Child tax credit

Congress has failed millions of children stuck in poverty

Amid the darkness of COVID, there emerged a bright ray of public policy that promised to do something so amazing it should be welcomed by all: eradicate child poverty in the United States.

Yet just when achieving this goal was within our collective reach, a dark, unsubstantiated suspicion about the parents of poor children helped upend the effort.

In 2020 and 2021, federal resources through earned-income tax credits and three rounds of direct checks to Americans reduced poverty to its lowest level on record.

But no measure was as significant as the child tax credits, which reduced by nearly half the number of children living in poverty.

The percentage fell from 9.6% in 2020 to 5.2% in 2021 — an incredible achievement.

Child tax credits have existed with little controversy since they were established in 1997 as part of the Taxpayer Relief Act. But in early 2021, Congress expanded the tax credits as part of President Joe Biden’s American Rescue Plan.

The expansion increased the maximum size of the benefit and made it fully refundable and available to all families with children. The credit was distributed in monthly payments.

Half of the credit was distributed from July through December 2021, and the other half was distributed after parents filed their taxes in 2022.

The success of the child tax credit expansion showed what’s possible when policymakers focus on improving the lives of children and their families.

But because of a lack of support from congressional Republicans and some congressional Democrats, the expansion wasn’t made permanent and expired at the end of 2021.

One key contributor to Congress’ unwillingness to make the expansion permanent was the unfounded and insidious suspicion that parents would use the money to buy illegal drugs.

One of the more prominent voices of this concern was Democratic Sen. Joe Manchin, of West Virginia, who shared this view in private conversations with other senators.

But a study published this month refutes that talking point. A team of researchers led by J. Travis Donahoe of the University of Pittsburgh studied more than 40,000 parents and nonparents during the half-year period in 2021 when the federal government sent monthly checks to all parents for as much as $300 per child.

In their report, the researchers wrote, “This evidence does not support policymaker concerns about increased parental substance use outweighing the substantial benefits of (advance child tax credit) monthly payments to low-income children and families.”

In fact, the data revealed that parents receiving the checks cut down on smoking as opposed to nonparents. This may have been because they were under less stress thanks to the payments.

That any legislator — or anyone, for that matter — would assume, without evidence, that parents would use money intended to care for their children on drugs speaks to a class bias.

The assumption is never made that the wealthy will use their tax cuts to purchase illicit drugs or that homeowners would put their mortgage interest deduction toward getting high. But that happened here, and it ultimately hurt children.

What’s been lost with this lie and the cessation of the child tax credit expansion? In 2022, according to the U.S. Census Bureau, the child poverty rate more than doubled, rising to 12.4%. In 2023, nearly 14% of American children — or 10 million of them — lived in poverty.

Having come so close to ending child poverty in the United States, seeing that it’s within our power, shouldn’t we renew that quest? This time, without slandering the parents of the families we should be trying to help.

—San Antonio Express News Editorial Board