Spending on Children Surged During the Pandemic. It Didn’t Last.

Initially, the pandemic left many American parents feeling stuck, cut off from schools and other support systems. But then something important happened. The government has invested billions of dollars in children, including cash payments to families, free school meals and money to childcare centers and public schools.

In 2021, the federal government spent $10,710 per child, through a combination of programs and tax changes, up from $6,810 in 2019, according to the latest installment of Children’s Annual report ‘Shared by Urban Institute’, released Thursday. It amounted to $834 billion, invested in 78 million children.

It doesn’t last. The investments are intended to respond to the emergency, and when it eases and most investments expire, government financial support for families will largely return to pre-pandemic levels by next year. 2024 – and in some categories, will fall from that.

“In my career, I have never seen anything as dramatic as the shift in resources for families with children during a pandemic,” said H. Luke Shaefera professor at the University of Michigan School of Social Work who studies poverty and social welfare.

“We now have more evidence that these types of provisions can actually work, and almost all of them will go away.”

Excluding tax breaks, federal spending is $8,240 per child. By comparison, similar spending for adults 65 and older last year was $35,200 per person. In typical times, for every $1 the federal government spends on children, the federal government spends $6 on adults. This is largely due to medical costs, through Medicare and Medicaid as well as Social Security.

Spending on older adults will increase: One-third of the federal budget now belongs to them, and that share is expected to rise to half in a decade, the Urban Institute said. Children, for comparison, get 9% of the budget now – and this is expected to drop to 6% in a decade.

“The simple story there is that adult benefit spending on Medicare, Medicaid and Social Security is going up, it continues to grow and squeezes everything else out,” said Heather Hahn, co-author of the report. within the budget, including children,” said Heather Hahn, co-author of the report. , who studies child welfare and happiness at the Urban Institute.

As pandemic relief for families with children nears expiration, she said, “all the financial challenges we face are still waiting for us.”

Some researchers say the investments at the time were reasonable, but were too expensive and included too many people to be employed in the long term, as many had no income threshold or job requirements.

“It’s right for these things to expire, because they’re not getting paid and Congress shouldn’t be funding a permanent expansion,” said Angela Rachidi, a senior expert on poverty studies at the American Enterprise Institute. government programs by increasing the federal debt”. “Increasing spending on children may be worthwhile, but only when balanced against the current financial realities of the country.”

The investments come from dozens of programs. The biggest expenditure is child tax creditas direct payment to parents, up to $3,600 per child. Next is Expanding into the healthcare sectorthrough Medicaid and the Children’s Health Insurance Program.

Next Biggest Invest in nutrition – through free school meals and eligibility for food stamps – and welfare programs for needy parents. There is a similarly large investment in child care center and public school.

The government also increased funding for youth job training, housing support and other social services. Of these, spending on children’s health is the largest sector that is expected to continue to grow (due to rising health care costs, not the number of children served).

For every dollar spent by the federal government, state and local governments spend about $2 more, mostly through public schools and health care.

Federal spending on social services has not always made up such a large portion of the budget. In 1960, the government spent 3% of the budget on children and 11% on the elderly, according to the new report. That started to change in the 1960s, with the establishment of programs like Medicaid, Medicare, and Head Start, and the rise of Social Security, food stamps, and housing assistance.

In the late 1980s, the government increased its use of tax breaks and credits as a major source of support for children and low-income people. During the pandemic years, they became the biggest spending category for children.

Before the pandemic, most federal dollars for children went to low-income families. That changed with the pandemic, when more than half of the benefits were universal or close to that, meaning they went to all but the wealthiest families. When those programs expire, the investment will again go to poor families.

When it comes to designing family policies, questions like these – should support be for poor families or for everyone, and should it be provided through cash transfers or goods and services – are issues of much disagreement. But the result is not the same. Clear evidence that government support for families during the pandemic benefits children: In 2021, child poverty rates fell to an all-time low.

Nate G. Hilger, an economist and author of “Mother Trap: How to stop parent overcrowding and fix our inequality crisis. “But it’s always been true, before and after the pandemic.”

Francesca Paris contributed graphics.


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