Photo: Mark Story Photos
In the last half of 2021, a massive public policy experiment took place in the USA. And it worked.
The experiment was the expanded Child Tax Credit (CTC), which was part of the American Rescue Plan Act (ARPA). This program provided a small but significant amount of income to all but the wealthiest families with children, based on the age and number of children in the household.
This was a different approach from other social programs in that it covered many people who wouldn’t qualify for other programs because their income was either too low or too high.
The results were startling but hardly unpredictable. Between 2020 and 2021, child poverty dropped by around 46 percent according to the US Census Bureau, reaching an all-time low of 5.2 percent by the end of the year.
I mean, gee, who would have thought that a little money might help people get out of poverty?
There is plenty of qualitative and quantitative research to show what families did with that extra bit of economic security. The short version is that they spent it pretty much where you’d expect: on food, rent or mortgage, home repair, utilities, education, childcare, internet/telecommunications, vehicle/transportation costs, clothing, paying past due bills, work expenses for parents, and savings.
Then there’s this: fewer parents had to sell their plasma to support their families or take out predatory payday loans with outrageous interest rates.
I know many West Virginians who collected stories from parents in our state about where the money went. In one case, they helped pay for a child’s braces. In another, a broken toilet finally got replaced (kinda major if you haven’t been there). A child got a bed of his own. Worn out tires were replaced before winter hit. Utility cutoffs were avoided. Some found better and safer housing. Other kids were able to take part in things they would otherwise have missed, including extracurricular school activities like cheerleading and sports, summer camps, and a first ever vacation.
In a word, the kind of things that make life a bit more livable.
That was the good news. The bad news was that the CTC wasn’t renewed. It reminds me of the old medical joke that the operation was a success, although the patient died. Or so it seems.
The results of the expanded CTC were a big deal for many reasons, the biggest on being that child poverty is expensive. For everyone.
A 2018 study from Washington University at St. Louis calculated that child poverty directly or indirectly cost the US $1.03 trillion in 2015 alone. At the time of the study, that amounted to 28 percent of the entire federal budget or 5.4 percent of total US gross domestic product.
Children living in poverty face hunger, sickness, instability, and a general lack of security, which can have community impacts over a lifetime and beyond. This kind of adverse childhood experience can increase odds of low academic achievement, developmental issues, and behavioral problems. Later in life, it can contribute to the greater likelihood of chronic diseases, shorter life expectancy, substance use disorder, contact with the criminal legal system, mental health issues, and more. It can affect lifetime earnings, intergenerational assets, family relationships, and community wellbeing.
As one might expect, the negative effects of ending the expanded CTC didn’t take long to hit. As soon as February 2022, the Center on Poverty and Social Policy at Columbia University reported an immediate spike in child poverty rates as the program ended, with 3.7 million American children yo-yoed back into poverty.
Researched published last month in the JAMA (Journal of the American Medical Association) Health Bulletin further documented the harm done by failing to renew the CTC. The focus was on the “increased risk of food insecurity and associated adverse health outcomes, including developmental delay, behavioral problems, and school absenteeism, as well as decreased access to preventive care” after monthly payments ended. Special attention was given to children in very low-income households who were more likely to experience food insecurity and less likely to qualify for help as the safety net was scaled back.
What the researchers found was that after the expanded credit ended, the percentage of US households with children experiencing food insufficiency increased, with larger increases in food insufficiency among households with lower income levels. These estimates represent a relative increase in food insufficiency of approximately 16.7% among households making less than $50 000/y, 20.8% among households making less than $35 000/y, and 23.2%among households making less than $25 000/y.”
The report concludes: “Nonrestricted cash transfer programs like the monthly eCTC represent a promising approach to mitigating income instability and reducing food insufficiency among families with children. With the expiration of the monthly eCTC in 2021, additional policies aimed at mitigating the health and economic effects of poverty on children and families are urgently needed.”
The story doesn’t have to end here with a brief respite from poverty for millions of kids only for them to be thrown back into its depths.
Congress still has unfinished business to address as 2022 winds down. It has the chance and the responsibility to revisit this missed opportunity in yearend legislation and restore this vital program, rather than merely cut taxes for rich people and corporations. Specifically, America’s children and families need and deserve a basic monthly credit without cuts in eligibility for very poor or vulnerable families or reductions in other vital programs.
This time around, I hope that our senators open their hearts and minds and take this chance to prioritize our children, youth and families over—or at least as much as—more breaks for wealthy corporations.
This op-ed was originally published in The Charleston Gazette-Mail.
