WASHINGTON, Jan 21 (Reuters) - U.S. Treasury Secretary Janet
Yellen on Friday said two years of universal early childhood
education and an expanded income tax credit were critical
components of the $1.7 trillion Build Back Better plan that is
still being negotiated with Congress.
U.S. President Joe Biden this week said he needs to break up
the signature legislation, passing a large chunk now and other
measures later in the year, after running into opposition from
fellow Democrats, Senators Joe Manchin and Kyrsten Sinema.
Biden on Wednesday https://www.reuters.com/world/us/biden-says-he-will-look-pass-build-back-better-elements-piecemeal-2022-01-19
cited strong support for the bill's $555 billion in climate
change spending and noted that Manchin supported early childhood
education, but conceded that plans to fund two years of free
community college and a child tax credit would likely be dropped
to ensure passage.
Yellen said final details were still being worked out with
lawmakers, but singled out as "core" Biden's proposals to
provide two years of universal pre-kindergarten, expand elder
care, cap childcare expenditures for most families at 7% of
their income, and expand the Earned-Income Tax Credit.
Those measures would bolster economic security for
households and boost economic growth, while incentivizing
lower-income workers to seek employment, Yellen told an event
hosted by the World Economic Forum, omitting any mention of the
expanded child tax credit payments favored by progressive and
moderate Democrats, but opposed by Manchin.
The child tax credit is a credit for having dependent
children younger than age 17. The Earned-Income Credit (EIC) is
a credit for certain lower-income taxpayers, with or without
Yellen's remarks at a virtual event hosted by the World
Economic Forum revealed the emerging framework for a
slimmed-down version https://www.reuters.com/world/us/how-white-house-hopes-save-bidens-spending-bill-2022-01-18
of Biden's initial Build Back Better plan.
She said the social spending would help reverse the ongoing
decline in U.S. labor force participation, which has been
dragged lower by early retirements and some younger and
middle-aged workers staying out.
Biden made a big push in December to win passage in Congress
of the spending bill, with higher taxes on big companies and
wealthy Americans slated to cover the cost.
But the bill's progress was stymied when Manchin, a
conservative Democrat from West Virginia, pulled his support in
December after citing concerns about the deficit and inflation.
With all 50 Republicans in the 100-seat Senate opposed to
the spending bill, the White House has to win over Manchin and
any other Democratic holdouts. If it succeeds, Democratic Vice
President Kamala Harris could cast a tie-breaking vote.
Manchin indicated earlier this month that he supported $555
billion in climate spending, including production tax credits
for solar and wind industries, which are seen as vital to ensure
the United States reaches its 2030 emissions reduction goals.
(Reporting by Andrea Shalal and David Lawder; Editing by Andrea