With thousands of child care programs at risk of closing, Democrats press for more money
WASHINGTON (AP) — Democrats in Congress are pushing for a new round of money to keep the nation’s child care industry afloat, saying thousands of programs are at risk of closing when federal pandemic relief runs out this month.
Legislation introduced in both chambers on Wednesday would provide $16 billion a year over the next five years, awarded as grants to help child care programs cover everyday costs. It’s meant to replace $24 billion in relief that was passed in 2021 in the American Rescue Plan and is set to expire Sept. 30.
With no Republican support, the bill faces an uphill battle in Congress.
Without a new lifeline, child care programs serving millions of families could close or increase prices. For many, the federal aid only postponed the financial turmoil that threatened their survival before the pandemic.
“There was a child care crisis even before the pandemic — and failing to extend these critical investments from the American Rescue Plan will push child care even further out of reach for millions of families and jeopardize our strong economic recovery,” said Sen. Patty Murray, D-Wash., a sponsor of the bill.
Other sponsors include Sen. Bernie Sanders of Vermont and Rep. Katherine Clark of Massachusetts.
A June report from The Century Foundation found that without additional money, about 70,000 child care programs would probably have to shut down after this month. That amounts to a third of all programs that received the federal pandemic grants. States distributed the aid in different ways, and many providers already have spent their grants. Either way, the last of it must be spent by Sept. 30.
Arkansas, Montana, Utah, Virginia, West Virginia and Washington, D.C., are at risk of seeing half their licensed programs close, the think tank reported. In total, the programs in jeopardy serve about 3.2 million children.
Hoping to buffer the industry against the upheaval of the pandemic, Congress created a child care stabilization program in 2021. States were given a total of $24 billion to distribute to local programs. It helped more than 220,000 programs, often being used to pay staff or cover rent and utilities, according to the Department of Health and Human Services.
The grants helped Cynthia Davis keep her child care center open through the pandemic, serving eight children at her home in Washington, D.C. When the economy stalled, income stopped coming in. Davis used her personal savings to pay staff and buy safety supplies. She was nearing the end of her savings when she received about $70,000 in federal grants and other relief.
“It really was a breath of fresh air for a lot of us, because those dollars gave me money I could put back into my savings and my retirement,” she said.
Still, inflation and safety costs have taken a toll. Davis had to lay off one worker, leaving her with just one other. Without more relief, she figures her center will close within a year.
“I just don’t know what’s going to happen to a lot of programs,” she said. “We already are stretched to the limit.”
The money was seen as a steadying hand for an industry that badly needed it. In the first two years of the pandemic, about 20,000 programs closed, roughly the equivalent of 10% of pre-pandemic levels, The Century Foundation said.
But even before then, the industry was struggling. The number of providers has been on the decline for years as workers fled the industry and its persistently low pay. Yet demand has remained high, pushing programs to raise prices and, in some places, resulting in child care “deserts” where demand far exceeds available spots.
The average annual price for U.S. child care in 2022 was $10,800 per child, according to Child Care Aware of America, a nonprofit advocacy group.
President Joe Biden has called for expanded child care support, but his biggest proposal stalled amid a polarized Congress and Democratic infighting.
Under Biden’s Build Back Better Act in 2021, parents earning up to 250% of a state’s median income would have paid no more than 7% of their income on child care. But that that bill failed to win support from Democratic holdouts, and the child care plan was later stripped from a slimmer package approved by Congress.
In a statement, Clark said the pandemic relief allowed parents to return to work and paved the way for economic recovery.
“We can’t turn back now,” she said. “Child care is economic infrastructure — it is critical to growing the economy by growing the middle class.”
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The Associated Press receives support from the Overdeck Family Foundation for reporting focused on early learning. The AP is solely responsible for all content.
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Workers are on strike at all 3 Detroit auto makers for the first time in their union’s history
DETROIT (AP) — About 13,000 U.S. auto workers stopped making vehicles and went on strike Friday after their leaders couldn’t bridge a giant gap between union demands in contract talks and what Detroit’s three automakers are willing to pay.
Members of the United Auto Workers union began picketing at a General Motors assembly plant in Wentzville, Missouri; a Ford factory in Wayne, Michigan, near Detroit; and a Stellantis Jeep plant in Toledo, Ohio.
It was the first time in the union’s 88-year history that it walked out on all three companies simultaneously as four-year contracts expired at 11:59 p.m. Thursday.
The strikes will likely chart the future of the union and of America’s homegrown auto industry at a time when U.S. labor is flexing its might and the companies face a historic transition from building internal combustion automobiles to making electric vehicles.
If they last a long time, dealers could run short of vehicles and prices could rise, impacting a U.S. economy already under strain from elevated inflation. The walkout could even be a factor in next year’s presidential election by testing Joe Biden’s proud claim to be the most union-friendly president in American history.
“Workers all over the world are watching this,” said Liz Shuler, president of the AFL-CIO, a federation of 60 unions with 12.5 million members.
