Cannot fucking wait until my daughter gets this. She is a single mom, going to school full-time to fix robots, but because she lives mainly on scholarships she didn’t get much of a child tax credit because her income was too low. She has a work-study job which is part time.
She is a great kid doing great, but it will be nice to see her head a little bit more breathing room.
It's interesting comparing coverage of the CTC versus college debt forgiveness in both the mainstream and progressive media. Clearly the CTC will help many more people in need, but coverage of it seems dwarfed by the program laser targeted to benefit young journalists from expensive universities. Another argument for more diversity in the media.
And where are the progressive activists out there arguing to make the CTC permanent?
My wife and I combined fall close to the higher edge of the married couple income range, and we are using the checks for our two kids to pay for the older one's braces, which is an expense we might have otherwise had to finance out, so we are pumped. I have no policy commentary except to say that as a married parent, children are expensive and logistically difficult, and I don't know how single parents (including my own dad back in the day) manage it.
Biden should A) hire a bus covered entirely with big, colorful "CTC" wrap, B) spend all summer long doing nothing but driving around Pennsylvania, Ohio, Michigan and Wisconsin, C) bring a bullhorn.
I can see that the CTC will help a lot of people, that it's really good policy, and that we should make it permanent.
However, I doubt its value for helping us win elections. Obamacare helped 20 million people get access to medicine, most of them poor white people. It is such good policy that it is unlikely to ever go away, yet it's basically a curse word to a majority of poor white people.
You’ve highlighted one of the weirdest issues in American politics: the ungrateful voter syndrome. By my reckoning, changes in social welfare policy are singularly unhelpful in building immediate electoral help. Other topics are always more salient to voters. Not sure why this is, but I’d guess that questions tied to race, religion, and the like are more important to most voters, especially in a mid-term poll.
The key point here is that legislators who think they will be lauded by voters are normally disappointed.
Yep, people who have read my comments here before will not be shocked to learn that I think it's mostly about race.
And I don't think "ungrateful" is the right term. Medium-racist people are very grateful to have political leaders who say what those medium-racist people really feel, just as I am grateful for politicians who explicitly make the antiracist argument.
In Kenya, race isn't a lens, but "tribe" (I don't love the term) plays a major role in how people feel about policy and politicians. Some people want politicians who will pitch an anti-tribalism message, while others want politicians who will use dog whistles (or bull-horns) about the tribes that they dislike.
"the ungrateful voter syndrome" - I think this occurs for the same underlying reason that most progressives aren't super grateful that Bezos (per Propublica) paid almost a billion dollars in taxes over 4 years.
I think it's mostly cursed beginning at the lower middle class. Most of us are having the same experience with health insurance that we had before it appeared, only more so: every year we go to a meeting at work, with a representative from our employer's chosen insurance company (usually a different name than it had the year before). In this meeting, we learn that in the coming year we'll be paying more money for less coverage. Every year.
This feels like a small exaggeration, but only a small one. Lower income people who are full time employees (they are legion) are still having to make difficult decisions about which health care is worth pursuing, and that doesn't appear to be going away.
Yeah, I do wonder about it's political popularity here. I'm a Northern Irish immigrant, so universal child benefit seems to me like a kind of "well, duh, you should have that" type policy. However, I have quite a few co-workers who have a "you're just going to give people a check? . . . because they have a kid? . . . does not compute" reaction to the idea. It has given me some pause that the concept does not really fit with some deeply embedded American cultural values. They should still do it like Matt says though!
I feel like it was a big mistake not to make that bargain with Romney and do his plan instead. Almost as good at eliminating child poverty, gets some of that bipartisan cred that can be used in elections, and most importantly is just permanent. I feel like doing the CTC this was is going for "double or nothing."
Yeah, if the plan gets extended every year it's great, IF. We'll see if Democrats are able to keep getting this thing extended in like 2025 the next time there's a debt ceiling fight with a GOP senate majority and Ted Cruz holds the economy hostage again and demands to kill this or something.
Romney is one vote in the Senate. No other Senate Republicans came out in support of the plan, to my knowledge. And I can't think any House Republicans will back a tax credit associated with "Romney". So you'd need unified Democratic support on a plan that cuts certain anti-poverty credits (albeit, it makes up for those cuts with its tax credit) and pays for itself by further eliminating the SALT deduction (something that certain suburban swing-district Dems care a lot about)... seems unlikely.
In principle, I am all on board for making the expanded CTC permanent. We should be giving struggling families a hand. So sign me up! And yet . . . and yet . . . there are two things that niggle at me:
-- By the mid-1990s, there was a pretty wide consensus that AFDC was a failure and too often it supported a culture of dependency. The CTC isn't quite AFDC, but it bears a strong family resemblance. Have we decided that that view of 25 years ago was totally wrong and we should basically go back to the old system? If so, I must have missed that argument.
