Home > News > Build Back Better offers pre-K and child-care funding. States might not sign on.
164 views 8 min 0 Comment

Build Back Better offers pre-K and child-care funding. States might not sign on.

These three things help policies succeed

- December 15, 2021

“A game changer for families and our economy.” That’s how, several months ago, President Biden described his proposals to create a universal prekindergarten program and to offer an unprecedented federal subsidy for the purchase of child care. But the devil is in the details.

That’s because these proposals — both contained in the current Build Back Better budget reconciliation package — hinge entirely on state cooperation. Republicans control most states — and many reportedly will refuse to accept the funds, as they have refused to implement social services in the past.

Our book “Obamacare Wars” tracks the difficulties of implementing federal-state programs in an age of hyperpartisan politics. Our evidence suggests that the success of Biden’s child-care and prekindergarten initiatives will hinge not only on the character of politics in the 50 states, but also on how the law organizes and rewards state cooperation. If the ACA was any indication, BBB’s provisions will face obstacles in many states.

Why public support alone won’t save Biden’s plans in red states

One thing Biden’s plans might seem to have going for them is public support. A May 2021 Civiqs poll found that 61 percent of Americans support “providing free kindergarten for all three and four year olds.” A September 2020 First Five Years Fund poll found that 84 percent agreed that “high-quality, affordable child care for families with young children is an essential service — just like health care and education.”

Most Americans want Congress to support childcare and eldercare, our research finds — even many Republicans

But looking at these polls in isolation can be misleading. While many ACA features were popular when polled as individual reforms, public opinion on the law overall remained underwater throughout Obama’s presidency, thanks largely to Republican efforts. So far, Americans’ attitudes toward the Build Back Better package appear similarly polarized by party, with 80 percent of Democrats supporting the law and 71 percent of Republicans opposing it. Republican state leaders are likely to use that polarized opinion to refuse to take up the new programs.

Federal incentives can encourage states to join

Yet even when state leaders do say they support a policy in advance, putting it into practice can be difficult, especially if the law includes roadblocks.

One roadblock is inadequate state funding. Whether states adopt a program depends on what incentives the federal government is offering. The ACA’s Medicaid expansion, which expanded health-care coverage to individuals and families living up to 138 percent of the Federal Poverty Level, came with powerful fiscal incentives like 100 percent federal financing for the first three years and 90 percent in each of the following years, making it a “good deal” for the states. These explain why even some red states, initially hostile, have now signed on to the expansion, bringing the number of participating states from 28 in the ACA’s first year to 38 today.

BBB does offer states significant incentives to create child-care programs — including providing 95 percent federal financing of direct child-care services for the first three years of full program implementation. By contrast, the prekindergarten program begins with 100 percent federal financing, but ultimately tapers off to a 63 percent match by 2027, far lower than the Medicaid expansion’s matching rate.

Moreover, whereas Medicaid expansion lasts permanently, Democrats designed both the child-care and pre-K provisions legislation to end in 2027. Whether this sunset date was a fiscal “gimmick,” designed to hold down the Congressional Budget Office price tag, Republican state officials will be able to cite uncertain federal support for the programs as one reason to turn down the money. Indeed, some Republican state officials have already made this argument.

Some requirements discourage states from getting involved

The second roadblock comes if states have to pass laws creating new agencies or structures to carry out the policy. That’s especially difficult if the new agency has been framed in highly partisan terms. For instance, with the ACA, many GOP-controlled states simply decided not to create their own state health insurance exchanges, defying the law’s framers.

Because only 10 states have existing child-care programs, most state legislatures and governors will have to sign off before states implement the BBB’s child-care provisions. In this regard, the prekindergarten proposals look more promising. Forty-five states and the District of Columbia already have state-funded prekindergarten programs, which have been developing since the 1980s. These vary substantially, ranging from truly universal systems in states like Florida and Vermont to limited, means-tested systems in far more states. If the money were right, these preexisting programs might allow states to more easily accept federal assistance. Nevertheless, the Congressional Budget Office projects that 40 percent of children live in states that will not adopt the universal pre-K program funds.

As written, Build Back Better could support — or devastate — child care for disadvantaged working parents

A good program has a fallback option in case states don’t join

Finally, successful programs let the federal government step in if states won’t engage. For example, when states decided not to create health insurance exchanges, the ACA stipulated that the federal government would implement them. While this created a massive and unexpected burden for the federal government, a key ACA provision became reality all across the country.

The BBB’s prekindergarten and child-care programs do not have full fallback provisions. With regards to prekindergarten, if states don’t accept funds, local governments can opt to do so. But there’s no fallback option if states decline the child-care funding. If enacted as is, prekindergarten and child care may happen in some parts of the country and not others, much like what happened with the ACA’s Medicaid expansion, which similarly had no plan B.

The United States often creates hybrid state-federal programs, like those in the Build Back Better legislation. Getting these programs put into practice requires careful policy design. Policy designers may wish to consider the lessons of Obamacare.

Don’t miss any TMC analysis! Sign up for our newsletter.

Philip Rocco (@PhilipRocco) is an associate professor of political science at Marquette University.

Daniel Béland (@DanielBeland) is James McGill Professor in political science at McGill University.

Alex Waddan (@AlexWaddan) is an associate professor in American politics and American foreign policy at the University of Leicester.

Together, they authored “Obamacare Wars: Federalism, State Politics, and the Affordable Care Act” (University Press of Kansas, 2016).