Politics

Tweets Perfectly Explain Who Trump's Child Care Policy Ignores

September 14th 2016

With his daughter Ivanka Trump by his side, presidential candidate Donald Trump released a child care plan he says will reduce the financial burdens on America's working families.

The plan would create a new childcare tax deduction for families that make less than $500,000, or less than $250,000 in a single parent home. It also proposes "spending rebates" of $1,200 for low-income families and six weeks of paid maternity leave paid, with the last part being paid for through fixes to supposed unemployment fraud.

However, 10 tweets from August by a Michael Linden, a policy analyst at The Hub Project and former adviser to the U.S. Senate Health Education Labor and Pensions Committee, explain why a child care plan based on tax deductions could fail the people who need help the most: poor people.

Liden's tweets, which were posted in August, don't address Trump's plan specifically, but do outline the limitations of tax deductions in helping low-income families.

Linden tweeted that a system based on tax deductions generally helps wealthier people more than middle class and poor people.

For those who aren't familiar with the complex American tax code, here's how a tax deduction works. Let's say you make $70,000 a year, and you get a $7,000 tax deduction. As a result of the deduction, you're taxable income would decrease to $63,000 per year. If you're taxed at 12-percent, you'd end up saving about $840 on your tax bill. A Trump fact sheet lays out this very scenario, stating "for a family earning $70,000 per year in the 12 percent tax bracket with $7,000 in child care expenses, the deduction would reduce taxes by $840 per year."

Linden's basic argument is that low middle and lower income people are spending a higher share of their income on child care and the cost has a more significant impact on their financial lives, according to Linden. The average cost of child care in some states is $10,000 to $20,000 a year, according to The New York Times. So, reducing their annual tax burden won't remotely address this structural problem.

Trump is also offering $1,200 "spending rebate" for low-income families Unlike a tax deduction, which allows tax payers to deduct an expense from the amount of taxable income they declare, a "spending rebate" directly takes an amount off of a tax bill.

But, for poorer families struggling to pay for child care each week, and waiting to get a tax refund once a year is impractical, according to Linden.

And yet, the idea that poorer families would be able to save their tax refund each year to make weekly or monthly payments on child care seems unlikely. Roughly half of Americans save 5 percent or less of their income, according to CNN Money. An analysis of Bureau of Labor statistics from NPR found that low-income Americans disproportionately spend more money on transportation, utilities, and groceries and much less on savings than middle and higher income Americans, which makes saving less feasible.

RELATED: 3 Ways that the U.S. is Failing Mothers

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