-- We need to spend more. Period. But any permanent program has to be paid for (unlike short-term bailouts, Keynesian stimulus programs, etc.) And I don't care if interest rates are low or even if we expect them to remain low. I may be able to manage a $300,000 mortgage at moderate mortgage rates, but if those rates are 0.0001%, that doesn't mean I can afford a $20 million mortgage -- the principal payments alone will kill me. So we have to generate revenue to pay for the CTC and the other things we want and need to do. But there's clearly a consensus in this country that 'ordinary' people (say, under $400,000 in household income) shouldn't see any tax increases. Elizabeth Warren notwithstanding, you simply can't run a Nordic-style welfare state only paid for with taxes on the wealthiest. (Not to mention that if you personally aren't willing to cough up the bucks for something, how much do you really value it?) So how will we get the middle and upper middle class to be on board for paying more for these undeniably good things we want to do?
I don't know the exact details of AFDC, but everything I've read noted that it has a strong work disincentive. Basically it goes away if you start working, so many people decided not to work. Not providing a work disincentive is practically the number one rule of welfare programs, so AFDC was pretty seriously flawed.
The CTC doesn't provide a work disincentive. In fact, the old CTC provided a strong work incentive: you didn't get it if you didn't work. The new CTC has neither an incentive nor a disincentive. That may seem like a small thing, but it really sets it apart from the AFDC. This isn't going "back to the old system".
Yeah, the CTC is given regardless of work status and doesn't really benefit those that don't work. AFDC specifically phased out when the recipient started earning just about any appreciable income.
Maybe our revealed preference is that we don't actually want those things? Most of us have figured out how to carve out a decent life in this country. I recognize it's not great for everyone, and I certainly want to sand off some of the rough edges. But I also don't, for example, want to completely overturn the healthcare system or higher education or (etc.) because so far, few to none of the proposals I've seen actually address the core problems, vs. just wasting money.
I hope you're wrong. I'd like to see us do far more to make this a more equitable society, even if not all policies are a total success. But I fear that your first question may reflect the views of the median voter. That it's not rural state bias in the Senate, Electoral College skews, or gerrymandering that preclude passing these ideas into law and more that most voters are hesitant to see truly bold public policy.
Even if democrats controlled everything, I don't think you would see M4A and free college (to use my two examples). My (possible) disagreement with your vision is that I don't see utopia as basically what we have now, just given to everyone. To continue an example, to fix higher education, I think we need to break the expectation that everyone needs a degree, that those degrees need to take four years, and that universities are the only place to get training. In this regard, I think Matt's full employment goal will actually do more to help than more free money.
Other countries that do have the things you want actually do implement some of the cost controls necessary to make them work, e.g., lower doctor pay, more tracking of students onto different paths, etc. (as I understand these things at least). I'd be more open if I saw the proponents here actually tackling these really difficult issues, but they don't because (1) they may not be interested anyway and (2) since it's politically impossible still, there's no point in bringing up the negative aspects.
I've lived the vast majority of my life in the EU, and after coming to the US I understand why tuition-free college isn't a good idea.
However, I would disagree with you on healthcare. Doctor pay in the EU is lower than in the EU, but all high-paying jobs pay less anyway. To the best of my knowledge, doctors are still the highest-paid employees or something close to that in the EU. On the other hand, you don't get that army of billing experts there, so I mainly view the US healthcare system as a make-work jobs program (but make-work is inefficient).
As a side note, I usually wait for my vacations back home to see doctors, as I trust them more than US doctors. Here, I just have the feeling that the doctor tries to steer me into useless stuff to increase the amount my insurance and I will have to pay.
Sure, I threw doctors under the bus because that's the one I remember, but I agree that there's a lot of really tough budgeting at the provider level in general that would need to happen to get to something like M4A, yet I don't think I've seen any proponents talk about. Even the ACA was a very complex, 1000-page bill and despite being a significantly less drastic change than M4A, it still had many unpredictable consequences.
Sure, I don't believe that M4A is necessarily a good idea. I think that healthcare should be treated like safety. A public tier available to everyone financed by taxes (police), and whoever wants something more can always go private (private security companies).
I have mostly used doctors outside of the public system back home, but I had good bargaining power because they knew I could just go to the public option and pay nothing, if they weren't clearly superior in terms of quality (and they didn't have a good quality to cost ratio).
So, direct provision of services (at the same government level that provides courts/police/firefighting) and optional unregulated private insurance is the optimal system I think. (I think that healthcare is one of the few things that we do better than the US back home.)
>>>I understand why tuition-free college isn't a good idea.<<<
Why isn't it a good idea from your European perspective? I'm genuinely curious. K-12 education in the United States is tuition-free. I don't see the harm in expanding this dynamic to include college. If anything, the statistics I'm aware of suggest the growth of education attainment in America has slowed pretty dramatically in recently years. That is, it's still growing, but very, very slowly, and the US has been overtaken by other high income countries in this area.
