The Harris-Walz ticket closed a busy pre-convention week by outlining the elements of an economic plan it claims will ease the burden on lower- and middle-income families. While the plan’s imposition of national price controls on food got the most attention, it also devoted considerable resources to child tax credits (CTC), a subject that, oddly enough, has generally united both political parties for decades.
The core elements of the Democrats’ proposal would make permanent the American Rescue Plan’s increase in the CTC to $3,600 from its current $2,000, as well as create a tax credit of $6,000 in an infant’s first year of life. Credits like these have long raised hackles with business-oriented forces who doubt the value of provisions that elevate “human capital” over the tax cuts they traditionally prefer to promote investment in manufacturing plants and equipment.
Harris left many of the details off her release, including how the federal government, whose national debt now tops $35 trillion, will pay for a market basket of ideas that could add another $2 trillion to that debt over the next 10 years. This crushing dilemma is only increased by widespread recognition that birth rates around the world, including in the United States, are falling dramatically. Who exactly will pay down this spiraling debt is an even bigger question than how high that debt will go.
History helps only so far on this front. The child tax credit did not emerge in the 1990s as a uniquely conservative idea. While groups like Family Research Council embraced the CTC, many conservative allies resisted it for the reason cited above. Wall Street journalists opposed it. Pro-family voices favored an investment in families first and spent the first part of the 1990s fighting the Democrats’ plan to create a national, cradle-to-kindergarten child care system.
Return money to families with children, family groups argued, and let them, not Washington, D.C., decide whether to spend it on in-home or out-of-home care. Much evidence showed families preferred to maximize family time and permit parents to raise their children via a single income or flextime arrangements. Ultimately, pro-family forces won this family choice debate, aided by a landmark report from the bipartisan National Commission on Children in 1991 that endorsed the creation of a $1,000 credit for each child in America.
The report and its credit recommendation, which constituted 70% of its new proposals for spending on children, were endorsed by its chairman John D. Rockefeller, a stalwart Democrat, and Kay Coles James, a pro-family leader who would later work at FRC and helm the Heritage Foundation. The report even lamented, in language unthinkable for today’s progressive Democrats, the fact that schools are “too often silent on critical moral and ethical issues.”
Despite initial reluctance by GOP leaders, the child tax credit, aided by advocates like then FRC-President Gary Bauer and Focus on the Family Founder James C. Dobson, became the crown jewel of the 1994 Republican Contract with America. By then the credit itself was $500 per child and proposals had been added to begin easing the marriage penalty in the tax code and to create tax-favored American Dream Savings Accounts to provide middle-income relief.
As 1996 approached, the incumbent President Bill Clinton was anxious to maintain his middle-of-the-road political support and began to express openness to “Third Way” ideas in tax policy and welfare reform encouraged by his aide Dick Morris. The momentum was only increased when the 1994 mid-term election resulted in the Gingrich Revolution, a flood of eight new GOP senators and 54 new House members.
One fruit of this change was adoption of the child tax credit and other pro-family tax relief in 1997. Ever since, the basic credit has been politically secure and received bipartisan support. Debates have occurred over the size of the credit, ideas to make it refundable so that more of its benefits would flow to poor families who have no income tax liability, and phase-out ranges to concentrate benefits on lower- and middle-income families.
In one sense, the Harris-Walz proposal is squarely in the mainstream of thinking about family tax relief. The credit’s flexibility makes it far more appealing than an alternative approach, the Child and Dependent Care Tax Credit, that offsets costs for out-of-home child care. Conservatives have long asserted that the credit should follow the child, not the provider, and allow families to choose commercial or nonprofit services or to care for their children at home through single-income or flexible work-family arrangements. Government’s clumsy thumbs should not be on the scales.
But the Harris-Walz proposal prompts some questions regarding timeliness, fairness, and overall hostility to providers of alternatives for expectant families. The $6,000 credit for infants would delay support until nine months later than it is first needed — after a couple first finds out they are expecting. During remarks last Friday, Vice President Harris opined that the credit is needed for that “vital year of critical development for a child and the cost can really add up, especially for young parents who need to buy diapers and clothes and a car seat and so much else.”
But these expenses, and the cost of prenatal care and changes in health status, have compelled parenting advocates to develop the concept of the First 1,000 Days, that time from conception to the end of the 2nd year of life. Extensive studies in the literature underscore how this prenatal period, proceeding to the first 24 months postpartum, steers the whole of a child’s intellectual, emotional, and nutritional development.
Recognizing this truth, proponents of the child tax credit have proposed extending it prenatally. Senators Steve Daines (R-Mont.), Marco Rubio (R-Fla.), Cindy Hyde-Smith (R-Miss.), Tim Scott (R-S.C.), and others have introduced the Child Tax Credit for Pregnant Moms Act. A companion bill has been introduced in the House. As Daines writes, “Expecting parents begin providing and preparing for their child the minute they learn they’re having a baby — the Child Tax Credit should reflect the fact that unborn children are children too. From prenatal care to stocking up on baby supplies, this tax relief will help parents prepare for the arrival of their baby.”
The Harris-Walz credits offer no encouragement at all for the one million children who will not see the light of day thanks to their party’s obsessive focus on legal abortion until birth. Moreover, the Democratic ticket’s commendable rhetoric about an infant CTC puts in relief the ugliness of their party’s relentless attacks on pregnancy resource centers. These centers annually expend hundreds of millions of dollars — none of it a drain on the U.S. Treasury — to provide strollers, nutrition, prenatal care, housing, job counseling, cribs, car seats, and more to mothers in need.
History shows that actions like the CTC and pregnancy resource centers need not be exercises in partisanship. But Republicans, including current GOP aspirants for the White House and Congress, should not hesitate to point out the contradictions in the Democrats’ pro-family and pro-middle-income messaging. If you stand for children and for their healthy future, for a 2nd birthday celebration that began with love and attention in the womb, then stand for all the unborn and for the pregnancy resource centers that strive every day to help them.
Chuck Donovan is a veteran family policy analyst and former Executive Vice President of Family Research Council.
