Child poverty worsens as COVID-era free lunch and child tax credit programs end. : The Indicator from Planet Money School's out, and so are pandemic-era relief measures for families with children. But when universal free lunches and expanded child tax credits roll to a halt, what are the consequences?

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Going backwards on child poverty

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ADRIAN MA, HOST:

Before we get started, a quick ask - NPR is doing its annual survey to better understand how listeners spend time with podcasts. And we want to hear from everybody, but especially new listeners. It is a short, anonymous survey. You can do it at npr.org/podcastsurvey - all one word. Again, that's npr.org/podcastsurvey. Thanks.

SYLVIE DOUGLIS, BYLINE: NPR.

(SOUNDBITE OF DROP ELECTRIC SONG, "WAKING UP TO THE FIRE")

WAILIN WONG, HOST:

This is THE INDICATOR FROM PLANET MONEY. I'm Wailin Wong.

MA: And I'm Adrian Ma. Wailin, do you remember what school lunches were like when you were a kid?

WONG: I remember a lot of mozzarella sticks and also extreme anxiety over trying to get the milk cartons open.

MA: (Laughter) That was all of us, I think. And I remember that and a lot of spongy, trapezoidal pizza, which was delicious. And even though I haven't thought about this in a long time, you know who thinks about school lunch every day? - Larry Wade Sr. That is because Larry is director of school nutrition services for Chesapeake Public Schools in Virginia. It is a huge school district with about 40,000 students. And the menu in Larry's district goes way beyond trapezoidal pizza-flavored sponges.

LARRY WADE: One of my favorites is ciabatta grilled cheese with tomato bisque soup. And it is a big hit.

WONG: That sounds fancy.

WADE: School meals are not what people think they are. We are restaurants.

MA: Restaurants with a particularly precious clientele - right? - with a huge responsibility because their customers are the school kids, you know? And school lunch programs help combat food insecurity in a lot of communities.

WONG: Yeah. And this safety net role increased during the pandemic when the government made it possible for public school districts to provide free meals to all students. In Chesapeake, at one point, Larry's team was distributing seven days' worth of breakfast, lunch, supper and snack to any student who wanted the meals.

WADE: We wanted to feed children. We knew we couldn't do it the way we normally did it. We, overnight, changed almost everything about what we did, why we did it, how we did it.

WONG: The universal free meals was just one of the emergency measures that the government introduced during the pandemic. Another crucial one was the expanded child tax credit, which sent monthly payments to families. But these measures are now gone or going away at the same time that inflation is climbing.

MA: Today on the show, we look at the progress made on fighting child poverty and food insecurity during the pandemic and why advocates are worried about giving back those hard-won economic gains.

(SOUNDBITE OF MUSIC)

WONG: Diane Schanzenbach has a book on her desk. It gets a ton of use. She's actually got two copies of it - one for her home office and one for work.

DIANE SCHANZENBACH: You can see, you know, the spine is broken because I - you know, I use it so much.

WONG: Diane is the director of the Institute for Policy Research at Northwestern University. She studies child poverty. And this well-worn volume is a 2019 report by a group of researchers about how to cut the number of children living in poverty in the U.S. in half over the next decade.

MA: At the time of the report, their estimates showed 13% of children were living in families with annual incomes below the poverty line. And one way to think about that is that for a family of four, that would be an income below $25,000.

WONG: Poverty rates were much higher for Black and Latino children than white children. So the report laid out these policy options for really cutting child poverty.

SCHANZENBACH: For many of us, we were convinced that an important tool in that toolbox would be the refundable monthly child tax credit that would help, you know, make sure that families were able to just bridge their month - you know, not run out of food at the end of the month, be able to pay their rent and pay their utility bills and all of these things that happen on a monthly basis.

MA: So the child tax credit has been around for decades, but as an annual benefit - you know, something that you can only claim once a year around tax time. Diane and her colleagues have been pushing to make this a monthly credit. And finally, in 2021, the government made it a reality. What it did was temporarily increase the size of the credit and then paid out a portion of it in monthly increments. So about 35 million families got monthly payments of 250 or $300 per child.