I have written a few comments on this in past posts, but I'm not sure how to search for them. If you know, let me know!
Meanwhile, one quick point that I want to make is that it's "easy" to provide tuition-free college in the US. Just make it illegal for public universities to charge tuition. "Tuition-free" doesn't necessarily mean that the university gets from the public as much money as it wants. I think that this action would lead American universities to get closer to European ones in global ranking. (My past comments are much more detailed than this, but I can't find them now.)
All healthcare staff wages in the US is less than 10% of overall health care costs. You can be extremely aggressive at cutting doctor pay and you’re not going to get much overall bang for the buck.
I agree that we're unlikely to have M4A and free college but mostly because those things really aren't popular (or their popularity wouldn't survive any sustained debate). I'm more concerned about things that people are generally in favor of but don't think they personally have to pay for them.
The ghost of '84 Mondale looms large over our political landscape.
So what things do you want to spend money on? I agree that expanding the CTC (or equivalent) is a potentially good one (as you note, we should take care to not fall into the same traps as before). I was extremely encouraged by Romney's (paid for!) proposal and then quite disheartened to see it get zero traction.
I'm not sure my preferences matter, since I'm not the median voter and I'd be fine paying higher taxes for things on my particular wish list, but #1 is to spend vastly more to fight climate change (rewiring our grid, vast expansion of renewables, greatly increasing penetration of EVs into the national fleet, etc.) Build on and expand the structure of Obamacare. Create more of a financial floor for struggling working families. Lots of other things!
I went into the paid labor market when I was 18 and I just don't see how this is a good practice adulthood experience compared to sending people to 13-16th grade and increasing vocational and life skills classes. The labor market, just isn't concerned at all with humanistic development as it should be but most 18 year olds still need a lot of it.
Like the labor market is so much live ammunition. It wasn't intermediate comp that college was good for. It was really good adulthood practice, at least for a life as a professional.
In the not to distant past, I worked with a large number of new employees. 2/3rds were recent college grads while 1/3 were people without degrees but work experience. For most of what we needed, I would take a 22 year old with 4 years of work experience over someone who had been in college for 4 years.
We were going to have to teach them how to do almost everything anyway, might as well get someone whose perception had already been influenced by reality. The amount of recent college grads who were used to being able to skip work, get praise for mediocre work, and pushed back against the idea of doing entry level grunt work was incredible. There were a lot of good people who became excellent workers in there, but I was always shocked by the contrast.
I wasn’t really speaking about making better employees.
Like as an autistic person cooking was never going to teach me the kind of social skills I needed to cope with a post high school world. University made me a much more competent adult beyond just doing a job.
The argument in the 90's was you should only get stuff if you are working. The CTC requires that you work. There is no full time mom with no husband getting money from this.
As to how do you pay for it? it will pay for its self as these children growing up in poverty will no longer grow up in poverty and they will make more money and be taxed more. However that will create a 10-20 deficit.
Not trying to give you a hard time, but the similarities between CTC and AFDC are superficial and it would be wise not to equate them… It’s a bit alarming to see this asked in good faith because AFDC is a big part of the legacy of the “welfare causes dependency” trope, which is true of poorly designed welfare programs.
I can’t remember the episode, but on the Weeds, Matt has described AFDC in terms very much opposite to “very well designed” (or whatever he said about CTC).
As others pointed out, AFDC had a strong disincentive to work, and this was by design: it was originally meant for widowed white women, who weren’t expected to work.
AFDC required that you not work in order to qualify. It was designed to subsidize widows to allow them to maintain their way of life and raise the kids if Dad died. It just didn't age into the 1990s well.
These are great questions. Hope if answers. I think this is where I most diverge with Matt's progressive vision ... specifically the money-printer-go-brrrr approach to fiscal policy as if debt levels are disconnected from the economy and / or can be continually inflated away.
I think continuing Matt's post from yesterday and if you buy his arguments ... we can now say the last round of stimulus was too big, too compressed, and too short-sighted. Probably too soon to tell if we're facing any long-term risks. But I'm certainly not going to discount the possibility of coming systemic economic problems.
Great well written post. But, I already miss Marc the intern's charts. I would love to see how much of an outlier the USA is on poverty, especially compared to recently industrialized countries such in Asia and Latin America or Big African countries like Nigeria.
The letter the IRS sent out is the lamest thing ever. It's dry and doesn't even say if I'm eligible --- just that I'll get money if I am. Way to sell the product.
I thought Trump's letters were tacky and dumb, but it was a smart move. His giant signature grabbed your attention. If Trump hadn't done it already, I wouldn't want Biden to do the same, but that cat is out of the bag. Also, Biden's signature straight up looks nicer than Trump's sharpie monstrosity.
"To recall, the expanded Child Tax Credit puts extra cash in the hands of virtually all American parents, leaving out only the richest."
