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Don’t Let the CHIPS Fall Where They May

Original illustration by Lucia Li ’24, an Industrial Design major at RISD

A recent move by the Biden administration has merged two seemingly unrelated phenomena: semiconductor chip manufacturing and the provision of affordable child care. The August 2022 CHIPS and Science Act allocates $52.7 billion to domestic chip manufacturing with the goal of reducing American dependence on foreign imports. However, in order to qualify for the funding, manufacturers now must provide affordable, high-quality child care to all of their workers. While noble in its intentions, the administration’s move may not represent a shift toward just family policy: The funding provision is at best a band-aid and, at worst, a dangerous precedent.

President Biden announced the new funding requirement in February. Two years after taking office, he had yet to make good on his campaign promise to provide affordable child care––his initial ambitious proposals, such as universal pre-kindergarten and family leave, were cut from the Inflation Reduction Act which, like the CHIPS bill, passed in the summer. The administration’s decision to announce the new childcare requirement six months after the CHIPS bill passed reveals its willingness to take a page out of the GOP playbook. Republicans often engage in questionable legal tactics––such as using vigilante laws to enforce abortion restrictions in Texas––but the Democratic Party generally adheres closely to political and institutional norms. This makes Biden’s move a relatively unprecedented one. 

Of course, if there is any cause worthy of this kind of cunning political advocacy, it is expanding access to free or affordable child care. The average cost of daycare is a whopping $250 per week, which, for low income families, accounts for up to 12.9 percent of household income. Many families are forced to decide between shouldering these large costs or leaving the workforce to become full-time caregivers. This burden disproportionately falls on women: A 2018 Center for American Progress study found that mothers were “40 percent more likely than fathers to report that they had personally felt the negative impact of child care issues on their careers.” 

Even before the funding requirement, some corporations had introduced incentives to address this crisis out of self-interest. This has been particularly true in the manufacturing sector, which is facing a worker shortage. Because only three in 10 manufacturing employees are women, experts attest that in order to combat a labor shortage and facilitate an increase in chip manufacturing, companies need to reach women who would work if they had ready access to child care. 

But past experience should give us pause before we accept corporate child care as the solution. Some companies, such as Toyota, have been relying on on-site childcare centers for years. Though chip manufacturers have a range of choices available to comply with Biden’s mandate, most are likely to follow Toyota’s lead and create the necessary childcare centers themselves. As they do so, they will need to partner with childcare providers––corporate or community. Annie Dade, a prominent policy analyst, explained in a column that these corporate childcare providers who operate using a  top-down model are in every way “primed to win these contracts.” The recent expansion of the corporate care market has already boosted conglomerates including KinderCare, Goddard, and the Learning Experience. These organizations seek to generate profit; they pocket money at the expense of providing quality care to children. 

Meanwhile, local community-based providers, which already struggle to receive the funds they need, are unlikely to benefit. These establishments, of which 60 percent are minority-owned and 90 percent are women-owned, deserve the government’s support. But without guidelines encouraging chip manufacturers to invest in these providers, manufacturers will turn to the corporate world. This means that Biden’s move, while intended to increase women’s equality, in fact leaves behind the female-dominated workforce that currently comprises the childcare industry. More comprehensive legislation, such as the Child Care for Working Families Act, must be enacted instead to specifically fund and boost existing providers that are currently underpaid. 

Addressing the childcare crisis means reckoning with this systematic undervaluation of childcare workers. After all, it is worth asking why $400 billion in child care was first on the chopping block when Democrats needed to make concessions on the Inflation Reduction Act. The proposed funding was cut to zero in order to get Senator Manchin to vote for the bill. Moreover, the Inflation Reduction Act is not an exception. Childcare provisions were cut from the CARES Family First Act passed during the coronavirus pandemic, the American Families Plan, and Build Back Better. Each one of these bills was framed as a revolutionary, sweeping legislative move. All left child care out. 

While an innovative response to these glaring omissions, Biden’s CHIPS move ultimately risks promoting a culture in which people are reliant on corporations for their paychecks and for their child care. This culture would, in turn, create situations in which people are reluctant to leave harmful work environments out of fear of disrupting their children’s care while also reducing investment in the existing community-based childcare economy and its workers. It is time for the government to take responsibility for providing child care to low-income families instead of trying to offload it onto corporations.