Biden’s Dangerous Child Tax Credit Scheme
Joe Biden and senior Democrats on the Hill are crafting an ambitious spending program that would give most children in the U.S. a tax credit of $300 a month for a year. The Democrats want to make the credit permanent, amounting to $3,600-a-year gift to parents with children.
While most Republicans oppose the measure as wildly expensive — $120 billion a year — some Republican senators have expressed interest in supporting a child tax credit. GOP Senators Marco Rubio and Mike Lee have both gone on record supporting the payments.
Under one draft of the plan being discussed, the IRS would be tasked with depositing checks worth $300 every month per child younger than 6, as well as $250 every month per child aged 6 to 17. That would amount to $3,600 over the course of the year for young children, as well as $3,000 a year for older children, the officials said.
Unlike the stimulus checks, the Biden administration and Democratic lawmakers are hoping to make these child benefits a permanent government program that would continue in future years, according to three senior Democratic officials who spoke on the condition of anonymity to discuss internal planning. The current proposal only calls for the expanded benefit to be enacted for one year, after which Democrats widely hope political pressure will force Congress to extend them. The benefit would be phased out for affluent Americans, though the precise income level has not been determined.
Indeed, this sort of entitlement is never rescinded. Parents will factor the credit into their household budgets and will come to depend on the money. Suddenly telling them that the gravy train is over won’t go over very well with voters.
The benefit could prove costly, increasing the federal deficit by as much as $120 billion for one year, according to estimates by the Committee for a Responsible Federal Budget, a nonpartisan group. But it could curb child poverty in the U.S. by more than 50 percent, researchers at Columbia University have found.
I’m dubious about both numbers. The credit may cost $120 billion for one year, but given how eager Congress will be to curry favor with the voters, that $300-a-month figure is likely to rise substantially in coming years. And reducing child poverty in the U.S. is a lot more complicated than throwing money at the problem. I’m sure it will help, but cutting the child poverty rate in half seems more of a guess than a factual figure.
Like the pandemic relief checks, the family would receive the benefit even if the taxpayer owes the IRS taxes.
Democratic lawmakers are also exploring whether the Department of Treasury can set up an online portal for parents to manage the disbursal of the new credit, these people said. The plan would aim to give taxpayers the option of receiving a year’s worth of the tax credit at filing season, rather than every month, should they so choose. Aides cautioned it may take time for Treasury officials to successfully set up a site that could handle millions of such requests. Other Democrats worry whether the IRS will have the capacity to disperse the payments efficiently.
Make no mistake, this scheme would fundamentally alter the way that government addresses the problem of poverty. In fact, most of the people who get this benefit won’t be poor at all. It’s also a step toward trying to increase the reliance of the middle class on government.
If Democrats want to remake America into a democratic socialist nation, they should have the political guts to stand up and say so. Own it. Be proud of it.
Otherwise, why should we be proud of it?
Author: Rick Moran