Fight to Make Child Tax Credit Permanent Critical to Reducing Child Poverty

Interview with Ben Anderson, director of health policy at the Children's Defense Fund, conducted by Scott Harris

The $1.9 trillion American Rescue Plan, one of the largest stimulus bills in U.S. history, is best known for providing $1,400 checks for millions of Americans. The package allocates funds in direct response to the widespread economic hardship triggered by the coronavirus pandemic, while also addressing long-standing social, health and financial challenges that were exacerbated by the health crisis.

The relief package includes $350 billion in long-sought assistance to state and local governments which have seen their budgets depleted by the pandemic. Additionally, the bill earmarks $31 billion to support Native American tribes in housing, education, healthcare and infrastructure. Five billion dollars will also go to black farmers for agricultural grants, debt relief, education and training.

Some observers have compared the Rescue Plan to Franklin D. Roosevelt’s “New Deal” and Lyndon B. Johnson’s “Great Society” programs, because the bill also temporarily expands the child tax credit from $2,000 per child to as high as $3,600 for the 2021 tax year, which is expected to cut the number of Americans living in poverty by one-third and reduce child poverty by almost half. Between The Lines’ Scott Harris spoke with Ben Anderson, director of health policy at the Children’s Defense Fund, who assesses the importance of expanding the Child Tax Credit and the fight now underway to make that expansion permanent.

BEN ANDERSON: This is really a massive down payment on cutting child poverty in the U.S. Folks who have children are probably familiar with the child tax credit — probably get questions from an accountant or if you get assistance in doing your taxes, it’s something that comes up in those discussions. But it’s a credit that’s available to families with children under the age of 18. The recent changes increase that credit to $3,600 per child for children under the age of 6 and $3,000 per child for children ages 6 to 17. And what’s unique about this particular change, there’s a provision that will also make the credit available in monthly installment payments. So with most tax credits you know, you have to wait till the following year to claim the credit for the previous tax year. With this provision, those payments will begin in July and will be issued monthly for a year.

Now I noted that this is really, you know, a down payment on cutting child poverty and that’s because of that expiration date. This is not something that’s permanent at this point. And of course, something that we’re very interested in seeing through to make it permanent.

SCOTT HARRIS: Could you talk a little bit about the difference or the overlap in the earned income tax credit that a lot of families benefit from?

BEN ANDERSON: Sure. So the child tax credit is really focused on whether or not you have children and it’s available to families who are also middle income and upper-middle income. The earned income tax credit, on the other hand, is also available to many families with children. And if you have children, it impacts your eligibility, but the earned income tax credit is only available for lower income families. So the difference with the child tax credit is it’s more expansive in a number of ways.

SCOTT HARRIS: Thanks for that, Ben. One thing I think that’s important to talk about is beyond the individual families that will benefit from this increased tax credit is the benefit to the country as a whole. Maybe you could speak to that. Poverty is not an isolated problem. If there are families that are poor in a community, it really has a ripple effect, does it not across their city, state and the country?

BEN ANDERSON: Absolutely. Letting millions of children live in poverty is actually quite expensive to society. We see increased costs in a variety of systems from education to healthcare. Children who live in poverty often struggle more in school on average. They sometimes will struggle to get into college, less likely to succeed later in life. And all of these things come with a cost that really adds up. Those costs can be avoided and completely offset by alleviating the problem, by alleviating the issue of child poverty from the beginning.

SCOTT HARRIS: There’s really now a growing coalition of groups in the federal legislature and across the country that want to make the expansion of the child tax credit permanent, not just one year. And there’s a lot of folks who believe once this tax credit’s in place, it’s going to be hard to remove. But we know there are a lot of conservative politicians, Republicans in Congress that have always opposed these types of programs.

BEN ANDERSON: Yes, that’s right. You know, I think it’s unfortunate that an issue like child poverty can sometimes have a tendency to become partisan. It’s not a partisan issue, right? There are poor kids in blue states and red states alike and the impacts are just the same.

SCOTT HARRIS: What is your organization doing to organize support to make these child tax credit changes permanent? I imagine there’s a larger coalition that’s also at work right now to try and make those changes permanent.

BEN ANDERSON: Yes, that’s right. You know, we have partners in D.C. as well as states across the country that are focused on these issues. We focus on raising up the stories and the needs of children who are impacted by these issues every day. So we talk to anybody and everyone, anybody who will listen to us about it and organize folks who are interested to, you know, make their voices heard on the issue, reach out to their elected officials, tell them this is something that absolutely needs to be continued and should not expire. And so, I expect that you’ll hear more from us on that issue in the coming months.

For more information, visit the Children’s Defense Fund at childrensdefense.org.

 

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