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Editorial: Child care proposal gets most from limited state funding

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Posted on January 21, 2013 |
By Angelo Lynn



One of Gov. Shumlin’s most far-reaching, and controversial, proposals in his State-of-the-State Address was suggesting the state divert $16.7 million from a tax credit for low-income Vermonters to fund a doubling of child care subsidies for low-income residents.

Critics of the proposal have fallen back on an old refrain: that it doesn’t make sense to rob Peter to pay Paul. Why reduce one subsidy that helps Vermont’s poor, and allocate those same funds into another program?

Department of Children and Families Commissioner David Yacovone has a clear response: It’s a bold and strategic move, he has said, that was a long overdue change in policy that “prioritizes our resources.”

Obviously, if government had all the money it needed, the preferred course of action would be to fund both programs. But, as the Secretary of the Agency of Human Resources Doug Racine said in a story last week in VTDigger, the state doesn’t have an infinite amount of money to work with and has to constantly reallocate tax resources in the most effective way.

“We’re talking about a finite amount of money available to help,” Racine told VTDigger. “With more money, we could obviously do more, but with a finite amount of money, our job is to get the maximum value out of the dollars we have. … I know we’ll get more value out of the dollars spent on children, than we will with how the dollars are spent now,” said Racine.

“I don’t think it’s really a question of fairness,” he added. “It’s a question of priorities.”

Liberals and progressives should note the distinction.

This is not a question of philosophical ideology; of favoring the wealthy few over the poor. Of all the people in Vermont politics who have advocated for the poor, Doug Racine and Peter Shumlin have long been among the most ardent supporters. Why would they make such a recommendation? Because with the limited amount of money the state has to help low-income Vermonters, they think that doubling the child care subsidies will do more long-term good than doling out money to folks who need state assistance to pay their bills. Why don’t they advocate for raising taxes on the rich to pay for yet another program for the lower-income, because they understand there is a limit to taxation beyond which it becomes detrimental.

Progressives may want to argue where that limit is, but to simply argue that more money should be given to the poor (by raising taxes on others) misses the crux of the debate, which is and always has been: With limited funds, where should we spend state resources and how do we get the most return from taxpayer dollars?

Vermonters should note that Shumlin’s budget proposals are taking on a lot of new territory. While his administration launched health care reform in the first biennium with the goal of a single-payer health care model, in this second biennium he has launched initiatives to significantly boost the state’s educational system, make it a K-16 model, and improve performance outcomes. He thinks that by shifting the state’s resources from a handout that helps keep Vermont families from falling below the poverty line ($23,000 for a family of four, and $19,000 for a family of three), to helping 900 more families put their children into subsidized childcare that the long-term outcome will be superior.

His thinking is clear: By investing significantly in early childhood education, the state is spending resources when educators know the pay-off is the greatest — in those early years when minds are like a sponge and quality child care pays huge dividends in a child’s ability to learn throughout his or her life.

The option is to keep the status quo, and dole out money to those falling under the poverty line to help them pay today’s bills. The latter is a policy that helps those in trouble now, but it is hand-to-mouth. Nothing within that policy helps better educate the family or offer a long-term solution to their problem. Putting more money into education and child care subsidies does improve the long-term prospects of the beneficiaries and helps break that cycle of poverty.

In this case, shifting the funding from one program to another makes perfect sense when you’re dealing with in the realities of budget limitations. Shumlin, Racine and Yacovone were bold enough to make the suggestion and push for real change. We’ll now see if the Progressives and liberals who have been quick to criticize the proposal can come up with counter proposals to accomplish as much while not raising more taxes.

— Angelo S. Lynn

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