Democrats are in the thick of it.
After coalescing to push through pandemic relief on party-line votes at the beginning of President Biden’s term, they’re now trying to guide two different infrastructure packages through Congress. One smaller bill is the product of bipartisan Senate negotiations and would address mostly so-called hard infrastructure, like bridges and rail. A larger, Democrats-only package would spend $3.5 trillion over 10 years on supposedly “soft” investments, like universal preschool, paid family leave, an expanded child tax credit and elder care — areas of our economic life that have gone largely unaddressed for decades.
Process aside, the biggest sticking point between moderate Democrats and the rest of the party on the larger bill seems to be the dollar figure. After reviewing Senate Democrats’ policy outline in late July, Senator Kyrsten Sinema had this to say: “While I will support beginning this process, I do not support a bill that costs $3.5 trillion.” Her fellow Democrat Senator Joe Manchin has gotten more specific, saying he won’t vote for a $3.5 trillion package, nor anything that goes above his own arbitrary cutoff of $1.5 trillion.
Republicans, unsurprisingly, have taken a more extreme tone. “You’re spending money like drunken sailors,” said Senator Lindsey Graham, accusing Democrats of “putting in motion a government that nobody’s grandchild can ever afford to pay.” Senator Mitch McConnell, the Republican minority leader, called it a “reckless taxing and spending spree” that’s “like nothing we’ve seen.”
Focusing on the amount of money at play instead of discussing what it would be spent on makes absolutely no sense.
“Instead of thinking about how much it costs, we should be asking, what are we getting?” Betsey Stevenson, an economist at the University of Michigan and a member of the Council of Economic Advisers under President Barack Obama, told me. “We should stop asking what’s the price tag and start asking, what’s the value?”
The American people deserve a political debate that’s not almost entirely focused on the price tag. We should be arguing about where the money would go. You wouldn’t know it from the political conversation, but the soft investments would be for things that would pay dividends in the future and create a more efficient economy and a more just society, helping us rejoin our international peers when it comes to supporting families and workers.
Voters, it turns out, are pretty unfazed by the multitrillion-dollar figure. In a poll conducted for HuffPost by Data for Progress, Americans offered the same amount of overwhelming support for an infrastructure package that invests in health care, child care, education and clean energy whether they were told it would cost $1.5 trillion, $2.5 trillion or the $3.5 trillion Democrats have been targeting. Voters support all three by a roughly two-to-one majority.
Part of the reason is that these numbers are incomprehensible. Trillions of dollars have no relevance to our daily lives and are hard to fathom.
But voters may also be picking up on what’s really important in a way that politicians aren’t. The dollar figure doesn’t ultimately matter if we’re spending the money on the right things. And the failure to make some of these investments comes with its own cost.
The $3.5 trillion plan is jam-packed with thoughtful investments. Take early childhood. There are now entire bodies of work showing huge returns to spending money on high-quality preschool. One study that followed low-income children who were enrolled in high-quality preschool found that such investments generate $9 in benefits for every dollar spent — an astounding return. While that study focused on one particular preschool in Ypsilanti, Mich., that wasn’t available to all children, a study that looked at universal preschool in Boston found similar results.
Those figures also don’t take into account the impact that investing in more high-quality care settings for children has on parents. A study of Washington, D.C.’s universal preschool program found that it increased the labor force participation of mothers with young children by 10 percentage points.
There are also huge returns for cash payments to parents along the lines of an expansion of the child tax credit, which Democrats have proposed doing through 2025 in their larger infrastructure package. A recent analysis found that if the country were to spend $100 billion a year on a more generous and widespread credit, the country would reap nearly eight times that cost in rewards gained from improved health, education, earnings and longevity. “That’s an incredible investment,” Irwin Garfinkel, an economist at Columbia University who was one of the authors of the analysis, told me. “It’s not just a compassionate thing to do, it’s a wise investment.”
It’s true that these kinds of benefits can take a while to materialize and may not be easily felt by every voter immediately. They are about a “theoretical greater good and productivity, way off in the future,” said Nancy Folbre, an economist at the University of Massachusetts Amherst. But that doesn’t make them less real or important.
Some programs may be less about the return we can expect to wring out of money spent than they are about the society we want to build and inhabit together. We provide all children a guarantee of education for ages 6 through 18. Why wouldn’t we also want equal access for children ages 3 to 5? Paid family leave has been shown to keep parents attached to their jobs and the labor force, but it also improves babies’ well-being and allows parents to bond with and care for their children without being forced back to work weeks into babies’ lives.
Care for the elderly may not be a traditional investment at all. “Treating older people better is not going to make them more productive,” Dr. Stevenson pointed out. It may help unpaid family caregivers juggle those responsibilities while working remunerative paid jobs, as well as attract more people to work as health aides, a role for which the demand far outpaces supply.
But what it’s really about is how we believe the elderly should be treated. Social Security, for example, was not created as an investment in the productivity of our economy, but as a promise to the aged that we wouldn’t abandon them to destitution when they could no longer work. What other promises do we owe the elderly, and how do we each want to live out the end of our lives?
The numbers under discussion are also big because we’ve got a lot of lost ground to make up. Among developed countries, the United States is nearly dead last in how much we spend, as a percentage of gross domestic product, on early childhood care and education. We’re the only advanced, industrialized country that hasn’t mandated paid family leave. Most others have child allowances. “Ramping up to something that looks like what other developed countries do, it sounds like a lot of money,” Dr. Stevenson said.
The question is not whether we can afford to spend this money. “Of course we can afford it,” Dr. Stevenson said. The risk of this spending leading to an immediate and unsustainable spike in inflation, as Senator Manchin has warned, is also a chimera: The money would take years to flow out to child care providers, community college students and home health aide agencies. Democrats have come up with an array of ways to cover the cost with tax increases and other revenue raisers. And their spending priorities are all about making American life less expensive, which would actually work against inflationary pressures.
The question, then, is where to spend our resources. Democrats have already begun arguing with themselves — proposing to whittle down investments in home health care and paid family leave — in an effort to fit their priorities into the smaller box being forced on them by Senators Manchin and Sinema.
Yet Mr. Manchin has said himself that his ceiling — how much money he’d be willing to vote for — is based on “the need of the American people.” He told CNN recently that he’s focused on one question: “What does it take now to meet the urgent needs that we have that we haven’t already met?”
That’s the question that Democrats should be debating, not what randomly picked number is right and how to squeeze everything into that tiny window. If Mr. Manchin truly considered what other Democrats were proposing, he would realize that these are all urgent problems that have gone without a solution for far too long. Yes, it will take a lot of money to create a more efficient and equitable economy. But that doesn’t mean it isn’t worth doing.
Bryce Covert (@brycecovert) is an independent journalist who focuses on the economy, with an emphasis on policies that affect workers and families.
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