Biden’s Tweet Rekindles Hope Of A 2023 Stimulus Check: The Expanded Child Tax Credit Briefly Reduced Child Poverty

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The expanded child tax credit stimulus checks were instrumental in momentarily slashing child poverty during the second half of 2021. Even as the monthly payments went out, poverty went down to 5.2% in 2021 from 9.7% a year ago. And now President Joe Biden’s new year tweet has rekindled hopes of further support from the federal administration.

Data from the US Census Bureau revealed that the expanded Child Tax Credit stimulus check was a major public policy success. The increase in the annual amount from $2,000 to between $3,000 for each child led to a drop in the nation’s child poverty rate by half in 2021, the year it was given. It went down from a distressing 10% in 2020 to a significant low of 5% after the Child Tax Stimulus check amount was increased.

The Child Tax Credit stimulus checks temporarily lifted 2.9 million children out of poverty in the second half of 2021. A third of them were below the age of six. Later analysis revealed that 1.6 million children more could have been saved from poverty if every qualified family had received the stimulus check. But the support did not reach them due to multiple reasons.

CTC Stimulus Check Led To Sharp Drop In Poverty Rates For Colored Children

The expansion of the CTC stimulus check also led to a significant reduction in child poverty rates for ethnic groups and multi-racial people. There was a particularly significant drop in the poverty rate for Latino and Black children. But it remains disproportionately high for these groups at 8%, while for indigenous children it is at 7%. This compares unfavorably with whites at only 3%.

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The poverty measures have demonstrated time and again that children and families of color constantly have dissimilar access to economic breaks. This is a result of a generation of discriminatory practices and policies and inequity.

Studies have constantly revealed that dramatically reducing child poverty among children, especially children of color, is an achievable policy goal for America. But the expanded child tax credit payments are because of a victim of federal politics. And without immediate action to set things right, the progress made in 2021 will unravel soon, and child poverty rates will again revert to earlier figures.

The CTC payments are close to President Biden’s heart, and he fought to retain them in their present form. But aside from the Republican intransigence, it was the betrayal by a couple of Democrat Senators that trashed the proposal.

While pandemic relief measures cannot be considered long-term measures, the CTC stimulus checks had effectively reduced child poverty. That should encourage policymakers to confidently move forward to implement effective and lasting solutions.   

Biden could not muster sufficient numbers to push through the CTC payments beyond 2021. He had hoped to push it through 2025 and had the results to back his demand. But the support measures that were successful in drastically reducing child poverty had to be discontinued after the first year. The CTC stimulus checks reverted to the older version with families being limited to $2,000 a year.

Other restrictions were also imposed. The payments will no longer come in as an advance, such as the monthly stimulus checks that they received between July and December 2021. The CTC payments also set right one major flaw. Under the previous CTC payments, children in families with little or no income received only some of the credit or no money at all. This was termed a major flaw by the Center on Budget and Policy Priorities.

This changed with the introduction of the expanded CTC stimulus check. The American Rescue Plan Act led to the credit being made fully refundable. It meant that it was fully available to children in families with little or no income.

The estimated 30% decline in December child poverty was for approximately 50% of all Latino and Black children. It also led to a 20% decline in poverty among Asian and white children and 50% of children living in rural areas.

The group stated that denying credit to children based on the earnings of their parents defeated the very purpose of the CTC payments. The Republicans had instead proposed tying earnings to the credits. To receive the full benefits families would have to earn $10,000 or more in the previous year. Those earning less than $10,000 would have their credits reduced proportionately to their earnings.

stimulus checks

The Child Tax Credits would start to phase out at $200,000 in income for single and $400,000 for joint filers. For every $1,000 earned above the thresholds, the credit would start to be reduced by $50.

President Biden’s New Year Tweet Raises Hope Of Stimulus Check

The intractable Republicans and betrayal by his party men prevented President Biden from realizing his dream of continuing the expanded Child Tax Credit Stimulus Check.

While it was a frustrating wait for Americans in 2022, a tweet by the president on the last day of the year has raised hopes of a change in 2023. The tweet highlighted the accomplishments of the Biden administration last year.

In his tweet, the president mentioned the historic legislation that he stressed would lower costs for working households and senior citizens. The legislation could also protect communities from the rising incidents of gun violence that have been the bane of American society for decades. The president also mentioned raising pay for American workers.

While this was the normal and expected section of his message, the last part has raised hopes. The president admitted that a lot had been left undone in 2022. He added that he expected 2023 would see more progress.

Though there has not been any direct reference to new stimulus checks, many people read more in his tweet. People close to the administration that at this stage, the only payment that is likely to get broad support is the expanded version of the Child Tax Credit stimulus checks.

The President wanted it expanded through 2025 when he signed the American Rescue Plan Act. But the loss of control over the House could make it tough for the president to muster the required numbers to push through this plan.