Since July, all but the most affluent families across the country have been receiving child tax credits as monthly cash payments — a first-of-its-kind policy jujitsu that converted a tax break, usually given out as a lump sum at the end of the financial year, into an additional income that expanded America’s safety net.
The program constituted the first dramatic shift of American government support for families in decades. Since the 1990s, the child tax credit was provided only to parents who were actively working or looking for job, making the United States an outlier among other industrialized countries where subsidies for children are popular.
President Biden’s $1.9 trillion American Rescue Plan, in addition to refashioning the tax credit into monthly checks, raised the total amount parents and other caregivers received and stripped it of all work-related requirements, making more money available to more households.
The project, which was initially meant to continue for six months, has finally winded down with the last of the checks handed out on Dec. 15.
Democrats had intended to make the tax credits permanent as part of Mr. Biden’s Build Back Better proposal. But this week, the administration’s huge domestic agenda was successfully stopped, at least for now, by the centrist Senator Joe Manchin III, Democrat of West Virginia, who supported for the child tax credit expansion when it was first introduced but did not back its continuation.
“I cannot vote to continue with this piece of legislation,” Mr. Manchin said on “Fox News Sunday,” citing fears that the Build Back Better plan would contribute to the national debt and growing inflation.
The reasoning echoed that of his Republican colleagues — Senator Lindsey Graham, the top Senate Budget Committee Republican from South Carolina, branded the administration’s plan as a “inflation bomb” — who were united in their opposition to the Build Back Better legislation.
Experts have noticed that after the payments of up to $300 per kid started flowing in bank accounts, among other Covid-related aid, child poverty decreased to record lows.
In an October study by the Census Bureau, about half of the roughly 300,000 recipients polled reported using the money on food – a sign that the tax credit was also helping to reduce down hunger and food insufficiency. Many recipients also reported spending the monies on child care and school supplies.
Interviews with four families showed various day-to-day needs they utilized the funds for — from doctor’s appointments to car maintenance — and the joys of a little breathing room for households that may otherwise live paycheck to paycheck.