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Child Care and Welfare Reform
The Federal Role in the '90s and the Next Century

Senator Larry E. Craig
April 2, 1998

Thank you for allowing me to be with you today to talk about what I consider one of the most important challenges facing families today -- access to high quality, affordable child care.

As a parent and a grandparent, I know first hand of the worries, the pressures and the challenges of raising children today. And, as chairman of the Senate’s Republican Policy Committee, I am working to bring senators together to develop new ideas to help give American families the tools they need to raise their children.

Less than a year ago, my daughter Shae and her husband Jeff, presented my wife and me with our first grandchild, a beautiful baby girl named Riley Anne.

Naturally, we have talked a great deal about child care. These are not abstract or hypothetical conversations -- but very real and serious talks that most new parents have when making decisions about child care and about who is caring for that precious little baby every day:

-- Is the home or facility safe and clean?

-- Can they meet the needs of irregular or long work hours?

-- And -- a big question -- is it affordable?

These are not easy questions to answer. And there is no one solution for everyone. There is, however, one goal we all share -- men and women, Republicans and Democrats, government and private sector -- and that is to do what is best for the next generation, our children and grandchildren. We all want them to be loved, cared for, and healthy.

What, then, is the appropriate role for the federal government in promoting that goal?

Over the last several months, as I have worked with various groups here in Washington and traveled my state of Idaho, I have found many people grappling with that question.

Before I talk about where we're going, I think it's helpful to take stock of where we've been.

The first major federal child care program became law in 1990. It's interesting to recall what was in that package:

-- The large majority of assistance was tax relief -- in the form of a larger Earned Income Tax Credit, back when the EITC went only to families with children;

-- The major new program created was a streamlined block grant system -- not multiple mandates or collections of categorical, micromanaged grants;

-- While resources were focused on families of modest incomes, there was NOT discrimination against two-parent families or families with a stay-at-home parent.

In other words, in 1990, a package produced by a Democrat Congress and Republican Administration got the federal role in child care off on the right foot.

It seems to me that a Republican Congress and Democrat Administration should be capable of doing as well again.

And in fact, in 1996, we took the next big step forward in helping Americans care for their children: Welfare reform.

In welfare reform, we provided the states with greater flexibility in developing programs to support the work efforts of low-income parents.

And we recognized the important role that child care plays in helping families support themselves through work, by --

-- combining four programs with different target populations into one Child Care and Development Block Grant, and

-- better integrating child care programs into reformed welfare programs.

For the first time in 60 years, we have begun moving from a fragmented conglomeration toward a seamless system. The new system allows states to use limited federal and state dollars more efficiently AND more effectively.

In short, welfare reform is working. It is our most successful child care program. We won't turn back that clock.

Previously, no single federal program had been more responsible for the dissolution of the American family, and with it the neglect of our children, than "welfare as we knew it."

 Acceptance of life-long dependence on welfare had produced our nation’s greatest source of child neglect: A system in which --

-- "Child care" meant "children caring for children" —- teenage moms (usually without a high school diploma) as heads-of-household in a virtually fatherless environment;

-- Teenage fathers never had to become real fathers -— never had to worry about child support payments or be responsible for supporting a family in any sense of the word.

-- Teenage women were encouraged to leave home and become "parents" without ever receiving the equipment to be good parents -- like a high school diploma, a job skill, basic life and coping skills. They were guaranteed a welfare check and a place to live.

The only real financial penalty was against getting married -— moms who married lost benefits.

No, I'm not saying welfare was ever lucrative -- but it was enough to lure teenage parents out of the family home and into a dependency disguised as independence.

Today, the times they are a-changin'.

From 1994 to October 1997, welfare rolls dropped from 5 million to 3.9 million families --

-- a 22 percent average decline in welfare caseloads nationwide.

Federal resources available to families remaining on welfare have increased dramatically.

* Compared to 1994, states have experienced an average increase of 41 percent per family in the amount of federal resources available to families who are still on welfare.

* Many of our poorest states have witnessed the largest increases in the amount of federal welfare assistance.

This windfall to the states will continue. According to the Urban Institute: 

* State spending on welfare is predicted to continue to decline over the next 5 years.

* If the welfare rolls decline at only half the 1994-1996 rate (i.e., a 13-percent net reduction in caseload by 2002), that will free up 37 percent of the amount being spent by 2002, and still maintain 1996 levels of support.

Just last year, we wrote a third success story: A sweeping revision of the adoption and foster care policy of this country. That effort will benefit hundreds of thousands of children.

As we look to the future, the real question is, Will we learn from the bipartisan successes of the '90s and build upon them? Or drift back into the discredited, bureaucratic, red-tape policies of the past?

Currently there are several bills regarding child care reform in Congress, and there will be more in the coming weeks. The philosophies involved vary sharply.

Sadly, the President's plan ignores our recent successes. It is a pale page from the past. It would:

* Spend $21.7 billion over the next 5 years;

* Create or enlarge federal and state bureaucracies;

* Prefer business and institutional day-care providers, while ignoring the single largest group of providers in this country: At-home parents;

This is not the way to go.

We don't need to proliferate more programs and build more bureaucracy. Even after some consolidation of previous programs in Welfare Reform, the GAO still identified 22 programs with a critical child care component, out of a total of 90 programs with some relation to child care.

As I visit families and listen to parents around Idaho and around America, this is what I hear:

* Parents don’t want the federal government telling them what they need and what’s best for their children.

They know the federal government is a poor nanny and a worse parent.

* Parents want choices. They need more options.

* Families could have more options if the federal government simply took away less of their incomes.

The typical two-earner family now pays 38 percent of its income in taxes at all levels of government.

-- In two-income families, the second earner is NOT working to feed the kids, but to feed the government.

-- In other families, the stay-at home parent really does have to be an expert home economist, to stretch a smaller budget that much farther.

* Parents need more time and more flexibility in balancing the time-demands of job and family.

There is no shortage of ideas among Republicans in Congress on how to help families give their children the care they want. There will be more in the coming weeks and months. Some of those already being discussed include:

• Expanding the child tax credit in last year's Balanced Budget Agreement, especially for very young children.

• Some expansion of the Dependent Care Tax Credit.

• Allowing greater flexibility in, and encouraging more use of, the tax-free Dependent Care Assistance Program already provided by some employers.

• Relief from the tax code's "marriage penalty."

• Sen. John Ashcorft's Family Friendly Workplace Act, which would remove the archaic limitations placed on comp-time and flex-time by the labor laws of the 1930s.

We must remember, every family is unique. Their needs are different from their neighbors next door, or the family next to them.

Likewise, every community is unique. And local communities are better able than distant bureaucracies to understand the needs of, and provide wise and caring support to, their families.

And we must remember that all moms work. Whatever law we enact, we must not discriminate against families where one parent stays at home.

-- Such discrimination hurts the children most of all.

This Congress is committed to helping families care for their children. And we will do that in a way that is non-discriminatory, non-intrusive, fair, broad-based, and uplifting.

And we will work to better support the best social services system and the best anti-poverty program of all: A family with a good job.

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