This seems to be the newly favored way of doing "means testing"--give the money to basically everyone, except the explicitly wealthy. Doesn't this just make programs administratively burdensome while saving virtually no money? Is there any practical reason to exclude the rich?
Giving families money so that children are not stunted by poverty is a fine, empirically supported idea.
The broader natalist argument is hideous. It took 200,000 years for the one billion humans to exist simultaneously. A century and a half later, there are 7.4 billion. Global population is still increasing and won’t peak for decades. As an individual, I like uncrowded parks. As a consumer, I like abundant natural resources. As a pragmatic human, I know the best way to destroy the planet more slowly is for there to be fewer humans.
The U.S. population is still increasing. Highways are gridlocked. Cities are crowded. I pine for vast, open spaces, thinly peopled with tolerant men and women who have time to share wine, conversation and recreation unharried by large families. There are plenty of would be immigrants to change our diapers in old age.
Pro-Natalist policies in Western countries don’t aim to generate huge population increases, they merely are trying to keep the population somewhat closer to the replacement rate of 2.1 children per couple/woman. The best guess at this moment is that global population will max out at 10 billion, so Malthusian fears of overcrowding don’t comport with what is predicted by the demographic community.
I don’t think a Malthusian nightmare is likely, but there are other reasons to avoid population growth. It is a strain on natural resources. It makes open spaces more crowded. There are only a limited number of places of exquisite beauty. The more people who have to share them, the more crowded they will be.
Climate change will lead to lots of bad things. Its not the only thing that can lead to bad things. The developed world relying on Africa and Southern Asia to provide people for the future when they are much more impoverished than we are doesn't seem like a good plan.
I think Matt said in his book that even if we got to the number 1,000,000,000 Americans we'd still only have roughly the population density of France. There is a LOT of open space in the U.S. to both welcome more immigrants and have policies that encourage people to have and support families.
I think one issue with this is there aren’t the policies in place that effectively channel immigrants to the communities that are shrinking where they are needed the most. Instead, people (Americans and High-Skilled immigrants) flock to the superstar cities where there are real issues of housing and it’s unclear if zoning issues will ever really be overcome.
There needs to be federal incentive programs to just make these super cities everywhere coast to coast. Maybe even specify this, I don’t know if this is ethical, but it’s just a thought, specify location of high skilled work visas? Allocate like “These additional 5,000 work visas can only be used in South Dakota.” Or something.
It seems less unethical than the current policy, which says "this work visa can only be used to work at XYZ Corp, and if you want to change jobs, you either have to get federal approval or leave the country".
It seems like states should be allowed to sponsor immigrants, in numbers above the national quotas. The immigrants could be required to maintain residency in the sponsoring State for the five years or whatever it takes to become citizens. Then they'd have a constitutional right to move around, but a lot would stay put.
The fastest growing metro areas in the US include superstar cities like Orlando, Raleigh and Sarasota. NYC, LA, DC and Boston are nowhere near the top. Seattle and maybe now Austin are the only "superstar" cities that make the top 20.
Well yeah, both native born Americans and immigrants are price sensitive. My larger point isn’t that people will never want to move to Orlando, it’s that despite all the land in America enough people aren’t moving to rural areas like West Virginia or old industrial towns like Detroit that are losing or have lost population.
It is probably not a good idea to send immigrants to areas that have declining job opportunities. People are moving away from those places for a reason. Of course, many immigrants do work in rural areas as agricultural workers, but sending people to a location based on low population density seems like a worse choice then current policy which sends them where they can get a job.
Populations are declining in rural communities because rural economies have always been based around resource extraction, something that is not as cost effective in the era of environmental protection and global competition. Putting more people there who have little economic capital is not a great idea.
First, have you ever gone hiking in the Alps? Don’t bother, it’s too crowded. Second, almost all of France has a pleasant or ar least passable climate. If you think western Nebraska should have the same population density as Brittany, I think you should have your head examined.
Whatever America does or doesn't do with respect to natural population growth will barely be a rounding error as the decades roll on. We're just not a very large portion of humanity. Way under 5% and shrinking. If somehow we managed to juice natural population growth via pro-family benefits (I doubt it, how many babies are Finns having?), it would mean our share (absent immigration) of world population would fall a bit more slowly than it otherwise will, is all. If we're going to get anywhere near Matt's vision of 1 billion Americans (and that's pretty damn doubtful, too, although I'd like to think we can reverse our current demographic stagnation) it'll be via increases in immigration.
Not exactly sure what you mean by this. Whose "admission" are you referring to (yours or mine)? What I'm saying is, even if you think a substantial increase in US childbirths were a bad thing, you've got nothing to fear from policies that give money to families with children, as the evidence from other rich countries shows they do little (and in many cases apparently nothing) to increase the birthrate. But on the other hand, such policies reduce child poverty, which alone is a hugely important task (I can think of few goals more worthy) and likely expand the country's long term outlook in terms of economic growth and prosperity (child poverty tends not to be conducive to productivity).
