After hitting record lows in 2019, child poverty in the United States is on the rise. With COVID-19 pushing about 150 million children across the world into poverty, child poverty in America has reached 21 percent. Now, President Biden is proposing an ambitious plan to tackle the growing issue.

By Saurabh Kumar

Like many other socioeconomic crises, child poverty rates in the United States have skyrocketed as a result of the novel coronavirus pandemic. Although according to Pew Research Center, child poverty rates in 2019 had reached record lows, the economic crisis caused by the pandemic has exacerbated inequalities, leading to rapidly increasing child poverty in the United States. 

Child poverty in America is a problem much larger than most people realize. Despite the government spending billions of dollars on anti-poverty programs, the child poverty rate in America is more than twice as high as in many nations including Germany and France and almost three times that of Poland. According to UNICEF, across the globe, children are more likely to live in poverty than adults, and they are also more vulnerable to the effects of adverse living situations. With COVID-19 pushing approximately 150 million more children into poverty worldwide—a 15 percent increase from before the pandemic—the crisis in America where 21 percent of children currently live in poverty is in dire need of addressing.

In addition to the hard-to-swallow reality that over one in five American children living in poverty is grim, it is also unsustainable. Child poverty is an issue with lasting long-term effects. A report published by the American Academy of Pediatrics states that even temporary poverty in childhood can result in adverse health effects that may last into adulthood. It follows that impoverished children experience childhood mortality more than those from higher-income families. Moreover, research from American economist Raj Chetty shows it is almost twice as likely for an individual to advance from an impoverished childhood to an affluent adulthood in Canada than in the United States. 

Poverty is a widespread inequality that impacts many other facets of an individual’s life. According to the United Nations Department of Economic and Social Affairs, those who live in poverty are also at higher risk for inequality in other dimensions of life such as vulnerability to disasters and violence. Unsurprisingly, and similar to many other health, economic, and welfare issues in the United States, minorities—in this case Black and Hispanic children—are overrepresented in the overall population of American children living in poverty. 

This is all to say that child poverty is not something that will go away on its own over time. Despite being on a downward trend for some time, overall poverty rates across the globe are back on the rise and have reached heights in the United States close to the peaks seen in 2012. With only 44 percent of Americans saying economic inequality is a very big issue in the nation (compared to 53 percent for the federal budget deficit), the nation’s policies and attitudes do not reflect the realities of the state of child poverty.

It is a crisis that needs to be actively addressed for the long-term prosperity of the nation at large. The Brookings Institution reports that investing in the nation’s children is a key aspect of ensuring the aging population of the United States does not result in a lack of labor in the near future. Additionally, A Census Bureau report shows how many industries such as manufacturing in particular stand to take large blows as a result of such labor shortages. With nearly a quarter of the manufacturing industry relying on laborers aged 55 or higher, the problem is becoming acute, and attracting quality labor is one of the top concerns for the industry which accounted for almost 12 percent of the overall output of the United States economy in 2019. 

The Economist accurately describes the state of child poverty in the United States as a form of American exceptionalism. Even though, according to Chetty’s research and The Brookings Institution, “The American Dream is in better shape in Canada,” the United States is far behind other nations in implementing appropriate legislation to protect children and the future of the economy. While holding a position in the top three nations with the highest percentage of impoverished children according to the Organisation for Economic Co-operation and Development, only now has the problem come to the forefront of political rhetoric. The reality is, though, that child poverty is not an issue that Americans can pretend is exclusive to third-world countries and television commercials that are too unconscionable to watch. The problem is within America’s own borders. 

After months of debate between two plans to tackle this growing issue—one from President Joe Biden and one from Republican Senator Mitt Romney of Utah—President Biden signed the American Rescue Plan Act of 2021 into effect on March 11. Bipartisan support for pushing legislation that will help reduce child poverty in the United States undoubtedly helped the adoption of a plan, but each proposal had aspects that were not so popular on the other side of the aisle. While Senator Romney’s proposal did not make it to the President’s desk considering Democratic control in Congress, it is important to understand its policy implications. 

By comparing the two proposals to the similar system presently in effect in Canada, it can be hypothesized that Senator Romney’s plan could have expected to reduce the current rate of childhood poverty by a third and President Biden’s plan can expect to cut it in half. While they both utilized monthly payments to impoverished families with children, Senator Romney’s plan had two main components that appealed to conservative members of Congress and the electorate. Firstly, Senator Romney proposed beginning monthly payments before childbirth, appealing to those who are pro-life, and secondly, it was funded by cutting and redirecting money from other government programs’ budgets such as the Child Tax Credit, State and Local Tax Deduction, Temporary Assistance for Needy Families, and Earned Income Tax Credit. Both of these points differ from President Biden’s plan which begins payment when children are born and funds itself with $120 billion in new government spending, a point that is unpopular among fiscal conservatives. 

Under the Democratic plan, eligible families will receive $300 per month for children under six years old and $250 per month for children between the ages of six and seventeen. Though President Biden proposes the payments last for one year only, Congressional Democrats at large want the payments to be permanent considering the new system would amend the already-existing Child Tax Credit. This plan marks the most progressive reform regarding child poverty since the Johnson Administration, and the hope remains that such legislation may sow the seeds of foundational change in the nation. The fact is that children represent the quickly-approaching future of this country, and they have been underinvested in for too long. On the current path, the future for America looks like a population that continues to age rapidly, a shortage of labor, lack of innovation, ever-increasing inequality, and loss of diversity.

“Better late than never” is the motto that could be used to describe the newfound interest in investing in America’s children. Under the Trump Administration, cuts in vital resources such as public education combined with the ongoing suffering in the wake of the pandemic, children found themselves far from Congressional interest, but with the effects becoming more and more apparent, the wellbeing of children can no longer be peripheral. Despite unpopularity among Conservatives and those who feel the word “welfare” is a slur, the Democratic plan is certainly a step in the right direction. The real question is, will it be enough? □

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