WASHINGTON, DC—“Clinterngate” came at a very bad time for the White House’s initiative on child care. If one can remember anything pre-Lewinsky, one might recall the photo-op of the First Couple up to their elbows in paste and cardboard paper, unveiling a massive new federal initiative to “improve child care for America’s working families.”

To improve those lives, the President wants to create a maze of new or expanded entitlements with a $21.7 billion price tag. Several different programs make up Clinton’s Child Care Initiative but a look at a few of the key elements will show how the initiative creates a crisis where there may not be one, and ultimately could do more harm than good.

The most expensive component of the Child Care initiative is a $7.5 billion increase in the child care block grants to states. These block grants form the primary subsidy program used to pay for child care for the working poor and those families being weaned off welfare under the new welfare law. But as Darcy Olsen of the Cato Institute reports in her thorough analysis of the President’s plan, that very same welfare law raised the amount of money in block grants available for child care by 70 percent, and many governors reported a surplus. In other words, the existing funds aren’t even being used. Nonetheless, the President’s plan would send this exorbitant bonus into the coffers of state administrators, coffers not even close to empty but apparently never full enough.

A second component of the initiative calls for increasing the child care tax credit for families earning under $60,000—at a total cost of $5.2 billion over the next five years. Aside from further confusing our Byzantine tax code, this expanded Child and Dependent Tax Credit would discriminate against in-home child care since a family with a stay-at-home parent would not be eligible for the credit. As Olsen points out, forty percent of children are still cared for by their mothers at home, and dual-earner couples earn nearly twice the income of a single earner couple. So not only would this credit hurt families with a stay-at-home parent by forcing them to subsidize the $5.2 billion credit—the credit could benefit wealthier, dual-earner families.

Finally, the President justified a major regulatory crackdown on licensing by tapping into the ambivalence, doubt, and guilt associated with leaving one’s child in the care of another. The President’s plan calls for $500 million to create a “Standards Enforcement Fund,” to pay for such things as regulation management, unannounced inspections, and background checks. The President should consult the archives at the Department of Health and Human Services, where a 1980’s study called the National Day Care Home Study found that unregulated care is perfectly capable of creating safe and stimulating environments. In fact, this new fund might more aptly be called the “Day Care Professionals Employment Fund.” By tightening the reigns on eligibility, neighborhood or family networks are excluded from participation in these subsidies and credits, while licensed day-care workers around the country will reap the benefits.

And that’s who really wins in this new initiative—not “America’s working families,” but child-care professionals. With the tax burden at an all-time high, American families would be better served keeping their own money with the freedom to make choices best suited to their own needs. Some parents will work, some won’t; some will enroll in day care and some will enlist grandma. But instead of making that choice for American families, true child-care reform would give the money back to families, freeing them to make their own choices.

—Katherine Post, Director of the Center for Enterprise and Opportunity