We agree. Child allowances reduce child poverty without greatly increasing fertility. Therefore, I can reject natalism while supporting child allowances.
What you want is incompatible. "Tolerant men and women who have time to share wine" are to be found in cities, not thinly peopled open spaces. City air makes free.
My experience has been different. I live in an outer Atlanta burb. The public schools are good and I have a nice house that is worth $400k. If I lived in Atlanta, (I moved when my child turned school age) I’d have to pay $600k for a smaller house without a pool. The absence of a pool would cost me thousands in travel to escape the heat ever summer. Unless I paid a stiff real estate premium for the Decatur schools, I’d be out $30k in tuition. Those additional expenses would mean more work and less leisure. In Peachtree City, I can live comfortably working 25 hours a week.
Atlanta metro is a large city, not a thinly-peopled open space. It is also one of the most segregated places I've ever seen in America, unless it has changed radically in the past 10 years (I have family connections there, so this is not hearsay). There are some tolerant people there, but I think that extolling the place as a mecca for such is a bit of a stretch.
Your painting of a diverse Rivendell would be… pretty dope. I also don’t think you have to worry much. In most countries where similar plans have been in place. Even when they are specifically transparent about the point of the plan being to make their nation more fecund, things like this have little long term impact on increasing birth rates.
Well… I guess I should clarify. Your diverse Rivendell won’t be impeded by this plan. Our culture however might take some incentivizing before it gives up its love for fried food, football games, binge tv, and 70 hour work weeks and wants to consider more seriously, as my favorite literary hero would say, having a better sense of “theology and geometry.” Myself included.
Rapid increase in immigration causes nationalist backlash and taxing inheritance causes conservative backlash which is just as 'hideous' / counterproductive to our goals (granted conservative backlash over estate taxes is less severe than immigration). I'm in favor of more immigration and at the same time in favor of natalist policies in a country where people desire more children than they currently have and density is relatively low. I think almost all of the issues you mentioned are challenging but solvable. I'm on this blog partially b/c of the One Billion Americans book though.
I get the concerns about resource strain, but I also wonder what will happen in South Korea where at some point in the near future about half the population will be over 65.
Have you seen any of the discussion about the disproportionate balance in the Senate for rural states and how the government should represent people not geography? Republican's represent far more "land area" than Democrats, but Democrats represent more people. Sounds like you should move to a red state.
Cannot fucking wait until my daughter gets this. She is a single mom, going to school full-time to fix robots, but because she lives mainly on scholarships she didn’t get much of a child tax credit because her income was too low. She has a work-study job which is part time.
She is a great kid doing great, but it will be nice to see her head a little bit more breathing room.
It's interesting comparing coverage of the CTC versus college debt forgiveness in both the mainstream and progressive media. Clearly the CTC will help many more people in need, but coverage of it seems dwarfed by the program laser targeted to benefit young journalists from expensive universities. Another argument for more diversity in the media.
And where are the progressive activists out there arguing to make the CTC permanent?
Just correcting one part of the article - they are sending letters. We got ours last week. Here’s the IRS link announcing it: https://www.irs.gov/newsroom/irs-sending-letters-to-more-than-36-million-families-who-may-qualify-for-monthly-child-tax-credits-payments-start-july-15
I came here to say the same thing. We received an IRS letter last week explaining the payments.
My wife and I combined fall close to the higher edge of the married couple income range, and we are using the checks for our two kids to pay for the older one's braces, which is an expense we might have otherwise had to finance out, so we are pumped. I have no policy commentary except to say that as a married parent, children are expensive and logistically difficult, and I don't know how single parents (including my own dad back in the day) manage it.
Biden should A) hire a bus covered entirely with big, colorful "CTC" wrap, B) spend all summer long doing nothing but driving around Pennsylvania, Ohio, Michigan and Wisconsin, C) bring a bullhorn.
Replace "CTC" with "KFC" and "bus" with "plane" and we're back to Trump :-]
I can see that the CTC will help a lot of people, that it's really good policy, and that we should make it permanent.
However, I doubt its value for helping us win elections. Obamacare helped 20 million people get access to medicine, most of them poor white people. It is such good policy that it is unlikely to ever go away, yet it's basically a curse word to a majority of poor white people.
You’ve highlighted one of the weirdest issues in American politics: the ungrateful voter syndrome. By my reckoning, changes in social welfare policy are singularly unhelpful in building immediate electoral help. Other topics are always more salient to voters. Not sure why this is, but I’d guess that questions tied to race, religion, and the like are more important to most voters, especially in a mid-term poll.
The key point here is that legislators who think they will be lauded by voters are normally disappointed.
Yep, people who have read my comments here before will not be shocked to learn that I think it's mostly about race.
