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child poverty
Trump Adviser Who Loves Corporate Giveaways Says He Has 'Doubts' About Child Tax Credit
"Trump's economic adviser is openly trashing a tax cut for working families that lifted millions of children out of poverty," said a spokesperson for Democratic nominee Kamala Harris' campaign.
Aug 28, 2024
An outside economic adviser to Republican presidential nominee Donald Trump said this week that he has "doubts" about the Child Tax Credit, a program that Democratic lawmakers and President Joe Biden expanded in 2021—briefly slashing the nation's childhood poverty rate in half.
Heritage Foundation fellow Stephen Moore, a co-author of the far-right Project 2025 agenda, said in a C-SPANappearance on Monday that the Child Tax Credit (CTC) "worries" him because "we can't just keep giving people money"—an argument that he doesn't seem to apply to wealthy individuals and profitable corporations.
Moore proceeded to trot out a well-worn and debunked right-wing case against the credit and other benefits for lower-income households, saying that "if we keep just passing out free money to people, you're going to discourage people from working."
Watch:
Q: Does the child tax credit help children?
Trump 2024 economic advisor: I have some doubts about it. We can’t just keep giving people money. The child tax credit discourages people from working pic.twitter.com/BwmxH0yJMe
— Kamala HQ (@KamalaHQ) August 28, 2024
Moore, whom Trump once selected for a seat on the board of the Federal Reserve, is an outspoken champion of further slashing the corporate tax rate. The Washington Postreported last year that Moore personally urged Trump to support reducing the corporate rate from 21% to 15%, a change that would hand the nation's 100 largest companies an annual tax break of nearly $50 billion.
Additionally, the Project 2025 agenda that Moore helped craft would cut taxes for households making more than $10 million a year while raising taxes on the typical family of four, according to an analysis released Wednesday by the Center for American Progress (CAP).
"Project 2025's new tax bracket system," wrote CAP's Brendan Duke, "represents an enormous shift of the tax burden from wealthy tax filers to middle-income tax filers."
Project 2025 also calls for tax reform that "eliminates most deductions, credits, and exclusions," without specifically mentioning the CTC.
While the Trump campaign has unconvincingly sought to distance itself from Project 2025 as it becomes increasingly clear that the U.S. public widely opposes it, Moore has described the agenda as a "dream scenario."
"Donald Trump and his Project 2025 allies are hellbent on raising taxes on working families, while promising handouts to their billionaire donors."
Democratic nominee Kamala Harris' campaign seized on Moore's C-SPAN appearance on Wednesday, saying in a statement that "Trump's economic adviser is openly trashing a tax cut for working families that lifted millions of children out of poverty."
"Donald Trump and his Project 2025 allies are hellbent on raising taxes on working families, while promising handouts to their billionaire donors," said Joseph Costello, a spokesperson for the Harris campaign. "In stark contrast, Vice President Harris is fighting to cut taxes to put thousands of dollars back in the pockets of working families."
Moore's comments on the CTC came roughly two weeks after Sen. JD Vance (R-Ohio), Trump's running mate, expressed support for more than doubling the tax credit, which in its current form provides up to $2,000 per child annually to families that qualify.
But last month, Vance skipped a vote on legislation that would have expanded the CTC, opting instead to visit the U.S.-Mexico border for a photo-op.
"If JD Vance sincerely gave a whit about working families in America, he would have shown up," Sen. Ron Wyden (D-Ore.), the chair of the Senate Finance Committee, said of Vance in a statement earlier this month. "Bottom line, the guy's a phony."
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Expanded Child Tax Credit Would Give Boost to 6 Million Poor Children
Ample research indicates that providing additional income to families with low resources yields significant, lasting benefits for young children’s health, education, and future earnings.
Mar 20, 2024
The House-passed bipartisan tax bill would expand the Child Tax Credit for 16 million children in families with low incomes—including 5.8 million young children (under age six)—in its first year, bringing them up to or closer to the full $2,000-per-child amount that children in higher-income families receive. The Senate should pass it without further delay.
Young children of all races and ethnicities would benefit from the bill’s Child Tax Credit expansion. Overall, the expansion would deliver a larger credit to 1 in 4 children under age six. It would benefit even larger shares of Black, Latino, or American Indian or Alaska Native young children, whose parents are overrepresented in low-paid work and may face more limited economic opportunities due to historical and ongoing discrimination and other structural barriers.
