The child allowance grants were increased as part of the $1.9 trillion COVID-19 relief package, and drastically expands the nation’s welfare state. Some experts called it a move toward universal basic income.
As part of the stimulus, the credit was increased to $3,000 per child from ages six to 17, and $3,600 for children under six. It was made fully refundable, and payable in monthly instillments of $300. Before this, the maximum annual credit was $2,000 for every child under 17.
White House press secretary Jen Psaki was asked on Tuesday for clarity on making the policy permanent, a move some experts had already predicted. The reporter said it looked unsure if the administration was going to pursue making the policy permanent or not.
“The president wants to make the Child Tax Credit permanent,” Psaki told reporters aboard Air Force one. “He believes there’s a lot of proposals out there, including from Senator Romney, to work to ensure there’s longer-term assistance through the Child Tax Credit.”
“And he believes it’s also one of the ways that we can help address the number of women—working women—who have moved out of the workforce,” she added. “But we just have to find a vehicle, and we’re having those discussions with Congress.”
In the stimulus, the child tax credit program removed existing work requirements that would increase credit earned based on a person’s income from work. Some experts describe the plan, if enacted permanently, as “the second-largest expansion of means-tested welfare entitlements in U.S. history,” one Feb. 10 Heritage report noted.
The same report states that “in constant dollars, its annual cost would dwarf the initial costs of the Medicaid, food stamps, and Aid to Families with Dependent Children programs.”
Robert Rector, senior research fellow of domestic policy studies at the Heritage Foundation and a leading authority on poverty and welfare programs, said the child credit program would cost the country about $80 billion a year in cash outlays and about another $40 billion in tax reduction.
The problem is that “it’s unnecessary, and it’s counterproductive,” he told The Epoch Times last week.
“It’s $80 billion on top of a half a trillion dollars that the United States currently spends on cash, food, housing, and medical care for low-income Americans,” Rector added. “And that half a trillion dollars is roughly six or seven times the amount needed to completely abolish child poverty in the United States.”
Most estimates say the cost of these expanded child tax credits will cost the country more than $100 billion, with the Committee for a Responsible Federal Budget identifying the cost at $143 billion annually. It was set to be only a temporary expansion for one year.