In the News
NYTimes: Crisis Spurs Congress Toward Big Measures to Lift Families From PovertyBy Jim Tankersley and Emily Cochrane
Washington, D.C.,
February 8, 2021
Tags:
Tax Reform
WASHINGTON — The early weeks of the Biden administration have brought a surge of support, in the White House and across party lines in Congress, for what could be the most ambitious effort in a generation to reduce child poverty. The plans vary in duration, design and the amount they would add to the federal debt, but they share a new and central premise in the policy debate over how to help the poor: that sending monthly payments through tax credits to parents, even if they do not earn income from work, is the best way to help feed, clothe and house children from low-income families. One such plan is a cornerstone of the legislative text that House Democrats introduced on Monday as part of what will become a sweeping bill to implement President Biden’s proposed $1.9 trillion economic aid package. That text included a monthly benefit of $300 per child for those age 5 and younger — and $250 per child ages 6 to 17 — as a means of making good on Mr. Biden’s pledge to increase the value of the so-called child tax credit and help more families, even those with little or no income, reap its benefits. While that payout would expire after a year, several Democrats and one influential Republican are pushing to permanently increase child benefits, which researchers say could lift the United States into the ranks of wealthy nations like Canada and the United Kingdom, both of which enjoy significantly lower child poverty rates. The proposal released Monday came at the start of a week of committee hearings that will determine the final details of the Democratic plan to combat the economic and health toll from the coronavirus. The Democrats called for sending $1,400 direct checks to individuals earning up to $75,000 a year and couples earning up to $150,000, the same threshold as previous rounds of payments. The size of the checks would shrink more rapidly for higher earners than in previous rounds, and no household earning more than $200,000 would be eligible for payments of any size. The draft legislation also includes a provision, championed by progressive Democrats, that would increase the federal minimum wage to $15 an hour by 2025. The Congressional Budget Office estimated on Monday that such an increase would cut the poverty rate by nearly 1 percent, but reduce employment by 1.4 million jobs. That potential job loss, which the budget office has previously predicted, was immediately cited by conservatives who oppose the provision.The full draft legislation, which largely mirrors Mr. Biden’s proposals and the president is expected to support, also includes billions of dollars to support schools and colleges, small businesses, and renters and homeowners. It expands benefits for the unemployed, dedicates $25 billion in aid to struggling restaurants and provides a financial rescue for certain private-sector pension plans that cover one million workers and retirees. The congressional Joint Committee on Taxation estimated on Monday that Mr. Biden’s temporary expansion of the child tax credit would cost $110 billion and that the direct payments to individuals would cost $422 billion. The committee has not yet prepared a cost estimate of the full legislative proposal... “We build the architecture for the future,” said Representative Rosa DeLauro of Connecticut, the chairwoman of the House Appropriations Committee, who introduced legislation with Representatives Suzan DelBene of Washington and Ritchie Torres of New York on Monday that would establish a permanent expansion of the child tax credit and make it fully refundable. “That has been underlying so that we’re not just throwing money at a situation, but we are looking at enduring, transformational change.” Click here to read the full article on the NYTimes. |