WONG: The first checks went out in July. Just a month later, according to the Census Bureau, households with children saw their food insufficiency decrease and also their financial hardship decrease. In other words, the money helped families put food on the table and cover their expenses.

SCHANZENBACH: It knocked my socks off to see that sharp decline, and it was what we expected to see, but it was also such a relief to see it that, yes, families are struggling less because of this money that's going out.

WONG: There was some debate among economists about whether the tax credit was creating incentives to not work. But overall, Diane and her colleagues were very encouraged by such clear progress.

MA: And so that's why last September, Diane helped to round up more than 400 economists to sign an open letter to Congress. They were asking for the expanded child tax credit to be made permanent. They argued these monthly payments were already making a huge difference and would also yield long-term benefits.

SCHANZENBACH: It was really exciting to see policy make this positive impact on kids' lives.

WONG: Yeah. And so, I mean, did that give you a lot of hope then when you submitted that letter that you thought you had a lot of momentum behind you to make this case?

SCHANZENBACH: We sure did. That's right.

MA: The very last checks under the expanded credit went out in December, and there was some debate between the White House and Congress about putting this expanded credit into the president's Build Back Better bill. But that bill did not have the support of some key politicians, including Senator Joe Manchin from West Virginia. And that basically doomed the proposal.

WONG: And when the monthly checks stopped, the gains in reducing child poverty were reversed. One measure by Columbia University showed that in just one month, the child poverty rate jumped from around 12% to 17%.

MA: Yeah. That's a huge increase. And I mean, to put it in perspective, that's about 3.7 million more kids living below the poverty line, most of them Black and Latino.

SCHANZENBACH: I feel sad about it because of what I think it means for low-income children and our national investment in them.

WONG: Diane says food insecurity is going back up, too. This is another way to assess how families are doing besides looking at annual income. The Census Bureau captures food insecurity by asking families things like whether they had enough to eat in the last seven days.

SCHANZENBACH: It really is more about the flow of resources. And, you know, we know and we see that, you know, there are many families who live in poverty who don't experience food insecurity, and there are families with incomes above the poverty line who do experience food insecurity.

MA: Which brings us back to school meals. During the pandemic, the government allowed schools to provide free meals to all students - right? - not just the kids who were in families who had incomes that qualified them for free or reduced lunch.

WONG: In Larry Wade's district in Chesapeake, Va., about 40% of students are on free or reduced lunch. But Larry says there are many more families than that who have made use of the free meals during the pandemic. His district is serving over 14,000 breakfasts every day, compared with 8,000 in 2019.

WADE: That benefit was absolutely critical. It was critical then. And in fact, I believe it's still critical. Unfortunately, we're going to have to revert back to what it was prior to COVID.

MA: The government policies that allowed schools to give free meals to all students - they end this month. And that's going to leave a lot of families on their own at a time of high inflation. And Larry knows this. He's also seen the costs in his own cafeteria for things like chicken wings and fruit cocktail cups go up by double digits from just a couple of years ago. So Larry knows how hard it is to afford food these days and how important it is for school meals to help fill that gap.

WADE: We believe the school lunch is the best buy in town, and it has been a major blessing to so many people. And I think that we're going to see some parents who will be deeply disappointed.

WONG: Today is the last day of school in Chesapeake, but Larry doesn't get summers off. He's hard at work on the district's summer meal program, making sure kids get fed even when school's not in session.

MA: And there may still be a shot at reviving a permanent monthly payment for families with kids. On Wednesday, Senator Mitt Romney and a couple of other senators proposed a tax package that would give working families a cash benefit every month.

WONG: This show was produced by Jamila Huxtable with engineering help from Isaac Rodrigues. It was fact-checked by Catherine Yang (ph). Viet Le is our senior producer and edited this episode. Kate Concannon edits the show. And THE INDICATOR is a production of NPR.

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