The Wrong Way to Fix the Childcare Crisis

Bad policy dictated by a fake fraud scandal.

One of the defining features of Trump’s policymaking is his habit of building policy on false or distorted premises—often exaggerating a narrow problem into a crisis to justify sweeping, punitive action. These policies are rarely about solving real problems. They are about vengeance, spectacle, and control.

The Childcare Crisis in America

Childcare in America is best understood as a three-part system failure that occurs all at once.

First, prices are high for families:
In 2023, childcare cost an average of $9,200 per child, roughly 10 percent of the median household income for families with young children. For many families, especially single parents, the share of income devoted to childcare is far higher.

Second, pay is low for the childcare workforce:
In 2023, childcare workers earned an average of $14.60 per hour, compared with $23.11 for workers overall. Low pay has made it difficult to recruit and retain workers, fueling chronic shortages and high turnover across the sector.

Third, supply is scarce or badly mismatched:
One national estimate finds roughly 10.8 million licensed childcare slots for 14.8 million children who may need care. Long waitlists, limited hours, and outright closures are now common.

The federal government itself defines childcare as affordable if it costs no more than 7 percent of household income. By that standard, childcare is unaffordable for a large share of American families, and that is before accounting for the higher cost of infant care or households with more than one child in care.

Childcare in the Crosshairs

The administration’s new childcare policy follows a familiar pattern: take a real but narrow problem, strip it of context, inflate it into a generalized crisis, and then use that crisis to justify punitive action.

In this case, the trigger was fraud.

What Feeding Our Future Was—and Wasn’t

Feeding Our Future was a nonprofit sponsor participating in USDA child nutrition programs, including the Summer Food Service Program and the Child and Adult Care Food Program. It did not provide childcare. It handled food reimbursements.

During the pandemic, emergency waivers dramatically expanded eligibility and loosened oversight in federal nutrition programs. Funding to Feeding Our Future grew rapidly. By 2020, Minnesota state regulators raised concerns and began denying new applications. Feeding Our Future sued the state and succeeded in having funding temporarily restored.

By spring 2021, the FBI had opened a criminal investigation. In early 2025, the main trial concluded with the conviction of Feeding Our Future’s founder. Ultimately, 78 people were charged, more than 50 pleaded guilty, and the government estimates total fraud of $300 million or more.

This was a massive fraud case. It was also not a childcare case.

Despite the clear distinction, the case became a catch-all reference point for broader—and unsupported—claims of childcare fraud.

From Food Fraud to a Childcare Crackdown

On December 26, a right-wing YouTuber posted a video claiming to document widespread childcare fraud in Minneapolis. Those claims were later found to be inaccurate. No verified evidence supported them.

That did not slow the response.

Instead, the administration treated the video as confirmation of a broader narrative and moved to “root out waste, fraud, and abuse” in childcare programs—despite the fact that the Feeding Our Future scandal involved USDA food programs, not childcare, and that no large-scale childcare fraud cases had been substantiated.

What followed was not a clarification of facts, but a rapid escalation of federal action.

Federal Action to Restrict Access to Childcare Funds

In January 2026, the Trump Administration issued new guidance tightening oversight of childcare funding. Using guidance, not new regulation, the administration imposed new documentation and reporting requirements on states, slowing payments and increasing administrative burdens.

The Trump Administration has claimed there are allegations of fraud in five states, California, Colorado, Illinois, Minnesota, and New York, but has not released detailed findings or identified specific childcare fraud cases. The federal childcare funds to those states were frozen anyway.

States sued, arguing the administration was effectively changing the rules without following required legal processes. Even as litigation moved forward, the administration launched a formal rulemaking process to codify many of these changes.

Taken together, the timing suggests the administration used guidance to move quickly and forcefully, while turning to formal rulemaking to make those changes durable in the face of legal challenges.

At the same time, Congress moved in the opposite direction, increasing funding for core childcare and early learning programs in the FY2026 appropriations package. Congress is acknowledging the childcare crisis as real and worthy of investment, while the Trump Administration is contributing to it.

A Different Path Is Possible

Some state and local governments are choosing a different path by treating childcare as economic infrastructure and investing accordingly.

New York State and New York City are expanding access through initiatives that build on 3-K and pre-K programs. Other states, such as New Mexico, have moved toward free or near-free childcare by committing stable public funding and prioritizing workforce pay.

Why This Matters

This matters because the childcare crisis places a financial strain on families across the country—and because a strong, affordable childcare system is essential economic infrastructure. When childcare becomes less reliable or more expensive, parents are pushed out of the workforce, providers shut their doors, and costs rise further for the families who remain.

