Progressive Democrats are rejecting Sen. Joe Manchin’s (D-West Virginia) demand to apply means-testing to the child tax credit.
The expanded child tax credit is projected to have cut child poverty in half when it was passed in the stimulus package earlier this year. Despite its powerful effects, however, Manchin has reportedly demanded severe limitations on the tax credit, telling the White House that it must come with a strict work requirement and a family income cap of $60,000. If two people in the family work, in other words, they would only qualify if they made only an average of $30,000 a year each, or roughly less than $15 an hour.
Manchin’s plan would dramatically reduce eligibility for the credit, which is, in fact, already means tested. The American Rescue Plan gave families between $2,000 and $3,000 for each child, with couples making up to $150,000 or single parents making up to $112,500 getting the full credit.
Progressive lawmakers have slammed Manchin’s plan. “I can’t believe I have to say this, but it is a terrible idea to cut the Child Tax Credit, one of the most popular policies with the American public,” wrote Rep. Ilhan Omar (D-Minnesota) on Tuesday.
Rep. Jamaal Bowman (D-New York) alluded to the poverty-reducing effects of the child tax credit. Pointing out that child tax credits are in the mail or in bank accounts, Bowman said, “Poverty is a policy choice and we need permanent solutions to eradicate it and Build Back Better.”
Moderate Democrats are also criticizing Manchin’s insistence on limiting the proposal. “If they want to bring down the eligibility for families making $200, $300, $350, $400K, I’m fine with that,” said Sen. Sherrod Brown (D-Ohio), according to Politico. “But the fact is this has been the most effective, quantifiable, provable answer to child poverty that we’ve done in a generation. Comparable to what the Affordable Care Act did. Why would we scale that back?’
Brown, a longtime proponent of the tax credit, said that the proposal is “too important” to be subject to such a drastic cut as Manchin is suggesting, and added, “We’ve already compromised on this, we wanted 10-year permanence. And now we’re looking at 3 to 4 years.”
Manchin and fellow conservative lawmaker Sen. Kyrsten Sinema (D-Arizona) have, indeed, already forced Democrats to ponder severe cuts to the Build Back Better Act. Whereas the bill as it was presented by Sen. Bernie Sanders (I-Vermont) earlier this year had a 10-year timeline for all of its programs, the caucus is now looking at cutting tit for crucial programs in order to fit in the small budget that Sinema and Manchin will allow.
The child tax credit has been an important tool to reduce poverty during the pandemic. Even in the first month of its implementation, over half of families who received the credit said it helped reduce financial anxiety, according to an August poll. Some families have reported that the tax credit has been life-changing, by freeing up funds for essentials like food, clothes or school supplies.
“There is no reason to cut this life-changing program. In fact, we should be making it permanent, which is exactly what [the Congressional Progressive Caucus is] fighting to do,” wrote Rep. Mondaire Jones (D-New York).
Other progressive lawmakers have pointed out that most means-testing programs don’t actually save money and only increase bureaucracy. “Means testing doesn’t actually save money. It only makes programs harder to administer, forces people to jump through hoops to get needed benefits and continues cycles of poverty,” wrote Rep. Andy Levin (D-Michigan) on Tuesday.
Indeed, at best, means testing just makes it harder to implement programs designed to help the public. At worst it becomes so burdensome for the families in need of aid that many people aren’t able to participate in the program. Many are daunted or barred by piles of paperwork — and, as many people with disabilities have experienced, they may face surveillance.
As Manchin has demanded more means testing for the tax credit and for the reconciliation bill in general, lawmakers have criticized the idea. In an op-ed by Jones and Rep. Katie Porter (D-California) in the Washington Post last week, the lawmakers pointed out that programs like Medicare and Social Security aren’t means tested, which is part of why they’re so successful and popular. “For Biden’s agenda to meet its potential, we must heed the lessons of the past. That means making our investments universal,” Jones and Porter wrote.
