Feeding kids shouldn’t be partisan

And neither should supporting new parents.

Having a baby is expensive. The medical costs for pregnancy, childbirth, and post-partum care amount to $20,416, including $2,743 in out-of-pocket costs for women on employer plans. Hospital expenses could be even greater if the child requires admission to NICU. Factor in a crib, a stroller, a car seat, and other basic equipment, and parents are looking at thousands of dollars in one-time costs due before or at the moment of birth.

A new bipartisan bill would help address this problem head on. The Supporting Newborn Parents Act — sponsored by Representatives Valadao (CA-22), Suozzi (NY-3), Dingell (MI-6), and Moore (UT-1) — is legislation that would create a new $2,000 tax credit per newborn child, providing immediate relief during one of the most financially demanding periods of a family’s life.

The baby bonus

This newborn credit would complement the existing Child Tax Credit (CTC) while giving new parents additional flexibility. Families would accrue value from the newborn credit for every dollar earned above $0. The credit phases in at a 20% rate, where every additional dollar earned adds twenty cents to the credit amount received. Families would receive the full $2,000 credit if they’ve earned $10,000 or more, with the overall credit amount indexed for inflation in future years. Like the CTC, the newborn credit begins to phase out at a 5% rate beginning at $200,000 for single filers and at $400,000 for joint filers.

Parents could receive their tax credit when they file their taxes, or they could decide to receive it right after birth. At the hospital, parents could fill out a form to receive advance payment of the credit along with the standard Social Security Administration application at birth. This streamlined process ensures families don’t have to wait months to cover the immediate costs of a new child. In order to avoid improper payments when immediately claiming the credit, new parents can apply using their income level from the current or previous year.

Make the most of the opportunity

In a political landscape set to be defined by, at best, a divided government over the next few years, liberals should view a newborn credit with a phase-in as a worthwhile legislative endeavor. A significantly larger and fully refundable Child Tax Credit delivered through monthly payments modeled on the 2021 American Rescue Plan is highly improbable this Congress or next. By accepting and supporting a phased-in credit focused on tackling one of the most challenging economic moments for parents, liberals can work to secure a tangible policy win now and avoid the “all-or-nothing” trap that arguably derailed previous legislative efforts.

Critically, this legislation can serve as the first step to securing a truly universal newborn credit. There will not only be a single bite at the apple. Passing the Supporting Newborn Parents Act this Congress will deliver cash assistance to millions of middle and working class parents over a short period of time — without breaking the bank — and make it fiscally easier for a future Congress to make the newborn credit fully refundable or embed it within a reformed Child Tax Credit than if lawmakers need to start from scratch. A $2,000 “baby bonus” with an earnings requirement would likely cost in the ballpark of $70 billion over ten years — shifting from that sort of phased-in version to a universal version would require a more modest increase in cost per year.

This is Searchlight’s rationale for endorsing the bill: a fully refundable credit is unlikely to pass in the near future, and parents of newborns would benefit from real progress this Congress or next. By delivering a robust newborn credit now, we can support American families in a meaningful way, build a growing constituency for this program, and then work to further expand the benefits in the future.

By championing the Supporting Newborn Parents Act, lawmakers have a rare opportunity to move past the gridlock and deliver meaningful relief to American families. Securing this ‘baby bonus’ today is a win for new parents and helps to build a more robust support system for the next generation. Liberals should feel proud to back this bill, knowing that millions of new parents and their babies would quickly benefit if passed.