How Cutting Back the Child Tax Credit Led to Another Year of Poverty
While the economy was a key topic of discussion for the two presidential candidates when they met on the debate stage for the first time on Tuesday, the duel ended without explicit consideration of those most vulnerable to the vicissitudes of inflation and high housing costs. As they outlined their ideas for assisting struggling Americans, neither Vice President Kamala Harris nor former President Donald Trump made mention of a sobering statistic that was released by the Census Bureau earlier in the day: Roughly 43 million Americans live in poverty, among them millions of children.
Although both presidential candidates have endorsed some form of an expanded child tax credit, that topic was barely broached during the debate. “We know that young families need support to raise their children, and I intend on extending a tax cut for those families of $6,000, which is the largest child tax credit that we have given in a long time,” Harris said early in the evening, referring to her plan to update the current child tax credit to levels reminiscent of a 2021 pandemic-era expansion.
This muted discussion came hours after the Census Bureau released new data showing that the child poverty rate ticked up in 2023 to 13.7 percent, an increase of 1.5 percent from 2022. Poverty policy experts say this number should not only be considered in the context of the previous year but also compared to 2021. That’s when pandemic-era relief programs—namely, the expanded child tax credit—contributed to a historically low child poverty rate of 5.2 percent.
The expanded child tax credit implemented by the American Rescue Plan Act in 2021 was only in place for the latter six months of that year, but lifted more than three million children out of poverty during that time. It increased the amount of the credit, distributed it in monthly disbursements, and expanded eligibility to include households too poor to pay income taxes.
The effect of the 2021 expanded child tax credit was demonstrated by its absence, namely, the largest one-year increase in child poverty on record. “It’s one thing to see the statistics, and another to think that this actually represents millions and millions of children that had been in much more economically stable situations in one year, and then much more economically vulnerable ones the next year,” said Megan Curran, the policy director for the Center on Poverty and Social Policy........
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