And I don't think "ungrateful" is the right term. Medium-racist people are very grateful to have political leaders who say what those medium-racist people really feel, just as I am grateful for politicians who explicitly make the antiracist argument.
I'm curious how you see similarities to other countries in the world? Do you think its race for them as well?
In Kenya, race isn't a lens, but "tribe" (I don't love the term) plays a major role in how people feel about policy and politicians. Some people want politicians who will pitch an anti-tribalism message, while others want politicians who will use dog whistles (or bull-horns) about the tribes that they dislike.
"the ungrateful voter syndrome" - I think this occurs for the same underlying reason that most progressives aren't super grateful that Bezos (per Propublica) paid almost a billion dollars in taxes over 4 years.
I think it's mostly cursed beginning at the lower middle class. Most of us are having the same experience with health insurance that we had before it appeared, only more so: every year we go to a meeting at work, with a representative from our employer's chosen insurance company (usually a different name than it had the year before). In this meeting, we learn that in the coming year we'll be paying more money for less coverage. Every year.
This feels like a small exaggeration, but only a small one. Lower income people who are full time employees (they are legion) are still having to make difficult decisions about which health care is worth pursuing, and that doesn't appear to be going away.
Yeah, I do wonder about it's political popularity here. I'm a Northern Irish immigrant, so universal child benefit seems to me like a kind of "well, duh, you should have that" type policy. However, I have quite a few co-workers who have a "you're just going to give people a check? . . . because they have a kid? . . . does not compute" reaction to the idea. It has given me some pause that the concept does not really fit with some deeply embedded American cultural values. They should still do it like Matt says though!
I feel like it was a big mistake not to make that bargain with Romney and do his plan instead. Almost as good at eliminating child poverty, gets some of that bipartisan cred that can be used in elections, and most importantly is just permanent. I feel like doing the CTC this was is going for "double or nothing."
Yeah, if the plan gets extended every year it's great, IF. We'll see if Democrats are able to keep getting this thing extended in like 2025 the next time there's a debt ceiling fight with a GOP senate majority and Ted Cruz holds the economy hostage again and demands to kill this or something.
Romney is one vote in the Senate. No other Senate Republicans came out in support of the plan, to my knowledge. And I can't think any House Republicans will back a tax credit associated with "Romney". So you'd need unified Democratic support on a plan that cuts certain anti-poverty credits (albeit, it makes up for those cuts with its tax credit) and pays for itself by further eliminating the SALT deduction (something that certain suburban swing-district Dems care a lot about)... seems unlikely.
I was curious about what happened to it, and I just found this piece. It says that both democrats and republicans found things not to like, which sounds like good policy to many of us but also has made it DOA when combined with Romney's outsider position already: https://www.theatlantic.com/politics/archive/2021/05/mitt-romney-child-tax-credit/618955/
Social security for kids would be a worthwhile and exciting legacy
In principle, I am all on board for making the expanded CTC permanent. We should be giving struggling families a hand. So sign me up! And yet . . . and yet . . . there are two things that niggle at me:
-- By the mid-1990s, there was a pretty wide consensus that AFDC was a failure and too often it supported a culture of dependency. The CTC isn't quite AFDC, but it bears a strong family resemblance. Have we decided that that view of 25 years ago was totally wrong and we should basically go back to the old system? If so, I must have missed that argument.
-- We need to spend more. Period. But any permanent program has to be paid for (unlike short-term bailouts, Keynesian stimulus programs, etc.) And I don't care if interest rates are low or even if we expect them to remain low. I may be able to manage a $300,000 mortgage at moderate mortgage rates, but if those rates are 0.0001%, that doesn't mean I can afford a $20 million mortgage -- the principal payments alone will kill me. So we have to generate revenue to pay for the CTC and the other things we want and need to do. But there's clearly a consensus in this country that 'ordinary' people (say, under $400,000 in household income) shouldn't see any tax increases. Elizabeth Warren notwithstanding, you simply can't run a Nordic-style welfare state only paid for with taxes on the wealthiest. (Not to mention that if you personally aren't willing to cough up the bucks for something, how much do you really value it?) So how will we get the middle and upper middle class to be on board for paying more for these undeniably good things we want to do?
Answer those two points and I'm a happy guy.
I don't know the exact details of AFDC, but everything I've read noted that it has a strong work disincentive. Basically it goes away if you start working, so many people decided not to work. Not providing a work disincentive is practically the number one rule of welfare programs, so AFDC was pretty seriously flawed.
The CTC doesn't provide a work disincentive. In fact, the old CTC provided a strong work incentive: you didn't get it if you didn't work. The new CTC has neither an incentive nor a disincentive. That may seem like a small thing, but it really sets it apart from the AFDC. This isn't going "back to the old system".
Yeah, the CTC is given regardless of work status and doesn't really benefit those that don't work. AFDC specifically phased out when the recipient started earning just about any appreciable income.
