Legislative task force correctly identifies the problem with childcare but they propose a non-solution
In an effort to address the childcare crisis, Minnesota legislators and early care and education advocates proposed creating a task force. Termed the “Great Start for All Minnesota Children,” the task force was signed into law by Gov. Tim Walz in 2021.
According to Minnesota Management and Budget (MMB),
The purpose of the Task Force was to develop a state plan to accomplish the goal for “all families to have access to affordable, high-quality early care and education that enriches, nurtures, and supports children and their families.
On February 1, this task force released a report outlining what the problem with childcare was and how to resolve it. Indeed, the report hits the nail on the head. The childcare market has a problem.
Those who need to acess early care and education often cannot afford to pay for it, and those who provide care and education are paid low wages.
In Minnesota, much like the rest of the country, high-quality affordable childcare is hard to find. To the extent that they can find and afford it, parents spend a huge chunk of their household income on childcare.
Why is such the case? Again, the task force seems to identify the problem well: strict regulations raise the price of providing care. And because parents cannot afford to pay these high prices, early childhood educators subsidize rates for them through low wages.
Though some settings for ECE are publicly funded (including some school-based settings and Head Start, and public dollars that provide assistance in affording care to low-income families), the ECE system is largely a private market. Private businesses in this field face a unique set of constraints on their costs and revenues (such as required group sizes and adult-to-child ratios for health, safety, and development), which lead to limited options for reducing the cost of providing care and education. Parents, who need care during the earliest years of their child’s life, are often at the beginning of their careers and have limited spending power, so are spending high percentages of their family budget on ECE. The high costs of providing ECE services often cannot be met by parents and families. This leads to early childhood educators effectively subsidizing rates for parents through low wages and leaves businesses operating on shaky foundations. As a result, the child care marketplace has not been able to meet the access needs of families.
But what’s the task force’s recommendation for this problem? More money. The Minnesota government needs to spend more money to improve childcare affordability and accessibility for everyone and to raise compensation for childcare workers.
But if regulations are the problem, how will increasing spending address the affordability issue? It won’t. As American Experiment research has shown time and again, spending money on early childhood programs does nothing to lower costs, it merely raises those costs and transfers them onto taxpayers.
The lack of affordable, high-quality childcare is indeed a problem. But more government money is a non-solution.