Shortly after taking office, President Biden got to work selling Congress and the country a massive coronavirus relief program. The Child Tax Credit (CTC), which was supposed to be worth $ 1.9 trillion, has been reduced from $ 2,000 to $ 3,000 per child (or $ 3,600 for children under 6) and made refundable.
For parents earning $ 400,000 or less, the program offers direct payments in the range of $ 250 to $ 300 per month for those who file jointly ($ 200,000 on a single tax return).
Speaking of the CLC, the President made some bold statements that seemed a bit far-fetched at the moment. “If we do that, it will cut child poverty in half,” Biden said at a roundtable in February. With White House press secretary Jen Psaki reiterating the claim in three different beings, the White House backed this statement.
America’s poverty rate is one in seven.
BIDEN: We will halve child poverty.
#Biden address https://t.co/eCmWsLB6cw
– 21st Century American Bridge (@ 21st Century American Bridge)1619660627.0
The bill was passed and promulgated by the President in March and now we are starting to see the benefits of the CTC manifest in real time.
A study by Columbia University’s Poverty Center found that after parents started receiving direct deposits into their bank accounts, it had an immediate effect on child poverty rates.
“Using our innovative approach to track monthly poverty rates, we predict that ongoing COVID relief efforts will continue to have a dramatic effect on reducing child poverty, keeping 6 million children out of poverty. until July 2021 (a reduction of over 40%) ”According to the Poverty Center, the study found that direct deposits from parents’ bank accounts had an immediate effect on child poverty rates.
The researchers believe that as the rollout continues, “the expanded child tax credit has the potential to further reduce child poverty.” If all eligible children are enrolled in the program, the CC has the “potential on its own to reduce monthly child poverty by up to 40%”.
When combined with other measures to help COVID-19, the CTC could help reduce child poverty by 52%.
A Census Bureau survey found that most families spend money on clothing, food, shelter, and utilities.
It is essential to ensure that all children eligible for the CTC program are enrolled. This will allow you to maximize the benefits of CTC. An estimated 67 million children are eligible for the program, although the Treasury Department has estimated that it has made payments for 61 million children.
#BREAKING: President Biden calls for extension of ‘tax credit’ payments for children:
“Let’s extend the tax cut through… https://t.co/KUhLolaKtB
– Personal blog media news (@ Personal blog media news)1625689496.0
The spectacular success of the CLC prompted the President and Congressional Democrats to extend the program until 2025. Earlier this month, House Democrats proposed an extension of the tax credit increase and make the funding permanent. The proposal was applauded by family advocates such as MomsRising.
“The expansion of the Child Tax Credit has made historic gains for our families and our economy in 2021, lifting 50% of all children out of poverty and boosting the economy,” said Executive Director Kristin Rowe- Finkbeiner according to CNBC.
Last week, 450 economists signed an open petition calling for the extension of the CTC. “It’s very rare to find an issue where so many economists agree on everything,” Jacob Goldin, assistant professor at Stanford Law School, told CNBC. “But there is just very, very strong evidence that providing additional financial assistance to children who grow up in low-income households gives them great benefits in their lives.”
When a child comes out of poverty, it has a lasting impact on their life. The Columbia Poverty Center says this leads to lower child mortality, improves the health and life expectancy of poor children, and increases future productivity. The Poverty Center estimates that the societal benefits of CTC outweigh its costs by 8 to 1.
The fact that child poverty persists in the richest nation in the world is one of the biggest shames in American life. The CTC has shown that there is a simple and effective way to tackle this serious problem by simply giving people tax relief. Hopefully our leaders realize the impact the CTC has on the lives of children and make it a permanent part of the effort to end child poverty in America once and for all.