Regarding point one, isn’t the main difference to AFDC that recipients list their benefits if they got a job? That’s not the case here.
*lost
(just fixing an error that unfortunately Substack won't let you fix.)
Maybe our revealed preference is that we don't actually want those things? Most of us have figured out how to carve out a decent life in this country. I recognize it's not great for everyone, and I certainly want to sand off some of the rough edges. But I also don't, for example, want to completely overturn the healthcare system or higher education or (etc.) because so far, few to none of the proposals I've seen actually address the core problems, vs. just wasting money.
I hope you're wrong. I'd like to see us do far more to make this a more equitable society, even if not all policies are a total success. But I fear that your first question may reflect the views of the median voter. That it's not rural state bias in the Senate, Electoral College skews, or gerrymandering that preclude passing these ideas into law and more that most voters are hesitant to see truly bold public policy.
Even if democrats controlled everything, I don't think you would see M4A and free college (to use my two examples). My (possible) disagreement with your vision is that I don't see utopia as basically what we have now, just given to everyone. To continue an example, to fix higher education, I think we need to break the expectation that everyone needs a degree, that those degrees need to take four years, and that universities are the only place to get training. In this regard, I think Matt's full employment goal will actually do more to help than more free money.
Other countries that do have the things you want actually do implement some of the cost controls necessary to make them work, e.g., lower doctor pay, more tracking of students onto different paths, etc. (as I understand these things at least). I'd be more open if I saw the proponents here actually tackling these really difficult issues, but they don't because (1) they may not be interested anyway and (2) since it's politically impossible still, there's no point in bringing up the negative aspects.
I've lived the vast majority of my life in the EU, and after coming to the US I understand why tuition-free college isn't a good idea.
However, I would disagree with you on healthcare. Doctor pay in the EU is lower than in the EU, but all high-paying jobs pay less anyway. To the best of my knowledge, doctors are still the highest-paid employees or something close to that in the EU. On the other hand, you don't get that army of billing experts there, so I mainly view the US healthcare system as a make-work jobs program (but make-work is inefficient).
As a side note, I usually wait for my vacations back home to see doctors, as I trust them more than US doctors. Here, I just have the feeling that the doctor tries to steer me into useless stuff to increase the amount my insurance and I will have to pay.
Sure, I threw doctors under the bus because that's the one I remember, but I agree that there's a lot of really tough budgeting at the provider level in general that would need to happen to get to something like M4A, yet I don't think I've seen any proponents talk about. Even the ACA was a very complex, 1000-page bill and despite being a significantly less drastic change than M4A, it still had many unpredictable consequences.
Sure, I don't believe that M4A is necessarily a good idea. I think that healthcare should be treated like safety. A public tier available to everyone financed by taxes (police), and whoever wants something more can always go private (private security companies).
I have mostly used doctors outside of the public system back home, but I had good bargaining power because they knew I could just go to the public option and pay nothing, if they weren't clearly superior in terms of quality (and they didn't have a good quality to cost ratio).
So, direct provision of services (at the same government level that provides courts/police/firefighting) and optional unregulated private insurance is the optimal system I think. (I think that healthcare is one of the few things that we do better than the US back home.)
>>>I understand why tuition-free college isn't a good idea.<<<
Why isn't it a good idea from your European perspective? I'm genuinely curious. K-12 education in the United States is tuition-free. I don't see the harm in expanding this dynamic to include college. If anything, the statistics I'm aware of suggest the growth of education attainment in America has slowed pretty dramatically in recently years. That is, it's still growing, but very, very slowly, and the US has been overtaken by other high income countries in this area.
I have written a few comments on this in past posts, but I'm not sure how to search for them. If you know, let me know!
Meanwhile, one quick point that I want to make is that it's "easy" to provide tuition-free college in the US. Just make it illegal for public universities to charge tuition. "Tuition-free" doesn't necessarily mean that the university gets from the public as much money as it wants. I think that this action would lead American universities to get closer to European ones in global ranking. (My past comments are much more detailed than this, but I can't find them now.)
*“Doctor pay in the EU is lower than in the US”
All healthcare staff wages in the US is less than 10% of overall health care costs. You can be extremely aggressive at cutting doctor pay and you’re not going to get much overall bang for the buck.
I agree that we're unlikely to have M4A and free college but mostly because those things really aren't popular (or their popularity wouldn't survive any sustained debate). I'm more concerned about things that people are generally in favor of but don't think they personally have to pay for them.
The ghost of '84 Mondale looms large over our political landscape.
So what things do you want to spend money on? I agree that expanding the CTC (or equivalent) is a potentially good one (as you note, we should take care to not fall into the same traps as before). I was extremely encouraged by Romney's (paid for!) proposal and then quite disheartened to see it get zero traction.
