Donald Trump made headlines this week when he became the first Republican presidential nominee ever to put forward plans to ensure paid maternity leave and tackle the high cost of childcare. But he was, of course, late to the party—Hillary Clinton was talking about paid leave back in 2007 and released her plans on these issues in January and May, respectively. Clinton’s plans are also more universal and progressive, and together they constitute an approach to these issues that will go much further in assisting working families.
Even so, neither candidate has offered the kind of policy design that will both adequately address the growing challenges working parents face and stand the test of time.
Let’s start with leave. Trump’s plan would guarantee new mothers six weeks of paid maternity leave, funneled through the existing unemployment insurance system, supposedly paid for by eliminating fraud. Setting aside whether the estimated $3 billion in fraud could cover these new benefits, the system itself is hardly ready to handle anything more than what it’s already tasked with. Many states don’t even have enough money in their coffers to cover unemployment needs if another recession hits. Plus, states run their own unemployment systems with federal funds; just as with Obamacare’s Medicaid expansion, they could decide to opt out of Trump’s maternity leave policy.
Then there’s the fact that he would only offer leave to new birth mothers. That means fathers, adoptive parents, and gay men would be left out, as well as those who need paid leave for serious medical reasons, such as caring for an elderly parent or recovering from a major surgery.
But even women could end up worse off. They are already more likely than men to take leave, and limiting paid leave to new mothers will exacerbate that. It means employers will, unfairly or no, start to see any woman of childbearing age as a risky investment, because they would be much more likely to take a long leave of absence. There is research to bear this out: Studies have found that when countries mandate more generous benefits for women than men, it can depress women’s wages and employment. On the other hand, when both men and women are given paid leave, men become more likely to take it. This, in turn, has been found to boost women’s incomes and jobs.
Clinton avoids all of these problems. Her leave program builds on the existing Family and Medical Leave Act, which offers unpaid leave to parents of both genders and those dealing with serious medical issues. She would also use the existing infrastructure for that program to disburse the paid benefits, a system that is already up and running and far more functional.
But her plan has its own design flaws. Democrats in Congress have introduced a bill that would set up a paid leave program as social insurance, levying a tax on all Americans and putting that money into a fund to pay out benefits, just as Social Security does. Clinton can’t adopt that plan because it would technically violate her pledge not to raise taxes on anyone making $250,000 or less. So instead, she proposes taxing the wealthy and using that money to pay for people’s paid leave benefits.
This is a very unusual design. Around the world, the vast majority of countries with paid leave have used a social insurance model; just ten have taken Clinton’s route and funded it with tax or general government revenue. That might be because social insurance is far more stable: It isn’t as vulnerable to the whims of legislative budget fights or fluctuating tax revenues.
It also gets buy-in from all Americans, rather than making paid leave seem like a niche benefit funded by a small slice of the population. Rich people shouldn’t be the only ones to fund paid family leave when parents, children, businesses, and the entire economy benefit from it. In Clinton’s model, it’s too easy to see leave as a “hand out” from one group to another, rather than something we all do together. If it were social insurance, just like Social Security and Medicare, people would have a sense of ownership and entitlement to benefits they contributed to, which would give the program an indefinite political shelf life.
Then there’s childcare. Trump’s plan would let families who make $500,000 or less fully deduct the cost of childcare from their taxes. Because many low-income families don’t have a federal income tax obligation to deduct from, he also throws in an expansion of the existing Earned Income Tax Credit, worth up to $1,200.
Parents can certainly use all the help they can get in affording childcare. The costs have increased rapidly over recent decades, and now reach into the tens of thousands per year. But Trump’s proposal is tilted toward those with the most means, and would offer a lot less to moderate- and low-income families who struggle the most. According to Harry Stein, an economist with the Center for American Progress, those making the highest income would get a tax break worth 2.64 times the one that a family making $60,000 would see.
Giving families help once a year at tax time also does them little good when the childcare bill comes monthly (or even weekly and daily). While he proposes tax-free savings accounts with federal matches for low-income families, which could be used to front the costs throughout the year, those same families already struggle to save money.
Clinton’s plan stands out as being far more progressive. Although she hasn’t enumerated all the details, she says she would use government spending and tax breaks to make sure that no family pays more than 10 percent of its income on childcare. That would make sure help is evenly spread between the rich and the poor.
She would also address the other half of the childcare crisis: the scant availability and quality of care even for those who can afford it. She pledges to increase providers’ pay as a way for the industry to attract skilled workers.
Clinton also couples her plans with a call for universal preschool. And that proposal exposes how much further she could go. The United States actually used to have a national, universal, government-run, and government-funded childcare system. It was created during World War II as a way to get mothers into the factories, and it had huge benefits for women’s earnings, their children’s futures, and the economy. The government still runs a high-quality, affordable daycare system through the Department of Defense. If Clinton really wanted to end the childcare crisis, in which parents can’t find or afford quality care and workers are still living in poverty, she should think even bigger.
It may seem like splitting hairs to talk about policy flaws when Americans still go without any guarantee of paid time off for a new child or a serious illness, while families are spending more on childcare than rent, food, or even sometimes college tuition. Nor could anyone pretend that the significant differences between Trump’s and Clinton’s plans don’t matter or make them equally faulty. Clinton would go much further toward easing the burden on all parents—mothers and fathers in all income brackets. And hers would likely be more easily implemented.
But policy design matters. The childcare crisis is acute, and offering partial help will allow it to keep growing. If the country finally gets paid leave, only to see it wither on the vine, it’ll be one step forward and two steps back.