Biden must meet Romney in the middle on the child tax credit
Despite the economic currents drowning middle-class parents, Democrats show little appetite for bipartisan fixes, after conservatives won their most prized family policy, reversing Roe v. Wade.
But the angst tormenting progressives must not doom a fresh effort by Senate Republicans, led by Mitt Romney (Utah), to provide economic security and revive tax refunds for parents, easing the bite of rising prices while ensuring children’s healthy growth.
President Biden lowered tax bills for 36 million families with the child tax credit, lifting nearly 4 million children out of poverty with monthly payments — a potent initiative killed by Republican leaders earlier this year.
Yet post-Roe and eager to reinvent a pro-family GOP, Romney wants to restore Biden’s original tax benefits, coming close to enacting an income floor below which no parent would fall.
Romney’s Family Security Act 2.0 would award parents $4,200 a year for each child under 6, and $3,000 for older youngsters under 17. His tax credits, reducing dollars owed to the IRS, would better Biden’s by almost 20 percent. Most poor families would net more in cash refunds than federal taxes owed, yielding a universal basic income long embraced by progressives.
Few doubt Romney’s sincerity in helping struggling parents. “Families provide the bedrock of our nation,” he emailed to me. “But there’s perhaps never been a more challenging time to raise children.” Romney includes a $2,800 payment to pregnant women after their fifth month, helping prepare for the newborn’s arrival.
Romney’s bid has drawn deafening silence from the White House and leading Democrats. Biden’s apparent fear of alienating his party’s left flank dashes bipartisan compromise. Two provisions of Romney’s family plan rankle the party’s progressive wing, yet invite a middle ground.
First, Romney echoes the pro-work piety of conservatives, denying the full child credit unless parents are employed and earn at least $10,000 per year. Low-income parents earning a meager $5,000 would receive half the refund per child.
Retirees raising a grandchild, with no taxable earnings, would gain no tax reduction under Romney’s plan. “We shouldn’t punish children simply because their families are struggling to find work,” argues Michael Bennet (D-Colo.), who helped craft Biden’s original tax credit.
Still, job requirements appear in neighboring federal programs. Parents must hold down a job to benefit from the earned-income tax credit, which also refunds taxes to working-poor and solidly middle-class families. Bill Clinton inserted a work prerequisite when “ending welfare as we know it” three decades ago, centering the Democratic Party while alienating stalwart liberals.
Progressive scripture on work incentives now jeopardizes economic security for millions of families. Instead, Biden could meet Romney halfway, perhaps a work requirement that kicks in when children enter school.
More nettlesome, Romney finances his plump tax benefit by slashing $46 billion from the existing earned-income tax credit. These cuts would be deeper than ratcheting up the child credit, increasing tax bills for 7 million low and middle-income parents.
That’s unfair, as Romney would extend tax savings to parents earning up to $400,000 per year. A small tax increase on corporations or wealthy Americans — the former option won last week by computer-chip makers — would better finance Romney’s plan.
This endless shell game in Washington miffs parents, as they watch tax refunds dry up and inflation soar.
Romney does not paper over the economic struggles pulling down families, along with threats to children’s healthy growth. The left-leaning Center for Budget and Policy Priorities in Washington called it, “a welcome development, showing there is bipartisan support for the child tax credit.”
Romney, a father of five, hopes to rekindle the bipartisanship that spirited congressional approval of $1.2 trillion for public infrastructure and gun control legislation, along with $280 billion in aid for semiconductor firms.
Romney assured me that “conversations are being held at the staff level” with Democrats on his plan. A bipartisan tax bill this fall, seeking write-offs for corporate research, could host a compromise package for families.
Biden and Romney would certainly benefit from a late-summer romance. The president desperately needs to deliver for families swamped by rising prices. Republicans will likely lose swing voters in the midterm elections — notably suburban women — unless the GOP visibly lifts households.
Romney may sense what little compassion springs from an imperious state dictating whether a woman grows a family or not. He now hopes to invent a kinder and gentler Republican Party — just maybe boosting the odds that Democrats can deliver for parents and children.
Bruce Fuller, professor of education and public policy at the University of California, Berkeley, is the author of “When Schools Work” (Hopkins).