Child care is a part of the welfare system here in the United States. Most of the funds go to low-income working families; however, it is estimated that only one out of seven families who eligible for federally funded child care assistance actually receive it. (Center for Law and Social Policy, June 2002) The programs that do the most as far as making child care affordable for families are TANF, which stands for Temporary Assistance for Needy Families, CCDBG, which is Child Care and Development Block Grant, and Head Start.

TANF’s main job is to provide grants to state-designed programs for families that have c

Agreed to or Passed by Both House and Senate) H.R.3734.

Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (Enrolled as

Department, 2000. http://www.daycarecouncil.org

Because of the lack of affordability of child care, another problem is raised. Parents can’t afford to pay child care, so the state or government pays for it. However, what the state and/or government is paying is low and this causes the child care center to be understaffed or to have unqualified staff, and to have poor or inadequate facilities. This leads to higher turnover rates of employees of child care facilities, and insufficient child care. This effects employers because most families are unable to find affordable childcare that they would be willing to send their children too; therefore, many (especially mothers) are more then twice as likely to quit their jobs (Framing Child Care as Economic Development). Another point is that children who attend day cares and pre-school and receive education could be very beneficial to the government as a whole. A study compiled by Perry called the Perry Pre-school study shows that for every dollar invested in early care and education has a seven dollar return rate for society. Another study completed bye Steven W. Barnett also suggests that at much as $400 billion is wasted when a child does not receive at least two years of early education.

Another factor supporting increased spending for child care is the fact that there are more than just direct effects, which can be defined as the child care industry of child care composed of many small businesses, which employ workers and take in revenues, which contribute to a business, employment, and economic base of any region. There are also indirect effects, which are defined as the first layer of “ripple effects”, or the economic impact of child care spending on local vendors whose sold goods and services to the child care providers increase their revenue enabling them to hire more staff, purchase more goods, and so forth. There is also the induced effect, which is the second layer of the “ripple effect” and is the economic impact of the employees of child care establishments who spend their money on local goods and services in the community. Lastly, there is also the parent impact, which describes the unique economic impact that affordable child care has on the wages of working parents. This factor just measures the amount of economic impact that child care has by enabling parents to be produc

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