After Sen. Joe Manchin, D-W.Va., killed President Joe Biden’s Build Back Better plan, journalist Luke O’Neil collected testimony from a family who recently lost their child tax credit money as a result. “The $600 we got for our two kids allowed us to pay for my oldest’s preschool, which is $450 a month, and have a little extra for other kid related incidentals,” the father said. “We didn’t have to pull him out of school, but we definitely are now paycheck to paycheck having to fit it into our budget. There have been times where we’ve had to push things to credit cards or just pay things late to be able to make the school payments.”
Until 2021, America had no child allowance, and therefore reliably about one-fifth of all children lived in poverty, by far the highest such figure among rich countries.
This is just one of millions of families suffering because of the loss of Biden’s expansion of the child tax credit, resulting in an increase in child poverty by something like 41 percent. Under Biden, Democrats conducted the most effective attack on child poverty in American history. Manchin all but single-handedly destroyed those efforts when he killed the Build Back Better plan.
It’s important to understand why the Biden child tax credit cut poverty. Under a classic capitalist economy, the only way to get income is either by working or owning property. People who can’t work and don’t own much will therefore tend to be poor. Sure enough, if you examine government survey data, about 90 percent of people in poverty are either children, students, unemployed, disabled, retired or caring for someone. That’s why the best welfare states in the world provide income to all those groups. Even in the United States, which is extremely miserly by European standards, we have Social Security benefits for older and disabled people.
Children are a particularly common cause of poverty because they don’t work yet require income to sustain, because most of them are born when their parents are young and at their lowest-earning point in the career cycle, and because they require expensive child care so parents can return to work. These costs are why single mothers have about the worst poverty rate of any group in the country: Aside from all these other problems, they often get trapped in a situation where child care is so expensive that going back to work makes no financial sense.
What the child tax credit means for American familiesDec. 15, 202104:22
Good welfare states have a whole complex of institutions to help parents deal with the expenses of raising children: paid parental leave so new fathers and mothers can have time off work, subsidized or public day care, free public school and a child allowance to help with expenses.
Until 2021, America had no child allowance, and therefore reliably about one-fifth of all children lived in poverty, by far the highest such figure among rich countries. The child tax credit was designed to rectify this problem. Now, it had its problems: For one, it was inexplicably administered by the IRS instead of the Social Security Administration, which meant many of the poorest people missed out because they don’t file taxes and could not be reached. But it also had the great virtue that even parents with no labor income were theoretically eligible, and it boosted the payment from $2,000 to $3,000 and $3,600.
The fact that Manchin didn’t try to get rid of the normal child tax credit shows that what he is really against is the working class getting any money without having to work for it.
The previous (and now, sadly, the current) child tax credit required labor income to qualify, 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 percent — both the lowest figure in American history and even still an understatement of the benefits, because many families were pulled up from deep poverty without making it over the poverty line. Such people benefited much, much more than those who were already nearly out of poverty and got nudged over it.
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. This is probably false (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 is really against is the working class getting any money without having to work for it. It’s fine for middle-class people to get benefits if they have earnings, but not for destitute 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 increased from 12.1 percent in December to 17 percent in January, representing about 3.7 million children (or more than twice the entire population of West Virginia) thrown back into poverty. Black children went from 19.5 percent living in poverty to 25.4 percent; Latino children went from 16.8 percent to 23.9 percent. And it seems if Manchin has anything to say about it, these children are going to stay poor.
Again, these figures understate the harm, because a lot of families who had at least some income from the Biden child tax credit, even if they still counted as poor, now are utterly destitute.
It’s one of the most barbaric things I’ve seen in politics. It’s cold comfort to have proved that a child allowance can cut poverty, but it’s all we have at this point. If the American government ever functions again, restoring a real child allowance should be at the top of the priority list.