American children and had previously been given bipartisan rubber-stamp treatment. Although the Senate ultimately rejected those cuts, McCarthy’s realpolitiking put the lives of thousands of kids in danger in service of paying down a national debt. McCarthy then voted to cut taxes.
Politicians on both sides of the aisle constantly pay rhetorical homage to the importance of American families, but few do anything to provide families, which is to say parents and children, with material support. Republicans tout family values and then prioritize tax cuts. Democrats say children are the future and do little to support them. Leaders seem to love kids in theory, but they are lousy babysitters. The 22 percent of Americans 18 or younger will benefit from only 9.4 percent of federal spending in 2019 while some 45 percent of the federal budget for the next decade will be dedicated to the elderly, who currently represent just 15 percent of the population. In the coming years, investment in children will drop to roughly 6.9 percent of the federal budget. To put that in perspective, in 2009 — close to the height of American spending on children — the United States spent 2.5 percent of GDP on programs for kids while Sweden spent 22.9 percent. Family values are not, it is fair to say, American political values.
Why hasn’t America changed its approach to investing in children in the face of data showing that investment in education programs, nutritional assistance, and subsidized higher education is linked to better outcomes and quality of life? Why haven’t American politicians lined up to support programs like paid family leave that are broadly popular with the electorate? The answer has to do with how the modern social safety net was woven in the wake of the World War II as Social Security and Medicaid came online to assist the impoverished elderly. These programs, which remain essential today, were built on the belief that population growth would hold steady or increase, guaranteeing a sufficient tax dollars for funding. That was true until the 1970s, when the Republican party consolidated power by slashing taxes. The national debt ballooned and Republicans reacted by cutting spending. Then Democrats reacted by promising not to raise taxes while promising to continue offering entitlements. Debt accrued over the following decades.
This vicious cycle all but eliminates any chance for further investment in American children. It won’t get better any time soon and American parents will, as such, remain singularly put upon — beset by high child care and health care costs that allow corporations to continue to conduct hard-nosed negotiations with parents who depend on them for access to healthcare and caregiving capital in the absence of meaningful government assistance. Today’s parents will work their butts off to prepare their kids to inherit debt and intractable political problems.
Eugene Steuerle, an expert at the Urban Institute, releases a yearly finance report on how kids fared in the federal budget and seeks to understand the problem in stark economic terms. Ten years from now, in 2028, he estimates the federal government will have about a trillion dollars more in revenue. Of that amount, some 150 percent has already been committed to growth in health spending, social security spending, and paying down interest on the national debt. “How do our children win out if all of the growth and revenue, and then that extra money, is already committed?” he asks. There’s a pause. There’s no good answer to this question.
“Children are losing,” he adds.
The problem is not with the programs that the federal government uses to help children, many of which are fundamentally sound. The problem is with the way they are funded. The budget spent on early childhood education is appropriated annually. The budgets for needs-based programs, including the Supplemental Nutrition Assistance Program, Medicaid, Temporary Assistance for Needy Families, Title 1 Funding for at-risk public schools, and the Adoption and Child-Care Tax Credits are as well. This effectively leads to these programs being treated as a lower priority. The poorest of poor parents receive roughly $3,000 in annual assistance, which is minimal in a global context, and working class families are left largely in the lurch as politicians fight over debt and Medicaid.
Why the long-term commitment to helping the elderly and the short-term commitment to helping the young? The obvious answer is that the elderly vote. Americans over 60 are 15 percent more likely to be registered to vote than their 18 to 30 year old counterparts and 100 percent more likely to vote than preschoolers. But the more trenchant point is that politicians cannot renege on the promise of Social Security or Medicaid without losing their jobs and believe that they cannot successfully run for high office promising to raise taxes. The American people won’t stand for it and, therefore, American parents must make do with less. This will continue to be the case for the foreseeable future as so-called “on-the-fly” supermajority rules require an unattainable two-thirds legislative votes to support changes to taxation. The last time that either political party held a supermajority in both houses was in 2009.
On the other hand, it is relatively easy to pass a tax cut. This allows legislators to cut budgets and fund programs while running up debt, but leaves them hamstrung when it comes to helping families. No determined politician has broken through this gridlock.
Partisan rancor also guarantees the underfunding of children’s programs. In the 1970s, Jude Wanniski, a conservative commentator and journalist, argued that Democrats had been the Santa Claus of social programs and public spending and that Republicans had to offer an attractive alternative. So the GOP became the Santa Claus of tax cuts. For forty years, elves have been paid in debt. And the problem is only exacerbated by the current political climate.
“Republicans keep deciding we’re going to keep the taxes too low to pay our bills,” says Steuerle. “That means that between the two parties, interest costs are rising quite dramatically. And children are just left out.”
