Why we must bring back the full Child Tax Credit
It’s been one year since the last monthly Child Tax Credit (CTC) payment was issued.
For six months in 2021, these payments reached more than 61 million children. They lifted nearly 4 million children above the poverty line, reducing hunger and housing insecurity while improving household health and well-being.
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But when lawmakers refused to extend the program and those payments ended, these gains were swiftly undone. Child poverty shot back up and many families again went hungry.
Despite a final push by progressives to revive the expansion before Republicans take control in the House, congressional leaders left the measure out of their final spending proposal for the year.
That is unacceptable. Reviving this program should be a top priority for three reasons:
1. When anti-poverty policies are more inclusive, they’re more effective — and more popular.
When it was first enacted in 1997, the CTC imposed income requirements that excluded nearly one-third of children from receiving full benefits. The poorest households received nothing because they did not have an income to offset with a tax credit.
The American Rescue Plan Act changed this by making the CTC “fully refundable,” extending the full value to children whose parents hadn’t earned enough before.
The legislation increased the amount of these payments without imposing any work requirements.
These monthly payments helped low-income parents continue working by filling the gap between their low wages and what they needed in order to provide for their families.
In 2021, the United States saw the lowest child poverty rates on record. And the credit’s broad inclusivity, supporting the poorest to middle-income families, contributed to its popularity across party lines.
2. Policies that prioritize the poor are good for the whole economy.
Families spent their monthly payments on basic needs like food, utilities, rent and education, putting billions of dollars into local economies. New research shows that an expanded CTC could generate nearly 10 times more in social benefits than it costs each year.
3. Programs like the expanded CTC can revive our democracy.
Before the pandemic, there were 140 million poor and low-income people in the country.
Programs like the CTC helped bring that number down to 112 million.
After the payments ended, Pam Garrison, a leader in the West Virginia Poor People’s Campaign, told her senators, including Manchin: “My daughter’s got an 8-year-old son she’s raising … For a few months she got a $300 a month child tax credit, she wasn’t getting notices about getting her utilities cut off anymore.
“But now you’re cutting her off, before Christmas?” Garrison decried. “You didn’t care about the deficit and inflation when you gave out trillions of dollars to the banks. The only time you care about it is when it goes to us poor and working people.”
Proving that the government can work for everyday people is essential to defending our democracy, which remains on fragile ground as we head into 2023.
For now, our elected representatives have another chance to show that democracy is about caring for one another.
