Tax Cut Or Benefit: Democrats Are Giving Parents Money, But Don’t Know What To Call It
Democrats want to make a $300 per child monthly payment to most families a central part of American life. The idea has widespread support throughout both chambers of Congress, and President Joe Biden on Tuesday referred to it as “the most important among” the remaining parts of his agenda.
Now they just need to figure out what to call it.
In recent weeks, Democrats have variously labeled the payments ― which formally start on July 15 as a result of the Biden administration’s coronavirus relief package ― as a tax cut, as monthly allowances, as child benefits and as an expanded child tax credit. But as they push both to extend the program’s lifespan beyond 2020 and to convince families to sign up, Democrats haven’t settled on one way to sell the payments to the public.
Biden typically refers to it as the child tax credit. Freshman Georgia Sen. Jon Ossoff, however, is traveling the state this week to promote a “major tax cut for Georgia families.” White House chief of staff Ron Klain has also referred to the payments as a tax cut, as has Colorado Sen. Michael Bennet, one of the policy’s architects.
And in two back-to-back Twitter messages earlier this month, White House National Economic Council Director Brian Deese called the “child tax credit” “one of the largest-ever single [year] tax cuts” and a “child allowance.”
Interviews with Democratic strategists, pollsters and congressional aides suggest there may be some method to the nomenclatural madness. Enticing different audiences requires different languages, and there’s no single magic word to make any policy a winner.
The policy itself is an amped-up version of the existing child tax credit, with one notable twist: Democrats instructed the Internal Revenue Service to send monthly checks of up to $300 per child to parents with kids under the age of 17. Parents can receive up to $3,600 per child, distributed monthly through December. (The remaining credit will be given with 2021 tax returns.)
Notably, the monthly checks are also available to parents who don’t make enough money to even pay taxes, which makes the program more closely resemble what many other countries typically call a child allowance or benefit.
The policy, championed by Bennet and Ohio Sen. Sherrod Brown in the Senate and Rep. Rosa DeLauro (D-Conn.) in the House, has deep anti-poverty impacts. And when Democrats first introduced it, that’s where they focused their initial pitch.
“All told, the American Rescue Plan would lift 12 million Americans out of poverty and cut child poverty in half,” Biden said after unveiling the American Rescue Plan in late January. “That’s 5 million children lifted out of poverty. Our plan would reduce poverty in the Black community by one-third and reduce poverty in the Hispanic community by almost 40%.”
Now, the focus has shifted slightly. During his Tuesday speech in Wisconsin, Biden emphasized the credit would “significantly benefit middle-class and working folks.” And while the concept of a child tax credit and tax cuts have a lengthy history in American life, ideas like a “child allowance” or a new entitlement benefit are perceived more radically.
“In a public message, tax credit or tax cut is probably more persuadable,” said one Senate Democratic aide, emphasizing the importance of drawing a contrast with the Trump tax cuts from 2017. “When you look at the distribution of the child tax credit versus the Trump tax cuts, it paints such a perfect picture of what this administration, the Senate majority and House majority is trying to do.”
Democrats also see the “tax cut” messaging as a way to contrast their policies with the tax cuts Republicans passed under Donald Trump’s presidency in 2017, which were heavily tilted toward the wealthy and corporations even if they lowered tax bills for most Americans.
“I think it’s about time there should be fairness in the tax code. I don’t want you paying more than your share,” Biden said in Wisconsin. “But the tax cut that was passed under Trump ― the $2 trillion, not a penny of which was paid for ― where did it go? Over 80% of it went to the top one quarter of 1%.”
It’s a notable change in messaging that could help win over persuadable voters. Recent polling shows Americans — across party lines — are more interested in tax cuts than they are in curbing poverty.
A May survey from the Navigator Project, a progressive messaging operation anchored by two prominent Democratic polling firms, found referring to the child tax credit as a “tax cut” led to increased support and decreased opposition. Among Republicans, the proposal went from a net -10 approval rating to a net zero.
And since several key Democratic senators ― Ossoff, fellow Georgia Sen. Raphael Warnock, West Virginia Sen. Joe Manchin and Arizona Sens. Kyrsten Sinema and Mark Kelly ― hail from Republican-leaning states, the “tax cut” messaging may make sense for them.
“Democrats have to deploy a variety of messaging,” said Ethan Winter, a senior analyst at the left-leaning polling group Data For Progress. “In Republican states, when you have to appeal to Republican voters, calling it a tax cut is an effective strategy.”
But beyond the politics, Democrats also need to spread the word to low-income Americans ― especially those who don’t pay income taxes ― and convince them to sign up. Nearly half of eligible parents have heard very little or nothing about this newly expanded child tax credit in early June, according to Data For Progress’ polling. Some Democrats worry labeling the program as a “credit” rather than emphasizing its near-universality as a benefit could scare off eligible recipients or make it sound too difficult to sign up.
RELATED…
Source: Read Full Article