$200 will get you $65

If you are not scared yet, you should be.

President Biden’s $1.8 trillion American Family Plan to help families creates wasteful spending.  

“President Joe Biden will call for free preschool for all three- and four-year-old children, a $200 billion investment to be rolled out as part of his sweeping American Families Plan being unveiled Wednesday in a joint address to Congress.

The administration said the historic investment would benefit 5 million children and save the average family $13,000. It calls for providing federal funds to help the states offer preschool, with teachers and other employees earning $15 an hour.”

The plan will provide free preschool to all 3 and 4 year olds.  The first thing the spending will do is increase the size and scope of existing programs.  More money will be poured into existing programs, duplicate programs will be created, and more families will be served by the expansion of benefits.  There is no political will to fight it so we can conclude, the federal government is getting bigger.

Maybe the President should learn from the city of
Vancouver, British Columbia. The city gave the cash equivalent of the benefit, eliminating the administration of a program, in the form of a debit card.  It was then up to the individual to find the services that best suited them.  At least the size of the federal government would decrease, as less administration is needed.  It’s a simple process:  Determine how much you want to spend, define your target audience and send them a debit card. What happens after that, is up to them.

Which is puzzling about Biden’s plan for free childcare, his number don’t add up.  The program will cost $200 billion to help 5 million children and would save an average family $13,000. At most there are 5 million families being served.  The average family will save $13,000.  So, the total benefit being realized is $65 billion ($13,000/family x 5 million families).  Where is the other $135 billion going? 

It calls for providing federal funds to help the states offer preschool, with teachers and other employees earning $15 an hour.”

The rest of the money will go to meet the increased demand created by giving preschool care to everyone who qualifies. It will cost $135 billion to fund state preschools and pay those employees at least $15 an hour. Why would you spend $135 billion to give away $65 billion in benefit?

I might be wrong, but I think it would be more efficient to identify the families that qualify, split the money evenly and send them a check than any other means of distribution. Allow famlies the freedom to pursue any childcare alternative they want, instead of being forced into the state sponsorship system.

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