What You Can Do

The Trump Administration is currently accepting public comments on its proposed regulations for the Child Care and Development Fund (CCDF), the primary federal program that helps families afford childcare.

The proposed regulations reduce federal guardrails and shift more decisions to states—allowing states to move away from pre-payments, reimburse providers based on attendance rather than enrollment, and allow families’ cost-sharing above the 7 percent affordability benchmark. These changes would destabilize providers and make childcare less affordable for families.

Public comments are an important part of the rulemaking process. We provided sample comments, but encourage you to personalize your comments.

Here is the link for submitting your comments: https://www.regulations.gov/commenton/HHS_FRDOC_0001-1016

Sample Comment – Parents with Children in Childcare

I am writing to comment on the proposed rule, “Restoring Flexibility in the Child Care and Development Fund (CCDF).”

Allowing states to move away from pre-payments, reimburse providers based on attendance rather than enrollment, and increase family cost-sharing above the 7 percent affordability standard will increase instability in a childcare system that is already under severe strain.

As a parent with children in childcare, these changes are likely to increase costs that my family cannot afford and make it harder to find reliable care.

I urge HHS to retain the protections that exist in the current regulations.

Sample Comment – Childcare Providers

I am writing to comment on the proposed rule, “Restoring Flexibility in the Child Care and Development Fund (CCDF).”

Allowing states to move away from pre-payments and reimburse providers based on attendance rather than enrollment will increase financial instability for childcare providers operating on very thin margins.

As a childcare provider, predictable and timely payments are essential to keeping my center open and serving families in my community. These changes could make my program financially unviable.

I urge HHS to retain the protections that exist in the current regulations.

Sample Comment – Concerned Community Members

I am writing to comment on the proposed rule, “Restoring Flexibility in the Child Care and Development Fund (CCDF).”

Allowing states to increase family cost-sharing above the 7 percent affordability standard and weaken payment stability for providers will undermine access to affordable, high-quality childcare.

As a concerned community member, I believe childcare is essential infrastructure. These proposed changes threaten to make childcare unaffordable for families and unviable for providers in my community.

I urge HHS to retain the protections that exist in the current regulations.

Additional Ways to Engage

In addition to submitting comments, check on your state or city’s commitment to building a strong childcare system. Many of the most meaningful expansions in childcare access are happening at the state and local level.

Child Care Aware of America has information about states’ childcare policies: https://www.childcareaware.org/state-policy-dashboard/

Sources and Further Reading

Childcare costs, workforce pay, and system capacity

• Child Care Aware of America, The U.S. Child Care Landscape
  https://www.childcareaware.org/our-issues/child-care-supply-and-demand/

Federal affordability benchmark (7 percent standard)

• U.S. Department of Health and Human Services (ACF), Child Care and Development Fund (CCDF) https://www.acf.hhs.gov/occ/ccdf

Feeding Our Future fraud case (scope, convictions, and program involved)

• U.S. Department of Justice, Federal jury finds Feeding Our Future mastermind guilty in $250 million pandemic fraud scheme
  https://www.justice.gov/usao-mn/pr/federal-jury-finds-feeding-our-future-mastermind-and-co-defendant-guilty-250-million

Viral YouTuber claims and lack of substantiated childcare fraud

• Minnesota Star Tribune, Viral video prompts new scrutiny of alleged fraud and draws quick reaction from regulators
  https://www.startribune.com/viral-video-prompts-new-scrutiny-of-alleged-fraud-and-draws-quick-reaction-from-mn-regulators/601554058/

Federal guidance restricting access to childcare funds

• U.S. Department of Health and Human Services, HHS freezes child care and family assistance grants in five states for fraud concerns
  https://acf.hhs.gov/media/press/2026/hhs-freezes-child-care-family-assistance-grants-five-states

Proposed childcare regulations (open for public comment)

• Federal Register, Restoring Flexibility in the Child Care and Development Fund (CCDF) (Notice of Proposed Rulemaking)
  https://www.federalregister.gov/documents/2026/01/05/2025-24272/restoring-flexibility-in-the-child-care-and-development-fund-ccdf

Congressional recognition of the childcare crisis

• First Five Years Fund, FY2026 funding bill boosts federal investment in child care and early learning
  https://www.ffyf.org/2026/01/20/statement-fy2026-funding-bill-boosts-federal-investment-in-child-care-and-early-learning/
  (Summarizes congressional action increasing childcare and early learning funding.)

State and local childcare policy activity

• Child Care Aware of America, ECE Policy Across the U.S., 2020–Present
  https://www.childcareaware.org/state-policy-dashboard/