After Sen. Joe Manchin, DW.Va., killed President Joe Biden’s Build Back Better plan, journalist Luke O’Neil takes testimony from a family who recently lost their credit card money. child tax. “The $600 we received for our two children allowed us to pay for my eldest’s preschool, which was $450 a month, and to have a small supplement for other child-related costs,” said the dad. “We didn’t have to take him out of school, but we definitely got paid after having to factor him into our budget. There have been times when we have had to push things to credit cards or just pay things late to be able to make school payments.
Until 2021, America had no Child Benefit, and as a result about a fifth of all children lived in poverty, by far the highest figure among rich countries.
This is just one of millions of families hurting because of the loss of Biden’s child tax credit expansion, causing child poverty to increase by about 41%. Under Biden, Democrats have carried out the most effective attack on child poverty in American history. Manchin almost single-handedly destroyed those efforts when he killed the Build Back Better plan.
It is important to understand why the Biden child tax credit reduced poverty. In a classical capitalist economy, the only way to earn income is to work or own property. People who cannot work and do not own much will therefore tend to be poor. Indeed, if you look at government survey data, about 90% of people living in poverty are either children, students, unemployed, disabled, retired or carers. This is why the best welfare states in the world provide income to all these groups. Even in the United States, which is extremely poor by European standards, we have social security benefits for the elderly and disabled.
Children are a particularly common cause of poverty because they are not yet working need income to support themselves, because most of them are born when their parents are young and have the lowest income in their career cycle, and because they need expensive child care so parents can get back to work. These costs explain why single mothers have about the worst poverty rate of any group in the country: on top of all these other problems, they often find themselves trapped in a situation where childcare is so expensive that returning to the work makes no sense financially.
Good welfare states have a whole range of institutions to help parents with the expenses of raising children: paid parental leave to allow new fathers and mothers time off from work, subsidized child care or public, free public school and child allowance to help with expenses.
Until 2021, America had no Child Benefit, and as a result about a fifth of all children lived in poverty, by far the highest figure among rich countries. The child tax credit was designed to remedy this problem. Now it had its problems: for one thing, it was inexplicably administered by the IRS instead of the Social Security Administration, which meant that many of the poorest people were missing out on not filing returns. income and could not be reached. But he also had the great virtue that even parents without working income were theoretically eligible, and he increased the payment from $2,000 to $3,000 and $3,600.
The fact that Manchin has not tried to get rid of the normal child tax credit shows that what he is really against is the working class getting money without having to work to earn it.
The old child tax credit (and now, sadly, the current one) required income from work to be eligible, meaning the poorest people who needed the money the most got nothing. When the expanded tax credit was implemented, child poverty fell to just 12% – both the lowest figure in American history and even still an underestimate of the benefits, as many families have been pulled out of extreme poverty without crossing the poverty line. These people have benefited far, far more than those who were already nearly lifted out of poverty and pushed to their limits.
Manchin reportedly hated this particular part of the Biden child tax credit, telling colleagues that recipients would spend the money on drugs instead of child care. That’s probably wrong (studies show that virtually all recipients spent the money on daily necessities), but the fact that Manchin didn’t try to get rid of the normal child tax credit shows that what he’s really against is that the working class get all the money without having to work for it. It’s fine for middle-class people to get benefits if they have income, but not for poor single mothers who can’t afford to work.
After Manchin blocked Biden’s agenda, according to the Columbia University Center on Poverty and Social Policy, child poverty fell from 12.1% in December to 17% in January, representing an estimated 3.7 million children (more than twice the total population of West Virginia) thrown back into poverty. Black children fell from 19.5% living in poverty to 25.4%; Latino children increased from 16.8% to 23.9%. And it looks like if Manchin has anything to say about it, those kids are going to stay poor.
Again, these numbers underestimate the harm, as many families who had at least some Biden Child Tax Credit income, even though they were still considered poor, are now completely destitute.
It’s one of the most barbaric things I’ve seen in politics. It is not reassuring to have proven that a child allowance can reduce poverty, but that is all we have for the moment. If the US government ever works again, restoring a real child benefit should be high on the list of priorities.