- The Senate has passed $1 trillion in infrastructure spending, but Democrats want to spend billions more on families.
- The party's $3.5 trillion budget resolution tackles the climate crisis and tax cuts for lower-earning Americans.
- Families would get universal pre-K, affordable childcare, and paid leave under the resolution.
- See more stories on Insider's business page.
With the ink barely dry on the Senate's bipartisan $1 trillion infrastructure deal, Democrats are already laying out their ambitious, party-line $3.5 trillion follow-up package. They approved a spending blueprint early Wednesday morning, kicking off efforts to draft a new bill.
One major beneficiary: Families across America, who would see expanded direct payments in the form of tax credits, greater access to childcare, and paid leave, among other things. The resolution comes as issues like childcare and paid leave generated increased attention during a pandemic that sent kids home and parents scrambling.
"For so long, these were seen as sort of marginal issues or women's issues or nice to have, but I think COVID has demonstrated that when we don't have care policies in place, we end up with labor shortages," Vicki Shabo, a paid leave expert at think tank New America, told Insider.
The package stands to be the government's biggest investment in the American family in a generation since Richard Nixon vetoed a similar package exactly 50 years ago, and to transform the relationship between families and the federal government. Here's what Biden and Democratic lawmakers are proposing for American families.
Expanded child tax credit
Democrats included a one-year expansion of the child tax credit in the March stimulus law, turning it into an emergency cash benefit and allowing families who don't typically file taxes to tap into it.
Starting last month, families were eligible to receive a $300 monthly benefit per child age 5 and under, amounting to $3,600 this year. The measure provides $250 each month per kid age 6 and 17, totaling $3,000. Half of the benefit will come as a tax refund.
Democrats want to renew the child allowance until at least 2025, bringing the US somewhat in line with other wealthy nations like Denmark and France that provide a similar benefit. Some Democratic moderates may balk at the hefty price tag or demand to cut who is eligible.
Universal pre-K and tuition-free community college
Democrats are seeking to add four years to public education in the US by creating a universal pre-K program for 3- and 4-year-olds and making community college tuition-free, in a plan modeled on one introduced by Sen. Patty Murray of Washington.
The Biden administration projected that expanding Pre-K would benefit 5 million children.
The creation of tuition-free community college would go in tandem with increasing federal Pell grants and new spending on historically Black colleges and universities.
As the US faces a childcare crisis, with mothers dropping out of the labor force over caregiving responsibilities and an ongoing worker shortage, Democrats want to put money behind creating affordable and accessible childcare.
Sen. Bernie Sanders said that the resolution would ensure that no working family spends more than 7% of their income on childcare, which seems to be modeled on childcare legislation introduced by Sen. Murray and Rep. Bobby Scott. The left-leaning Center for American Progress found that that legislation would make 5 million low-income children eligible for free childcare.
The White House cited a NBER paper that found every dollar put towards childcare programs for low-income children yielded benefits of around $7.30 through increased wages and improved health outcomes.
Paid medical and family leave
"This would bring us closer to where many of our peer countries are, and establish for the first time both a policy and cultural standard that says you should be able to both be a worker and a caregiver, and you should be able to provide and receive care without jeopardizing your income or your job," Shabo said.
Currently, families can receive unpaid leave through the Family and Medical Leave Act (FMLA); for paid leave, they're at the mercy of employers' benefits.
"It would be a national tragedy if this package isn't able to make it through. We have the wind at our backs. We have the evidence that clearly shows we need these policies," Shabo said.