I have mentioned a number of times the outstanding work done by the Center for the American Experiment on policy issues. I strongly encourage you to check out the Center’s website and follow all this work. A recent post and paper dealt with why child care costs so much here. It is expensive everywhere, but Minnesota is exceptionally expensive, with infant care routinely costing over $20,000 a year. As you might expect, the government is behind this. When people talk about the affordability crisis, there is only one problem–government. The federal and state and local governments have greatly raised taxes and fees of all kinds, at a rate far above general inflation.
But there is another, more pernicious impact of government on affordability–regulations. Housing is an example. Permit fees are very large and add to cost, but the process of having to get permits and various regulations in building codes, density rules, etc. add just as much if not more to housing costs. Electricity is expensive largely because of government taxes and renewable energy mandates. For child care, the cause is in part minimum wage laws, although wages remain relatively low in the industry, which is troubling if you want good staff. More problematic are the extensive rules about how centers must operate. These raise costs to double what family day care charges, but using family day care is risky in terms of quality. Day care is critical to working parents, and the state and local governments are making it hard to operate in both a safe and cost-effective manner. (CAE Post)
