Urban Wire How Investments in the President’s Proposed Budget Could Lead to More Equitable Outcomes
Victoria Van de Vate
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A woman and child at the kitchen table

With the recent release of the president’s budget for fiscal year 2024 (PDF), the Biden administration outlines its vision for a more equitable nation. A great deal of research has already confirmed that investments in communities of color are critical for mitigating racism and historic disinvestment. Here are five areas of proposed investment that Urban research suggests could reduce racial, ethnic, and gender inequities.

  1. Supporting families
    The president’s budget proposes restoring the expanded child tax credit (CTC) to the levels included in the American Rescue Plan (an extra $1,600 for qualifying children younger than 6 and $3,000 for other qualifying children younger than 18) and creating 12 weeks of paid family leave. In the latest equity scoring paper, Urban researchers found that full expansion of the CTC would help lower poverty rates experienced by families of color and benefit all families receiving the credit regardless of racial and ethnic background. 

    Additionally, analysis from the Tax Policy Center found that families used the expanded CTC to cover routine expenses without reducing their employment. These families also experienced improved nutrition, decreased reliance on credit cards, and long-term education for parents and children. These changes were especially promising for Black, Hispanic, and other families of color. 

    Similarly, expanding paid family leave would increase access to paid family and medical leave for all workers while reducing gaps in access for Latinx and Black workers. The policy would increase the share of workers receiving pay while on leave by 22 percentage points for Black workers and 21 percentage points for Latinx workers. The relatively large increase and clear direction of positive change signal promise for improving equity.

  2. Advancing maternal health 
    The United States continues to face a severe maternal morbidity and mortality crisis, and Black women and other women of color are at particularly high risk. The president’s budget includes $471 million to support implementation of the White House Blueprint for Addressing the Maternal Health Crisis (PDF) to reduce maternal mortality and morbidity rates and address persistent disparities. In addition, the budget requires all states to provide continuous Medicaid coverage for a year postpartum, eliminating gaps in health insurance at a critical time for birthing people. 

    Urban Institute research projects that an additional 123,000 uninsured new mothers would likely be eligible for Medicaid/Children’s Health Insurance Program annually if pregnancy-related coverage were extended for a year postpartum in every state. Although similar shares of Black and white uninsured new mothers would gain eligibility under an extension, Black mothers would disproportionately benefit given their higher levels of postpartum uninsurance.

    The proposed budget also includes an expansion of rural maternal health initiatives, which could improve outcomes for Black women, as Black women in rural areas shoulder a disproportionate share of severe maternal morbidity.

  3. Lowering health care costs
    The budget would make permanent the expanded premium tax credits that the Inflation Reduction Act extended. It also provides Medicaid-like coverage to individuals in states that haven’t adopted Medicaid expansion under the Affordable Care Act, paired with financial incentives to ensure states maintain their existing expansions. Closing the Medicaid coverage gap would result in a 53.7 percent reduction in uninsurance among Black women of reproductive age, the largest decline in uninsurance across all ages and genders.

    Expanding Medicaid coverage could also help alleviate medical debt, which research has shown is held inequitably across communities. Adults in communities of color are more likely to have medical debt in collections reported on their credit reports, with Black adults in particular more likely to have difficulty paying for family medical expenses. These inequities reinforce the racial wealth gap and contribute to disparities in health outcomes. Using the Health Insurance Policy Simulation Model, Urban researchers examined how health reforms might affect household spending and found that filling the Medicaid coverage gap would lead to substantial savings for low-income households in states that haven’t expanded Medicaid.
  4. Increasing affordable housing supply and expanding access to homeownership
    The president’s budget includes $10 billion in mandatory funding to incentivize state, local, and regional jurisdictions to remove barriers to affordable housing developments, such as restrictive zoning. Exclusionary land-use policies can constrain housing production and lead to segregated metropolitan areas, higher housing prices, and fewer options for families with low incomes and people of color. If implemented correctly, incentives for states and localities can promote affordable housing production and encourage movement toward more inclusive metropolitan areas.

    The budget also includes $10 billion in mandatory funding for a new first-generation down payment assistance program to help address racial and ethnic homeownership and wealth gaps. Urban research shows down payment assistance for first-generation buyers could help close the Black-white homeownership gap by helping renters cover the cost of buying a home, a significant challenge for people whose families can’t provide financial support through generational wealth.
  5. Preventing eviction
    Before the COVID-19 pandemic, around 3.6 million evictions were filed annually. Black, Latinx, and women renters were more likely to be evicted, which often led to poor health, financial, and housing outcomes. The budget provides $3 billion in mandatory funding for competitive grants to promote and solidify state and local efforts to reform eviction policies through access to legal counsel, emergency rental assistance, and other forms of rent relief. These funds could help ensure can more low-income households have available financial support and options for recourse to avoid eviction.

Although the president’s budget likely won’t be enacted in its current form, the provisions included provide a strong signal that the administration is prioritizing equity across many policy sectors. Each of these investments and policy changes could have large implications for closing racial and ethnic wealth gaps and improving equity so tracking their passage and implementation offers ample opportunity for continued equity research.

Research Areas Race and equity
Tags Assistance for women and children Children's budget Children's health and development Families with low incomes Federal budget and economy Federal health care reform Federal housing programs and policies Federal tax issues and reform proposals Federal urban policies Health care laws and regulations Health equity Health insurance Homeownership Housing affordability Housing markets Land use and zoning Latinx communities Maternal, child, and reproductive health Medicaid and the Children’s Health Insurance Program  Medicare Paid leave Racial and ethnic disparities Racial barriers to housing Racial homeownership gap Racial inequities in health Rural people and places State and local tax issues Structural racism
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