The Trump tax bill of 2017 gave the richest Americans a two percent tax cut from 39.5 percent to 37 percent. This cut was offered by the a party that has long espoused “family values.” The corporate tax cuts also on offer haven’t led to booming wages for middle-class workers or greater investment in employer-based child-care programs.
Joan C. Williams, the founding director for the Center for WorkLife Law, says that tax cuts are just part of the problem. As taxes have gone done and child-oriented programs have stagnated, demands on parents from American corporations have increased. Modern workers are expected to be available at all times. Today’s working parents must beg their employers for understanding and pay care providers, who are more in demand than ever thanks to the dearth of government programs, through the nose.
“The Republican party may be the Santa Claus of tax cuts, but they are also virulently anti-workers rights and pro union busting,” says Williams. “In order to have proper family supports, you need three different buckets of things. First, you need social subsidies for things like family leave. Second, you need workers rights so that employers can’t constantly beat up the definition of what it takes to succeed. Third, you need anti-discrimination measures.” American parent can only count on one of those measures: anti-discrimination laws.
Those laws exist precisely because the private sector hasn’t been good on issues related to work-life balance. Though parental leave offerings in competitive fields (engineering, law) have become more significant over the last several years, most Americans can only fantasize about Silicon Valley-style benefits packages that still fall short of what is standard abroad. In Germany, moms take up to three years of family leave and companies are required to pay for 14 weeks of paid time off before and after childbirth. Even as New York’s state leave programs have proven successful and not particularly deleterious to business interests, a national program remains a fantasy — albeit one discussed rosily by the president’s daughter.
Millennials, a generation of 75 million that represents a quarter of the American population and two fifths of the working population, have entered prime babymaking years. Will they demand more? Will they vote for taxes and change? They may not have the choice. Despite the well-covered success of some young pols, there are perishingly few candidates with new ideas to support. Dr. Shauna L. Shames, author of Out of the Running: Why Millennials Reject Political Careers and Why It Matters, explains that millennials, even those who go to law and policy schools, may not choose to seek office. Why not? Fundraising and partisan acrimony. Campaign finance laws all but force non-incumbents to spend 70 hours a week fundraising, which is off-putting to many potential office seekers. And then there’s the fact that many smart, qualified millennials do not see politics as an effective means of seeking solutions.
They may be right.
The Child Care for Working Families Act proposed by Nancy Pelosi and Chuck Schumer in 2017 would have changed the way kids are cared for in the United States. The program sought to limit child care payments for working families to 7 percent of their income, increase wages for teachers, and invest in middle-class families. These are all popular ideas with the electorate, but the Child Care act has gone nowhere in the Congress or the House presumably because there’s no clear way for the government to pay for these social services without raising taxes. And that’s not going to happen.
To understand the peculiarity of the American predicament, it helps to look abroad. In Germany, the effective tax rate for top earners is 45 percent. In America, it’s 37 percent. But that’s not all. Citizens United, which allows corporations and wealthy individuals to bundle funding for candidates, have consolidated political power among those with access to capital. Corporations and wealthy individuals drawing salaries from corporations still benefit from a status quo that provides them with leverage over a population of workers.
“Private enterprise will not solve the child care problem. It has just made childcare enormously expensive and highly stratified, so that we get very poor child care for some people and very excellent child care and schooling for others.” says Shames.
The only way out is government intervention and that’s unlikely, especially in light of Americans’ individualistic attitudes about parenting.
“The last time I looked, kids were the poorest economic group in the United States. It’s because we have this ideology that having kids is a private frolic, similar to hang-gliding. Just as I am not going to pay for your hang-gliding, I can’t expect you to pay for my kids,” says Williams. “We don’t do social subsidies for family caregivers because we don’t do social subsidies for anything. That’s getting worse. Every single decade since the 1990’s, it’s gotten worse. That’s where we’ve been forever.”
This leads to some bizarre economic choices. A study funded by the highly conservative Koch brothers found that a “Medicare for All” program would be less expensive than the current system and offer healthcare protections for children, and wouldn’t leave parents dependent on insurance purchased through employers.
“People talk about the sticker shock of ‘Medicare-for-All.’ They do not talk about the sticker shock of the cost of our existing system,” said Alexandria Ocasio-Cortez, a millennial house Democrat. There is, in short, a cost associated with treating children like hobbies. Americans pay it every year and, by voting for tax-cut candidates, ensure that they will continue to do so going forward.
“To the extent that there’s going to be progress on this issue in the near future, it’s going to come from capitalism,” says Williams. But she adds that parents should not expect very much. The issue of declining or stagnant government support for American families is intractable. Politicians may have “Family Values,” but they stopped acting on them 40 years ago. Now, they don’t even seem capable of trying.
This article was originally published on