Home | Opinion | Opinion: Compared with Trump’s childcare policies, ours seem socialist
Photo: Gage Skidmore

Opinion: Compared with Trump’s childcare policies, ours seem socialist

The US election is (finally) over. The cult of personality won over cool-headed rationality, and the fallout of this is looking bad for the climate, free-trade and illegal immigration, amongst other matters.

But what about the kids?

Upon Donald Trump clinching victory, his plan for his First 100 Days as president has been brought into sharp relief.

A point on his brief agenda covers childcare, and reads as follows:

“Affordable Childcare and Eldercare Act. Allows Americans to deduct childcare and elder care from their taxes, incentivizes employers to provide on-side childcare services, and creates tax-free Dependent Care Savings Accounts for both young and elderly dependents, with matching contributions for low-income families.”

Translated, this means:

  • Childcare is completely tax-deductible, but this won’t help up to 45 per cent of Americans, as they earn below the federal tax threshold. It also won’t help the richest: individuals earning over $250,000 won’t be eligible to receive the deduction
  • Those below the tax threshold are eligible for a small rebate, but this is paltry compared with a full tax deduction (for example, those earning $31,200 a year will receive the maximum amount of $1200)
  • The Dependent Care Savings Accounts will make a real, monetary difference. They allow people to set aside $2000 for dependants’ expenses, tax-free. Low income families will receive a $500 bonus payment
  • How the Trump administration will finance all of this is anyone’s guess.

Trump’s decisions might have worldwide reverberations, so, for early learning, let’s dissect how they compare with ours down under:

  • The government’s proposed Jobs for Families childcare package isn’t as generous as Trump’s complete tax-deduction scheme. But, in an opposite fashion to America, there’s a larger safety net for low-income earners: the less people earn, the greater the subsidy they can receive
  • Low-income families can be further assisted by a ‘top-up’ payment, in addition to the regular subsidy. It is unclear how this measures up to Trump’s Dependent Care Savings Accounts
  • The government has indicated it will finance these changes with cuts to family tax benefits

So, in sum, Trumps’ proposed changes seem to favour the moderately wealthy, and ours the relatively poor. Yet, we share at least one childcare commonality with our trans-Pacific ally: likely blockages by obstructionist parliaments.

In the US, especially when it comes to paid parental leave, Trump’s suggested six weeks’ worth has invoked the ire of several prominent Republicans: Texas senator Ted Cruz and Speaker of the House Paul Ryan, for instance.

Here in Australia, Labor and the Greens are staunchly blocking the government’s proposed new childcare policy funding method.

For both countries, legislative gridlock will mean that, along with the Spice Girls and the Clinton era, childcare policies are condemned to be stuck in 1990s.

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