Federal spending on children falls to lowest level in a decade

Budgets are in some ways "how we, as a society, define our priorities. It’s clear that kids are not our priority in the budget," says one of the report's authors.
Back view of elementary students raising their arms on a class.
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By Carmen Sesin

Federal spending on children in the United States fell to the lowest level in a decade in 2018, negatively impacting working families with children, according to a report released Tuesday by the Urban Institute.

Spending fell to about $6,200 per child younger than 19. The decline was driven by a reduction in federal spending on education and nutrition programs and a temporary reduction in child-related tax credits.

The decline in spending will affect working families that have children, particularly minorities including Latinos and blacks. Currently, Latino children make up about a quarter of all public school students.

The decline in funds is most reflective in the soaring student debts and the debate over who should incur student debt and who shouldn’t.

“It’s part of a very broad trend that’s going on in our society,” said Eugene Steuerle, Institute Fellow and chair at the Urban Institute, who is one of the authors of the report. “In some ways it’s beneath the radar, unfortunately.”

“What’s getting squeezed is investment in our children,” Steuerle said.

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The Urban Institute’s Kids’ Share report tracks public spending on children younger than 19 from 1960 to 2018 and makes projections for the future based on current law.

Steuerle said the problem with the decrease in spending is part of an ongoing battle between Republicans, who continue cutting taxes and Democrats who neglect the exorbitant growth that has taken place in programs like health and retirement.

The largest source of federal support for children comes from Medicaid followed by the earned income tax credit. Although there is a projected increase of $1.5 trillion in federal spending over the next decade the report finds that children’s programs will only receive 3 cents of each dollar.

As spending increases to pay for Social Security, Medicare, Medicaid and interest payments on the debt, children’s share of the budget will continue to drop.

The report indicated that the share for children is expected to decrease from 9.2 percent to 7.5 percent over the next 10 years if no changes are made to the current law.

In fact, by 2020 the government will be spending more on interest payments on the debt than on kids. So even if there is growth and money to allocate, much of it has already been pre-committed.

Steuerle also indicated the U.S. has largely neglected kids who don’t graduate from college by not supplying schools with resources necessary to adequately prepare them for society.

“We’re not investing in our future,” said Steuerle. “We’re not investing in our children which is everything from education to support for working families who have children.”

Steuerle also noted that demographics of the future generations that will be incurring the costs of transfers being made to the current generations. “Future generations are going to be minority majority. The children will be increasingly Hispanic, Black, and Asian.”

He said some say budgets are “in some ways how we, as a society, define our priorities. It’s clear that kids are not our priority in the budget.”

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