Progressives like Vice President Kamala Harris are doing the happy dance over the passage of the latest $1.9 trillion federal pork distribution act, also known as the pandemic relief bill.
The Vice President and many in the liberal establishment point to an optimistic analysis by the Urban-Brookings Tax Policy Center that the cash infusion and tax breaks for children would increase income of the poorest one-fourth of Americans by 20.1%. Childhood poverty, they claimed, will be reduced by half because of a caring and benevolent government.
Another study by the Center on Poverty and Social Policy at Columbia University estimated that the guaranteed income provided by the bill will cut the overall poverty rate in the U.S. from 12.3% to 8.2%.
The legislation, in addition to providing free money, continues enhanced unemployment benefits and refundable tax credits worth $3,500 per year for children under 6 years and $3,000 for children between 6 and 18.
So, beginning in July, the new stream of federal government welfare checks disguised as IRS rebates will arrive in monthly payments. The idea is to create a predictable income stream for families.
Less optimistic conservative observers fear that sending no-strings-attached money to parents will move families back to the pre-welfare reform era of the 1990s. It took a Democrat President Bill Clinton to declare an end to no-strings-attached welfare.
Said Scott Winship, director of poverty studies at the American Enterprise Institute, “Child allowances run a very real risk of encouraging more single parenthood and more no-worker families, both of which could worsen entrenched poverty in the long run.”
Entrenching poverty, Winship continued, results in “an over reliance on government transfers, poverty over longer stretches of childhood, intergenerational poverty, and geographically concentrated poverty.”
Progressives, undaunted by past failures, are determined to make the stopgap provisions of the relief bill permanent. The tax breaks and wealth transference in the pandemic bill are due to expire at the end of the year. The benefits could spill over to 2022 as an additional infusion in cash in the form of refunds for tax filers.
Using the IRS as the government agency for redistributing wealth provides ideal cover for tax-and-spend advocates of social welfare. Their goal is a permanent child benefit similar to what many European countries provide.
Indivar Dutta-Gupta, the co-executive director of the Center on Poverty and Inequality at the Georgetown Law School observed that the bill has placed Congress in a position of allowing the provisions to expire at the end of the year. If they do, he warns, “child poverty rates will roughly double on their watch because of a decision they’re making – or they can find a way to extend the provision.”
As progressives rely on fuzzy math and heap blame on lawmakers and guilt on working Americans, the good news is that the best solution to poverty — jobs — is bouncing back. CareerBuilder CEO in an interview on Fox News said, “Half of the states in the United States are seeing double-digit job posting growth, which is really a leading indicator for companies starting to get out there and looking to hire.”