Executive Summary

Federal policymakers on both sides of the aisle are considering a greater federal role in early childhood policy as an expanding body of brain science underscores the importance of children’s earliest years. Prompted by this growing interest, the Build Back Better Act of 2021 (BBB) included two large early care and education programs, together described by the Biden administration as “the most transformative investment in children and caregiving in generations.” 

Build Back Better was passed by the House in November 2021, but later blocked in the Senate. While much of the bill was included in revised legislation, renamed the Inflation Reduction Act and passed into law in August 2022, BBB’s early care and education provisions did not make the cut. Yet those provisions remain relevant, providing a detailed legislative blueprint of a growing vision for America’s young children still vigorously promoted by many as the best approach to federal early childhood policy. The original BBB legislation clearly lays out this increasingly influential vision, often summarized by its supporters as “education starting at birth”: a centrally controlled “early learning system” comprised of federally-funded preschool programs for all children from birth onwards, closely regulated — and often operated — by federal and state government, and more closely aligned with K–12 schooling. 

Advocates have widely characterized BBB’s early care and education legislation as building on the core strengths of the existing federal childcare program, the Child Care and Development Block Grant (CCDBG), established in 1990. The legislation continued CCDBG’s commitment to state flexibility, they maintained, while further bolstering its support for parental choice. Yet far from expanding and improving on CCDBG, BBB actually mapped out a striking departure from it. 

BBB would have greatly increased government regulation of early care and education, amplifying the federal role while substantially reducing state flexibility and parental choice. The legislation would ultimately have reduced provider quality, transferred wealth from lower- to higher-income populations, and institutionalized a strong, new incentive for putting young children in childcare, as follows:

Amplified federal role

BBB aimed to centralize control over much of the nation’s early care and education in a single federal agency, diminishing state and local leadership and flexibility. BBB’s multiple provisions for an amplified federal role would have empowered the U.S. Department of Health and Human Services (HHS) to define, monitor, and enforce key aspects of early care and education in BBB-funded states, including minimum staff qualifications and pay, local provider prices, a range of “quality” standards, and compliance with a slew of complex HHS regulations.

Substantial expansion of state government infrastructure

BBB would have mandated and funded a large scale-up of state regulatory and administrative activity for early childhood programs. States would have had to monitor providers’ compliance with a range of state and federal mandates; carry out ongoing “quality” ratings of every provider; conduct ongoing “continuous quality improvement” activities; help childcare and pre-K staff obtain additional credentials and degrees; license providers that were previously exempt from licensing requirements; develop new licensing standards; relicense previously-licensed providers under these new standards; and administer pre-K across the state, all overseen by HHS.

Counterproductive quality-improvement mandates

The legislation would have institutionalized a federally-defined concept of “quality” that has no demonstrated relationship to child development outcomes and is inconsistent with how parents — much less children — define it. Under BBB a provider would have been defined as “high quality” based on three criteria: 1) Rating highly on the state quality rating system, designed according to federal requirements; 2) Employing staff with federally mandated degrees and credentials; and 3) Paying those staff at a rate equivalent to the state’s public elementary school teachers.

Indeed, BBB’s definition of “quality” largely excluded what families care about most: their children’s day-to-day experiences and developmental outcomes. At the same time, the unintended consequences of BBB’s mandated quality improvement and control activities would likely have negatively affected provider quality overall: causing the net quality of the early care and education workforce to decline and increasing the number of children cared for by each staff member.

Diminished parental choice

Overall, BBB aimed to shift the federal role from funding parents to funding highly regulated government programs instead, while simultaneously moving early care and education closer to integration with K–12 public schooling. The bill prescribed a substantial transfer of power from families to federal and state government agencies, promoting providers’ compliance with a range of federal and state laws and regulations over parental choice.

Wealth transfer from lower- to higher-income populations

BBB would have redistributed resources from nonparticipating to participating states, giving large new benefits to relatively high-income families, and providing larger benefits to families in wealthier states. While BBB was widely characterized as providing help for all struggling families and their young children, it disproportionately benefitted more affluent families. At the same time, the White House fully anticipated that multiple states would decline to participate in the program, officially projecting that BBB would do nothing for more than two out of five potentially eligible children across the country. 

Financial incentive for placing children in childcare beginning in infancy

Under BBB, the families who would gain the most financially were those who put the most children in childcare, for the greatest number of hours per day, starting when their children were the youngest. The legislation thus established a strong, new incentive for putting children in nonparental care — reinforcing a growing cultural bias towards group, institutional care,  increasingly promoted as the best means to advance the healthy development of young children.

A Better Path Forward

Improving the environments where children spend their earliest years while helping parents balance work with raising children are crucial policy goals. Many continue to promote Build Back Better’s early care and education legislation as the best way to achieve those goals. But close analysis shows that BBB prescribes the wrong approach to this important issue.

What lower-income families need are adequate funds to access good care and education, not a huge, federally controlled program providing nonparental group care and education for all children under age five. And federal policy must bolster, not diminish, parents’ crucial role in their children’s well-being and development. Policy should therefore aim to improve early care and education environments for lower-income children by maximizing parents’ agency in determining where and by whom their young children are cared for. 

Three principles should guide federal policymaking towards this end:

  • Direct resources to the children and families for whom most is at stake. Federal funds should be targeted to parents who must work, yet do not have access to high-quality providers for their young children — helping families who cannot pay, rather than those who would prefer not to.
  • Expand and strengthen informed family choice. The solution is not to replace the early care and education market with a huge federal program, but rather to make it work for the lower-income families who need high-quality early care and education the most. 
  • Design programs that all states are willing to participate in. Federal programs to improve child well-being must reach children in all 50 states. When the design of a federal early childhood program neglects to address a state’s needs and concerns, the program simply fails children in that state. Indeed, programs that are not intentionally designed for maximum state participation essentially prioritize the well-being of young children in some states over others.  

The Child Care and Development Block Grant (CCDBG) — the existing federal childcare program — is a strong vehicle for accomplishing these aims. The program’s 2014 reauthorization included particular emphasis on supporting healthy child development. Core to CCDBG is the importance of respecting and supporting parents’ decisions regarding the care and education of their children. And the program is explicitly designed to maximize state engagement. Federal early care and education policy should therefore build on CCDBG’s strengths by making the program work better for the families it aims to serve. Through CCDBG, the federal government can help empower and support the lower-income working parents who truly need assistance, giving their young children a better chance to flourish.