Stimulus Update: 3 Things That (Probably) Need to Happen Before an Expanded Child Tax Credit Is Renewed
- Little is likely to be accomplished before midterm elections.
- Children lifted out of poverty by Child Tax Credit payments in 2021 are right back where they started.
Political infighting may not spell the end of expanded Child Tax Credit payments.
Many Americans are still hoping to see a renewed version of the expanded Child Tax Credit hit President Biden's desk for signature. The harsh political landscape makes the chances of that happening anytime soon relatively slim, however. If the following three things were to occur, Americans with children just might have a reason for renewed hope.
1. Get past the midterm elections
As the name implies, midterm elections happen every two years (halfway between presidential elections). During midterms, voters choose one-third of senators and every member of the House of Representatives.
Needless to say, partisan politics become louder and harsher than usual in the months leading up to the midterm elections. And here's why: Since 1856, the majority party has changed 18 times -- and more than three-quarters of those changes occurred during midterm elections.
The stakes are high this year, particularly for Republicans. Democrats currently hold the majority in both the House and Senate. Republicans are hoping voters are unhappy enough to vote them back into power (which would be keeping with tradition).
However, polls indicate that this year may be more challenging than expected for Republicans. Due in large part to gerrymandering, Republicans are likely to take the majority in the House, but what will happen in the Senate is a tough call.
What does all this have to do with renewing the expanded Child Tax Credit? No party wants the other to get credit for a program that lifted 3.7 million children out of poverty in the last two quarters of 2021.
Because politicians do what politicians do, there's little chance the expanded Child Tax Credit will be renewed until after the midterm elections in November.
2. Public support must be heard
If there's one thing legislators care about, it's public perception. The more constituents who contact their representatives to voice their support for the expanded Child Tax Credit, the more likely lawmakers are to move forward with renewal.
When the program ended in December 2021, organizations that work with the poor rallied to express their concerns about what would happen to the children who were about to fall back into poverty. And in May of this year, the Conference of Catholic Bishops sent a letter to the House and Senate, asking lawmakers to get the expanded Child Tax Credit back up and running.
The letter read, in part: "Families struggling to make ends meet received much needed relief in 2021 through an expanded Child Tax Credit. They were able to use the credit to meet basic needs, with many spending it on food, utility bills, rent or mortgage payments, clothing, and education costs. This credit was extremely effective at reducing child poverty, with some reports indicating a nearly 30% decrease. With the expanded credit now expired, child poverty is rising sharply. Addressing this poverty is a moral imperative of the highest priority."
3. A compromise must be reached
While Democrats continue to stand behind President Biden's original Child Tax Credit plan, a group of Republicans, led by Sen. Mitt Romney, have proposed their own form of Child Tax Credit. This new plan allows for a child allowance of $4,200 per child under the age of 6 ($350 per month) and $3,000 for children ages 6 to 17 ($250 per month). The maximum a household would be eligible to receive per month would be limited to $1,250.
Romney's plan has critics, including those who do not appreciate that it includes changing the Earned Income Tax Credit, a wage subsidy that helps low-income workers.
If the expanded Child Tax Credit is revived, it will take compromise from both sides of the aisle. And while compromise may be difficult for lawmakers to swallow, it's probably the only hope families have of monthly Child Tax Credit checks hitting their bank accounts once again.
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