Looking at these children under six, we estimate that:
- 39% of all Black;
- 37% of all Latino;
- 34% of all American Indian or Alaska Native;
- 16% of all white; and
- 15% of all Asian children of these ages would benefit.
The expanded Child Tax Credit would provide meaningful support to families. Consider, for example, a married couple with a kindergartner, a toddler, and a newborn. One parent earns $30,000 as a cashier while the other parent stays home to care for their children. The expansion would boost this family’s credit by $1,275 in the first year, helping them afford groceries, utility bills, and other necessary expenses.
Ample research indicates that providing additional income to families with low resources yields significant, lasting benefits for young children’s health, education, and future earnings. The Senate has an opportunity to help 1 in 4 children under age six. Lawmakers should act quickly to pass the bipartisan tax package.
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Census Data Show Poverty Is a Policy Choice
The substantial weakening of welfare state programs that had protected families from economic deprivation in 2021 resulted in poverty increases across all major racial and ethnic groups last year.
Sep 13, 2023
Economic relief measures enacted in response to the pandemic strengthened the U.S. social safety net and made a historic dent on poverty in 2021. New Census Bureau data show that the expiration of these key programs caused a significant increase in poverty last year, with the number of children in poverty more than doubling.
Bold policy initiatives such as economic impact/stimulus payments and the expansion of the Child Tax Credit (CTC) helped to shelter millions of people from poverty during a time of social and economic uncertainty at the beginning of the Covid-19 pandemic. For example, the Census Bureau’s most accurate measure of poverty—the Supplemental Poverty Measure—showed that poverty declined by more than 30% between 2019 and 2021, reaching a historic low of 7.8% in 2021. During the same three-year period, child poverty declined by more than half, reaching a historic low of 5.2% in 2021. Importantly, gains during this period were observed across all racial and ethnic groups.
New poverty data for 2022 show that all these gains in poverty reduction have now disappeared. More than 40 million people in 2022 fell below the poverty line, an increase of over 15 million (see Figure A). The substantial weakening of welfare state programs that had protected families from economic deprivation in 2021 resulted in poverty increases across all major racial and ethnic groups last year, further deepening the disadvantages of historically marginalized individuals and families.
Families with children were disproportionately affected by the expiration of the enhanced Child Tax Credit and other relief measures. The supplemental child poverty rate more than doubled between 2021 and 2022, marking a significant regression in child welfare with nearly 9 million children falling below the poverty line. In 2021, the expanded CTC had helped lift close to 3 million children from poverty. In 2022, the expiration of the CTC and other economic security initiatives meant that over 5 million more children were counted as poor relative to the year before. Poverty also continued to affect children of color unevenly, with Black, Hispanic, and American Indian and Alaska Native child poverty rates more than twice as high as their white, non-Hispanic peers.
To isolate the role of government benefits and taxes in reducing poverty, Figure B shows the number of people in poverty on a pre- and post-tax-and-benefit basis. There was essentially no change in overall poverty on a pre-tax basis, with the number of people in poverty hovering between 78.2 to 78.4 million. In contrast, post-tax-and-benefit poverty counts rose sharply between 2021 and 2022, in line with the removal of the expanded CTC and economic impact payments.
Figure B also demonstrates that rising prices played little-to-no role in the large increase in poverty. While high inflation curtailed many families’ incomes in 2022, labor market gains completely offset inflation at the bottom of the income distribution, as household pre-tax incomes through the bottom 30th percentile changed little between 2021 and 2022. Overall pre-tax poverty did not change last year, and poverty only increased using a broader measure of economic hardship that includes post-tax income.
There is also reason to think that the magnitude of the poverty increase was substantially larger than these figures suggest. Census models estimating the mechanical reduction in poverty due to the Child Tax Credit significantly understate the size of payments received by families near poverty thresholds in 2021. As a result, poverty in 2021 may have been lower than we thought, raising the measured magnitude of the poverty increase in 2022.
Although the strong labor market of 2023 will surely help to improve living standards and reduce poverty, it will nevertheless fall short of undoing the damage of letting key social assistance programs expire. Today’s data indicating a sharp increase in 2022 reveal how much poverty the country tolerates is a policy choice.
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