Public policy questions are rarely straightforward, which is a big part of the reason people like us and countless other journalists, analysts, researchers, advocates and politicians spend our time debating their granular ins and outs.
Rarest of all are policies that have relatively low complexity, use existing government frameworks, have little observable downside and provide significant return on investment for some of the most vulnerable people, and on that front, the 2021 expanded Child Tax Credit checks all the right boxes. The benefit was individually modest — expanding payments from a cumulative $2,000 to $3,600 annually per child under 6, and $3,000 per child between 6 and 17 — but had enormous impact.
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According to a recent report by Democrats on the bicameral Joint Economic Committee, child poverty nosedived in 2021 to 5.2%, the lowest rate on record. The report estimated that the expansion alone lifted a whopping 2.1 million children out of poverty, and while the program has a high out-of-the-gate price tag, it generated about $1.25 in economic activity for every dollar put in.
Manchin should say yes. (Mariam Zuhaib/AP)
We’re talking past tense because the expansion didn’t survive, and the CTC has reverted to its prior form, unsurprisingly sharply driving child poverty back up. Now, in the lame duck session before the GOP takeover of the House next month, Congress should reinstate the program permanently. Roadblocks include Senate Republicans’ and Democrat Joe Manchin’s objections to the cost and the nixing of the requirement that parents be actively working, yet no one thinks the CTC can supplant a job or discourage work; rather, it is a supplement that lets parents avoid difficult decisions like choosing between school supplies and food, and allows them to better participate in the broader economy.
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Why additionally punish parents who might be between jobs, or more accurately, punish their faultless children? Instead, we should consider this an investment into future generations, with enormous payoff in terms of their continued development. We know it works, now let’s bring it back.
Buffer the children: Congress should reestablish the expanded Child Tax Credit
