WASHINGTON (Reuters) - U.S. Senator Elizabeth Warren, a Democrat running for president, on Tuesday proposed a universal childcare program, paid for by a tax on high-net-worth individuals, to help families unable to find affordable care.
The program would be funded largely by the federal government and would use existing childcare facilities and in-home providers.
The proposed tax would apply to individuals with a net worth of $50 million or higher, which the senator from Massachusetts has dubbed the “Ultra-Millionare Tax.” Her campaign estimates the tax would generate $2.75 trillion in government revenue in 10 years.
“In the wealthiest country on the planet, access to affordable and high-quality child care and early education should be a right, not a privilege reserved for the rich,” Warren said in an online post explaining her proposal.
Warren is vying for the Democratic Party’s presidential nomination, hoping to challenge Republican President Donald Trump in the November 2020 election. The Democratic field has grown rapidly, pitting candidates like Warren in the party’s more liberal wing against moderates, who may be more reluctant to back expansive new federal programs.
Republicans are likely to criticize her proposal as being too expensive and dependent on a new tax that would harm the economy. Republicans have said childcare programs should be driven by the states, and not imposed by the federal government.
U.S. states generally offer public education beginning around age 5. There are no other public programs open to all children, and the average family pays thousands of dollars for day care. Programs like the federal government’s Head Start make preschool available to children from poor families.
Warren is not proposing the creation of a national school network, but using existing childcare options and then adding more.
Under her proposal, the cost of childcare would depend on a family’s income. Families that make 200 percent of the federal poverty line - currently about $50,000 or less for a family of four - would get childcare for free. For those who make more, their payments would be capped at 7 percent of income.
For example, according to Warren’s campaign, a family of four making $125,000 a year would pay no more than $8,750 a year for childcare. She compared that with the cost faced by a family in New Hampshire, which currently would pay about $21,000 a year for care for two children.
The program would not be mandatory, so families that opt to have a parent remain home and provide childcare could continue to do so.
Reporting by Ginger Gibson; editing by Jonathan Oatis