child tax credit

40 Racial Justice Organizations Demand Government Bring Back Child Tax Credit: "Poverty Is A Policy Choice"

The group an open letter to Senate Majority Leader Chuck Schumer on behalf of the millions of families that have fallen back into poverty since the tax credit ended.

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A group of over 40 influential racial justice organizations has called directly on Senate Majority Leader Chuck Schumer to take immediate action to reinstate the now-lapsed Expanded Child Tax Credit, a program that ran from July to December 2021.

The program expanded the original Child Tax Credit, a tax refund that initially gave parents an up to $2,000 tax cut at tax-filing time. The expanded credit became a fully-refundable credit, meaning that even the poorest parents could finally take part, and was worth about $3,600 per kid a year. Half of that cash was given out in monthly installments, the other half at tax-filing time. And while the Expanded Child Tax Credit was a whopping success — it lifted 4 million kids out of poverty — Congress let it expire as a result of failing to pass President Biden’s Build Back Better plan.

Earlier this month, leaders from the NAACP, the Economic Security Project, the National Urban League, Unidos, The Leadership Conference, Community Change Action, and others reached out to Schumer via letter to urge him to work to reinstate the plan — as families are struggling to make ends meet. Immediately after the payments ended, some 3.7 million kids fell right back into poverty.

“Now that the Senate is about to start crafting an economic package, we urge you to restart these monthly payments and restore eligibility to immigrant children as the most immediate, meaningful response to higher prices that Congress can deliver to 36 million families, especially Black and Latino families historically left out of the full Child Tax Credit,” stated the letter.

The action came in the wake of reporting by CNBC that nearly 50% of the families who received the monthly payments from the Child Tax Credit could not afford enough food to feed their families five months after the payments lapsed in December 2021. Families that were eligible for the fully refundable advanced payments starting saw results immediate and significant.

Reports show that the monthly cash payments lifted 4 million children out of poverty. The Biden Administration attempted to extend the monthly cash payments, but the landmark infrastructure legislation, the Build Back Better act, was stonewalled by a lone Democratic Senator who disagreed with families receiving a monthly cash payment to shore up family finances.

Senator Joe Manchin instead insisted that families could spend their payments on drugs despite mounds of evidence proving that the majority of U.S. families used their CTC payments to purchase essentials like food, pay rent or utilities, or save for the future.

Despite the obvious and life-saving benefits of the CTC, ground gained was quickly lost once the payments ended. And the letter comes at a time when inflation has skyrocketed, ensuring that basic goods have exploded in price. The inflation rate alone in April was 8.6%, a 40-year-high that affects everything from cheese to diapers to meat.

“Unfortunately, the gains thanks to the expanded CTC, including for Black and Latino families, were erased as soon as the monthly payments ended. In January 2022, the first month without a check since July 2021, 3.7 million children were plunged back into poverty,” explained the letter authors.

“Over the course of 2022, this is expected to increase to 4.1 million. That means the percentage of Black children in poverty will increase from 13% to 22%. Poverty among Latino children will increase from 12% to 21%. While the poverty rate among white children will also increase, it will nevertheless remain nearly two-thirds lower than among Black and Latino children.”

The letter authors also highlighted the dismal timing of the CTC lapse, citing the increase in costs of essential goods.

“Poverty is a policy choice. Allowing millions of children, including more than 2.5 million Black and Latino children, to fall back into poverty is also a political choice,” said the authors. “We urge you to summon the political will and find a path forward so millions of children are not relegated to poverty just months after they and their families were given a lifeline.”

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