The strike is far different from those during previous UAW negotiations. Instead of going after one company, the union, led by its pugnacious new president, Shawn Fain, is striking at all three. But not all of the 146,000 UAW members at company plants are walking picket lines, at least not yet.
Instead, the UAW targeted a handful of factories to prod company negotiators to raise their offers, which were far lower than union demands of 36% wage increases over four years. GM and Ford offered 20% and Stellantis, formerly Fiat Chrysler, offered 17.5%.
Outside the Ford plant in suburban Detroit, Britney Johnson, 35, who has worked for the company about 3 1/2 years and has yet to reach top union wages, said she’d like higher pay, the return of pensions, and cost of living increases. “I like the job. It’s just that we deserve more,” she said.
She joined about 400 workers on the picket line outside the plant.
At the Toledo Jeep plant, assembly line worker Candace Bowles, 52, said it felt “strange” to walk off the job. “I didn’t want to have to do it, but got to do it,” said Bowles.
As the deadline approached, she cleaned up her workstation and walked out when the midnight bell rang. “I’m really happy that everyone stood together,” she said.
The limited strikes will help to preserve the union’s $825 million strike fund, which would run dry in about 11 weeks if all workers walked out. But Fain said more plants could be added if the companies don’t make better offers.
Even Fain has called the union’s demands audacious, but he maintains the automakers are raking in billions and can afford them. He scoffed at company statements that costly settlements would force them to raise vehicle prices, saying labor accounts for only 4% to 5% of vehicle costs.
“They could double our raises and not raise car prices and still make millions of dollars in profits,” Fain said. “We’re not the problem. Corporate greed is the problem.”
The strikes capped a day of both sides griping that the other had not budged enough from their initial positions.
In addition to general wage increases, the union is seeking restoration of cost-of-living pay raises, an end to varying tiers of wages for factory jobs, a 32-hour week with 40 hours of pay, the restoration of traditional defined-benefit pensions for new hires who now receive only 401(k)-style retirement plans, pension increases for retirees and other items.
Starting in 2007, workers gave up cost-of-living raises and defined benefit pensions for new hires. Wage tiers were created as the UAW tried to help the companies avoid financial trouble ahead of and during the Great Recession. Even so, only Ford avoided government-funded bankruptcy protection.
Many say it’s time to get the concessions back because the companies are making huge profits and CEOs are raking in millions. They also want to make sure the union represents workers at joint-venture electric vehicle battery factories that the companies are building so workers have jobs making vehicles of the future.
Top-scale assembly plant workers make about $32 per hour, plus large annual profit-sharing checks. Ford said average annual pay including overtime and bonuses was $78,000 last year.
The Ford plant that’s on strike employs about 3,300 workers, and it makes Bronco SUVs and Ranger midsize pickup trucks. The Toledo Jeep complex has about 5,800 workers and manufactures the Jeep Wrangler SUV and Gladiator pickup. GM’s Wentzville plant has about 3,600 workers and makes the GMC Canyon and Chevrolet Colorado midsize pickups, as well as the GMC Savana and Chevrolet Express full-size vans.
The union didn’t go after the companies’ big cash cows, which are full-size pickup trucks and big SUVs, and went more for plants that make vehicles with lower profit margins, said Marick Masters, a business professor at Wayne State University in Detroit.
“They want to give the companies some space without putting them up against the wall,” Masters said. “They’re not putting them right into the corner. You put an animal in the corner and it’s dangerous.”
Automakers say they’re facing unprecedented demands as they develop and build new electric vehicles while at the same time making gas-powered cars, SUVs and trucks to pay the bills. They’re worried labor costs will rise so much that they’ll have to price their cars above those sold by foreign automakers with U.S. factories.
GM CEO Mary Barra told workers in a letter Thursday that the company is offering historic wage increases and new vehicle commitments at U.S. factories. GM’s offer, she wrote, “addresses what you’ve told us is most important to you, in spite of the heated rhetoric from UAW leadership.”
On CNBC Thursday, Ford CEO Jim Farley said if Ford had agreed to the union’s demands, it would have lost $15 billion during the last decade and gone bankrupt.
Under the UAW strategy, workers who go on strike would live on $500 per week in strike pay from the union, while others would stay on the job at full pay. It’s unlikely the companies would lock the remaining workers out of their factories because they want to keep building vehicles.
It’s tough to say just how long it will take for the strikes to cut inventories at dealers and start hurting the companies’ bottom lines.
Jeff Schuster, head of automotive for the Global Data research firm, said Stellantis has the most inventory and could hold out longer. The company has enough vehicles at or en route to dealers to last for 75 days. Ford has a 62-day supply and GM has 51.
Still, Schuster predicted the strikes could last longer than previous work stoppages such as a 40-day strike against GM in 2019.
“This one feels like there’s a lot more at risk here on both sides,” he said.
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Williams reported from Wayne, Michigan, while Householder reported from Toledo, Ohio.
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Demanding Equity in Higher Education – The American Prospect
Demanding Equity in Higher Education The American Prospect