The Nursery Compact

The problem

Child care in the United States is priced like a luxury and needed like a utility. Child Care Aware's 2025 survey put the national average price at $13,184 a year, and found that a year of infant care in a centre costs more than a year of in-state tuition at a public university in 38 states. In every region of the country, centre care for two children costs more than housing. A parent earning the median wage who pays for two children in care is working, after tax, for something close to nothing; a great many do the arithmetic and stop working, and the ones who stop are overwhelmingly mothers.

The consequence runs through the whole economy. Women's labour force participation in the United States, which led the rich world in 1990, has fallen behind Canada, Germany, Japan and most of Europe, and the studies that ask why keep arriving at the same answer. Where care is affordable, mothers work; where it is not, they do not, and the country loses their output, their taxes and their pensions, and the children lose the early education that the same studies find matters most for the poorest of them.

Quebec ran the experiment. In 1997 the province began offering child care at a flat daily fee, now about $9.65 a day, through a network of nonprofit centres and regulated home providers, at a public cost of about $2.7 billion a year. Mothers' employment in Quebec rose from the lowest among Canada's large provinces to the highest, and economists who have tracked the programme find that the additional income tax paid by the mothers who went to work recovers most of the programme's cost. Canada extended the model nationally in 2021, with a target of $10 a day in every province. The early Quebec results on child development were mixed and in some studies negative, which this proposal takes seriously below; the later results, after the province raised standards, are better.

№ 008 gave every citizen child a stake at birth and № 088 gave the parents a year. This proposal covers the four years between the end of the year and the start of school, which is where the bill arrives.

The proposal

The Nursery Compact: a place in licensed care for every citizen child from age one to school entry, at a parent fee of $10 a day, falling to zero below the median income. Delivered through existing centres and licensed home providers, paid a public per-child rate that funds a quality floor: staff ratios, training and a wage floor for the people who do the work. A parent who cares for a child at home instead receives half the per-child rate as a home-care payment. Funded federally, administered by the states.

How it would work

1. A place, not a programme. The Compact does not build a federal nursery system. It pays the providers that exist, centres and licensed family homes, a public rate per child that covers the cost of care at the quality floor, and lets the parent choose among them. New providers may enter on the same terms. A community with no provider receives the rate as an offer to whoever will open one.

1. Ten dollars a day. The parent fee is $10 a day, about $2,500 a year, for families above the median income, and falls on a sliding scale to zero below it. The fee exists because a free service is an unpriced one and Quebec found a nominal fee keeps places from being held and not used.

1. The quality floor. The public rate is paid only to providers that meet a floor: staff-to-child ratios at the level of the better American states, a training requirement, and a wage floor for staff at or above the local median wage for the work. The early Quebec findings on child outcomes were worst in the for-profit centres that expanded fastest at the lowest standards; the floor is the lesson.

1. The parent's choice. A parent who keeps a child under five at home rather than in care receives half the public per-child rate, about $7,000 a year, as a home-care payment, on the Finnish model. The Compact is not a decision that every child should be in a centre. It is a decision that the family that stays home and the family that does not should both be supported, and that the one that does not should not be bankrupted.

1. Citizen children. The place and the payment are for citizen children, on the registry of № 001. A guest family under № 003 buys care at the public rate, which is far below today's price, through the same providers; the subsidy follows the line the catalog draws everywhere money moves.

1. The states administer. Licensing, inspection and payment run through the state agencies that already license child care, under the federal floor. A state that wants a higher standard may set one and pay the difference.

The numbers

The children. About 15 million under five; roughly 12 million citizen children between one and school entry. At a take-up of 60 percent, about 7 million in care.

The cost. A public rate of about $15,000 a child, near the current average price plus the quality floor, is about $105 billion for 7 million children, less parent fees of about $15 billion, or $90 billion; the home-care payment for perhaps 3 million children at $7,000 is about $20 billion; total about $110 billion. Existing federal spending on child care and early education, the block grant, Head Start and the tax credit, is about $25 billion and folds in. Existing state spending adds some. The new money is on the order of $70 billion a year, and it is written here so it is not discovered later.

The return. Quebec's economists estimate that the income and payroll taxes paid by mothers who entered work recovered about 90 percent of the programme's cost at the provincial and federal level combined. The United States is not Quebec, and this proposal does not assume the same; it assumes that a substantial share of the cost returns, and that the rest is the price of a place for every child.

The workers. The wage floor is the largest single item and the one the current market cannot supply: child care workers earn about $15 an hour, below parking attendants, and turnover is above 30 percent a year. A floor at the local median roughly doubles that pay in most places, and it is the reason the public rate is $15,000 rather than $13,000.

The honest objections

"Seventy billion dollars a year, on top of the Parent's Year, on top of the Education Jubilee." Yes. This catalog has said each number out loud and it says this one: the Covenant is expensive, and its cost is the price of a country in which a child's care does not cost more than a university and a mother's job does not cost her the family's income. The reader who thinks the price is too high should say which child does not get the place.

"Quebec's own studies found worse behaviour and health in the children who went through the programme." The Baker, Gruber and Milligan findings are real and the proposal does not dismiss them. They found negative effects concentrated in the programme's first decade, when for-profit centres expanded fast at low standards, and later research found the nonprofit centres at higher standards produced neutral or positive results. The quality floor in item 3 is the design response, and the honest concession is that a floor costs money, which is why the rate is set where it is.

"This crowds out the parent who stays home and the grandmother who helps." Item 4 pays the parent who stays home half the rate, which is more than any current programme pays them, which is nothing. The grandmother may register as a licensed home provider and be paid the rate, as Quebec's home providers are.

"There are not enough child care workers to staff it." There are not, at $15 an hour. The wage floor is what changes that, and the phase-in over five years is what lets the workforce grow into it. A sector that pays the median wage recruits like any other sector that pays the median wage.

"Universal care is a subsidy to the rich, who can afford $13,000." The rich pay the $10-a-day fee and receive a place their money could have bought anyway; the subsidy to them is real and small. The alternative, a means-tested programme, is the one the country has now, and it reaches about one eligible child in six because the application is the barrier. Universality is what makes the place exist for the child whose parent would never have filed the form.

Sources

• Child Care Aware of America, Child Care in America: 2025 Price & Supply (May 2026), national average price and state comparisons with public college tuition
• Economic Policy Institute, Child care costs in the United States, state-by-state estimates
• Gouvernement du Québec, Ministère de la Famille, programme cost and daily fee; Pierre Fortin, Luc Godbout and Suzie St-Cerny, "Impact of Quebec's Universal Low-Fee Childcare Program on Female Labour Force Participation, Domestic Income, and Government Budgets" (2012)
• Baker, Gruber and Milligan, "Universal Child Care, Maternal Labor Supply, and Family Well-Being," Journal of Political Economy (2008), and "The Long-Run Impacts of a Universal Child Care Program," American Economic Journal: Economic Policy (2019); Haeck, Lefebvre and Merrigan on later cohorts
• Employment and Social Development Canada, Toward $10-a-day: Early Learning and Child Care
• Bureau of Labor Statistics, Occupational Employment and Wages, child care workers
• Proposals № 001 (The American Dividend); № 003 (The Open Door Compact); № 008 (Baby Shares); № 021 (The Caregiver's Wage); № 088 (The Parent's Year)