I know- the current thinking (I AM being generous here) in DC is that if the ‘other side’ proposed it, it has to be bad.  To say I’m fed up with that crap would be among the greatest understatements since someone claimed Donald Trump was a scoundrel.

So, let’s consider this idea floated by Mitt Romney.  His Family Security Act  would have the US  provide $ 4200 annually for every child under the age of 6 and $ 3000 annually for kids who reached the 6 year threshold until they attain 17 years of age.   These funds- not to exceed $ 1250 monthly- would be deposited directly into a bank account.  (This is a great way to help folks who are unbanked, as well- typically they are the poor.) The program would diminish payments to filers who earn $ 200K or more (or couples earning $ 400K) .

The plan is his attempt (the Democratic Party had it’s own one-year concept) to eradicate – or at least greatly attenuate- child poverty in the US.  Because (no surprise here) the US has the HIGHEST rate of child poverty in the world.  And, that was before the COVID-19 pandemic; now that situation is even worse.

Romney’s plan would cause child poverty to drop about 32% (removing some 3 million kids from the rolls), with 1.2 million no longer among those in “deep poverty”.  (This would be a 50% reduction in that level.)  Of course, Romney’s plan would not be extended to any child that lacks a social security number (i.e., not an American citizen).   Romney’s plan (these are his numbers) should cost about $ 120 million next year.

Senator Romney (and the GOP, in general) wants to kill TANF (Temporary Assistance for Needy Families [part of the Welfare for work system]) and federal tax credits for working families and children. That’s the trade-off for his expense   But, then, even some in the GOP (Mike Lee, Marco Rubio) object to this concept because it smacks of universal basic income.  (Like that is a really bad idea for folks that are poor and unemployed, right?)

Actually, it’s not a bad plan.  Of course, I believe we should start attenuating the benefits for families making no more $300K (singles of $ 150K)- with total eradication complete at the $ 400K ($200K single) income level- for starters.   (Romney chose his limits because they match those that apply for the existing child credits- which I maintain need to be pared back for those wealthier citizens.)

If Romney’s numbers are correct (as confirmed by the Niskanen Center) , then my version of his plan would cost considerably less than $ 120 million (somewhere on the order of $ 100 million).   And, instead of killing TANF, we could arrange to use the funds saved from the Earned Income Credit (EIC)- $ 62 billion, but that includes benefits for folks who have no kids.  That portion of the EIC must continue, to create an incentive for folks to keep working, even though their income levels are low.  (The estimate is that the EIC that is child related runs close to $ 50 billion.)  The rest of the funds would come from replacing the child credit that already obtains, at a cost of $ 57 billion.  In other words- we could make Romney’s plan totally revenue neutral.

And, to ensure that there are no shenanigans, I would want the law written such that if funding is elected to terminate for any reason, the EIC and child credit that obtained in 2020 would immediately come into play.

I began exhorting folks on the Democratic side to join the fray.  And, then a few days later (about three days before this will post), we got an answer…

Richard Neal, chairperson of the House Ways and Means Committee (the committee that controls the taxes and budgets) proposed a 22 page bill that differs slightly from Romney’s great idea.  With much better limitations, I might add.

Under Neal’s proposal, kids under 6 would receive (ok, their parents would) $ 3600 annually; once they cross that 6 y threshold, the allotment would drop to $ 3000 per annum.  Moreover, for folks earning more than $150K (singles of $ 75K), the allotment would begin attenuating.  The program has an intended start of July to afford the IRS enough time to react.\

That works!  A bipartisan compromise.  Horrors!

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