There is a sad irony in reading the House’s budget proposal on a week that is nominally national economic development week. Given the proposed sweeping cuts to programs like SNAP, Medicaid, TANF, and others, this budget would cripple families, communities, and the foundational building blocks for a development agenda.
As I’ve been digging into the budget, I’ve been reflecting on the repeated rhetoric of leaders in the administration – most notably Vice President Vance and Elon Musk – to drive a "pro-natalist" movement. Like the push for government efficiency and initiatives such as DOGE, elements of pro-natalism on their face have bipartisan appeal. Healthy birth rates are vital for an innovative, growing, and thriving society, and no one would disagree around a goal of wanting to support healthy families. Yet, much like we've observed with the behavior of DOGE, which has conflated indiscriminate cost cutting with efficiency, the anticipated policy direction in the budget would nominally directly contrast with pro-family goals, undermining the very economic foundations needed for families to flourish.
For many aspiring parents, daunting financial pressures overshadow the dream of starting or growing their family. I’m proud to be a lifelong New Yorker. But here in NYC, a family of four with two children under five would be out of pocket approximately $90k in pre-tax income just to meet the average costs of rent and child care. New York certainly is an extreme, but while the numbers here are cartoonish, the pattern is consistent with a national one: in more than 50% of states, rent and child care costs can be expected to amount to more than 35% of pre-tax income for a family of four. And this is for the median household, not the 50% of our families who are doing worse.
With this in mind, it is hard to reconcile rhetoric with simultaneous proposals to cut the very programs – programs like TANF, various HUD housing assistance programs, SNAP, CHIP and Medicaid – that make family formation possible amid distressed economic conditions.
If we genuinely want an environment where families thrive, we need a policy agenda rooted in robust social investment that creates tangible pathways for families to prosper.
Child Care: An Economic Imperative for Thriving Families
The American child care system is in crisis. Arguably every component of the system, from provider wages to family subsidies to workforce development initiatives, is deeply underfunded. This is true for both licensed providers and family, friend, and neighbor caregivers alike.
At the federal level, HHS has established a directional benchmark that only 7% should be spent on child care; meanwhile, according to Child Care Aware of America’s estimates of child care costs, only two states, South Dakota and Mississippi, provide an average cost of child care that meets this benchmark, and a minority of states are even under the 10% threshold.
It would follow that to incentivize, support, and sustain family creation, investing in affordable, safe, high-quality child care would be a necessary prerequisite. And given the current status quo of distress, the federal budget would warrant increased investment into child care – not to mention the underlying digital infrastructure to ensure that allocated funding flows in timely and effective ways to achieve real outcomes (remember efficiency?). Instead, Congress is weighing a $16.5 billion cut to TANF, a program of which ¾ goes to children and which currently serves as the second largest nationwide funding source for child care.
This is just one of many examples of the failure of the budget to translate rhetoric into sensible policy.
Housing Security: The Bedrock of Family Life
A secure home is the bedrock of family life. Yet, escalating housing costs push this fundamental need out of reach for too many, and conditions are getting worse, not better.
In their status quo, HUD programs are already deeply underfunded. The Section 8 Voucher Program, which is the largest rental assistance tool in the country, is already unable to meet the demand for the voucher – with 75% of eligible individuals and families currently unassisted.
HUD reported last January 2024 that homelessness had increased 18 percent year over year. Moreover, the Center on Budget and Policy Priorities estimated that the House’s proposed budget cuts from earlier in the year would push 248,700 children specifically into homelessness.
It’s hard to encourage more family creation when more families are being thrown into dire economic straits. While the budgetary deliberations this week have focused largely on other programs, the Trump Administration proposed a 40% reduction to HUD programs, and we’ve seen no indication of investment to meaningfully catalyze housing supply or bring down the cost of housing to families.
Economic Empowerment: SNAP, Medicaid, and Programs Stabilizing Families
Beyond child care and housing, broader economic empowerment is key not just to family formation but also ensuring long-term outcomes that contribute to prosperity rather than societal drag. Programs like SNAP, which covers 20% of children, and Medicaid, which covers 42% of children, are proven tools for alleviating poverty and supporting child health and development. Evidence is unequivocal: food assistance, Medicaid and CHIP, and other economic supports directly link to improved child outcomes and a reduced likelihood of families entering the child welfare system.
Some recent discussions have floated ideas like one-time "baby bonuses," and indeed this budget includes a one-time $1,000 stipend to families for children born between 2025 and 2028. While such a proposal might share a similar spirit of supporting families, a one-time payment – though welcome – that amounts to less than 8% of the annual cost of child care falls far short of addressing the substantial, ongoing annual financial burden of raising a healthy and thriving child.
The proposed extension of the Child Tax Credit, which as policy acknowledges this challenge, is good news. However, given the cuts to other fundamental programs attending to the basic needs of families, we could imagine that much of these benefits will go to offsetting other, new costs rather than conferring stability.
Moving Forward: Real Support, Not Just Rhetoric
At Beam, we’re working with some of our most vulnerable families everyday, which includes ensuring access to critical housing and child care supports, food security programs, education and workforce programs, and swift disaster relief. Having catalyzed true economic development agendas in more than 40 states with more than 300 organizations that help our communities grow and stabilize families, we know what works.
A genuine pro-natalist agenda – to mirror the language of the Administration – if indeed a goal, demands tangible, sustained investment in family stability's pillars: affordable child care, accessible housing, and robust economic supports like SNAP, TANF, and Medicaid. The research is clear, and our Beam experience confirms it daily: these investments aren't mere expenses; they are building blocks for a healthier, more prosperous future – and they give opportunities for families to grow and thrive. With clear returns, they are efficient investments.
While the current administration has at times raised topic areas that warrant engagement, from issues like ensuring government can operate more nimbly and efficiently to ensuring our society of the future can thrive, it would be nice if the related policy approaches demonstrated an inkling of intellectual honesty and effectiveness against the problems being raised.
Data Sources:
Median Household Income (2023): U.S. Census Bureau, Income in the United States: 2023 (https://www.census.gov/library/publications/2024/demo/p60-282.html)
Median Rent (2023): U.S. Department of Housing and Urban Development (HUD), American Community Survey (ACS) 1-Year Estimates, Table B25031: Median Gross Rent. Data accessed via the Census Bureau's data tool, data.census.gov.
Median Child Care Cost for Two Children (2023): Child Care Aware of America, Child Care at a Standstill: Price and Landscape Analysis 2023 (https://www.childcareaware.org/thechildcarestandstill/#PriceofCare). I will use the reported state median prices for infant care and preschool care as a proxy for the cost of two children, acknowledging that the actual cost for two children of different ages might vary. For simplicity, I will sum the median infant care cost and the median preschool care cost for each state to represent the approximate cost for two young children.
Chart: Median Household Income, Median Rent, and Estimated Median Child Care Cost for Two Children by State (2023)