I'm not sure my preferences matter, since I'm not the median voter and I'd be fine paying higher taxes for things on my particular wish list, but #1 is to spend vastly more to fight climate change (rewiring our grid, vast expansion of renewables, greatly increasing penetration of EVs into the national fleet, etc.) Build on and expand the structure of Obamacare. Create more of a financial floor for struggling working families. Lots of other things!
I went into the paid labor market when I was 18 and I just don't see how this is a good practice adulthood experience compared to sending people to 13-16th grade and increasing vocational and life skills classes. The labor market, just isn't concerned at all with humanistic development as it should be but most 18 year olds still need a lot of it.
Like the labor market is so much live ammunition. It wasn't intermediate comp that college was good for. It was really good adulthood practice, at least for a life as a professional.
In the not to distant past, I worked with a large number of new employees. 2/3rds were recent college grads while 1/3 were people without degrees but work experience. For most of what we needed, I would take a 22 year old with 4 years of work experience over someone who had been in college for 4 years.
We were going to have to teach them how to do almost everything anyway, might as well get someone whose perception had already been influenced by reality. The amount of recent college grads who were used to being able to skip work, get praise for mediocre work, and pushed back against the idea of doing entry level grunt work was incredible. There were a lot of good people who became excellent workers in there, but I was always shocked by the contrast.
I wasn’t really speaking about making better employees.
Like as an autistic person cooking was never going to teach me the kind of social skills I needed to cope with a post high school world. University made me a much more competent adult beyond just doing a job.
The argument in the 90's was you should only get stuff if you are working. The CTC requires that you work. There is no full time mom with no husband getting money from this.
As to how do you pay for it? it will pay for its self as these children growing up in poverty will no longer grow up in poverty and they will make more money and be taxed more. However that will create a 10-20 deficit.
Not trying to give you a hard time, but the similarities between CTC and AFDC are superficial and it would be wise not to equate them… It’s a bit alarming to see this asked in good faith because AFDC is a big part of the legacy of the “welfare causes dependency” trope, which is true of poorly designed welfare programs.
I can’t remember the episode, but on the Weeds, Matt has described AFDC in terms very much opposite to “very well designed” (or whatever he said about CTC).
As others pointed out, AFDC had a strong disincentive to work, and this was by design: it was originally meant for widowed white women, who weren’t expected to work.
AFDC required that you not work in order to qualify. It was designed to subsidize widows to allow them to maintain their way of life and raise the kids if Dad died. It just didn't age into the 1990s well.
These are great questions. Hope if answers. I think this is where I most diverge with Matt's progressive vision ... specifically the money-printer-go-brrrr approach to fiscal policy as if debt levels are disconnected from the economy and / or can be continually inflated away.
Where do we see the higher levels of debt in the US causing economic problems?
I think continuing Matt's post from yesterday and if you buy his arguments ... we can now say the last round of stimulus was too big, too compressed, and too short-sighted. Probably too soon to tell if we're facing any long-term risks. But I'm certainly not going to discount the possibility of coming systemic economic problems.
https://www.nytimes.com/2021/06/15/opinion/inflation-federal-reserve-powell-biden.html
https://www.bloomberg.com/news/articles/2021-05-28/lawrence-summers-says-biden-budget-risks-oveheating-economy
https://www.bloomberg.com/news/articles/2021-03-20/summers-says-u-s-facing-worst-macroeconomic-policy-in-40-years
It occurs to me once again that Mr. Biden is a remarkably skillful politician.
Great well written post. But, I already miss Marc the intern's charts. I would love to see how much of an outlier the USA is on poverty, especially compared to recently industrialized countries such in Asia and Latin America or Big African countries like Nigeria.
The letter the IRS sent out is the lamest thing ever. It's dry and doesn't even say if I'm eligible --- just that I'll get money if I am. Way to sell the product.
I thought Trump's letters were tacky and dumb, but it was a smart move. His giant signature grabbed your attention. If Trump hadn't done it already, I wouldn't want Biden to do the same, but that cat is out of the bag. Also, Biden's signature straight up looks nicer than Trump's sharpie monstrosity.
Helping poor kids >>>>> helping poor adults and retirees
"To recall, the expanded Child Tax Credit puts extra cash in the hands of virtually all American parents, leaving out only the richest."
This seems to be the newly favored way of doing "means testing"--give the money to basically everyone, except the explicitly wealthy. Doesn't this just make programs administratively burdensome while saving virtually no money? Is there any practical reason to exclude the rich?
Giving families money so that children are not stunted by poverty is a fine, empirically supported idea.
The broader natalist argument is hideous. It took 200,000 years for the one billion humans to exist simultaneously. A century and a half later, there are 7.4 billion. Global population is still increasing and won’t peak for decades. As an individual, I like uncrowded parks. As a consumer, I like abundant natural resources. As a pragmatic human, I know the best way to destroy the planet more slowly is for there to be fewer humans.
The U.S. population is still increasing. Highways are gridlocked. Cities are crowded. I pine for vast, open spaces, thinly peopled with tolerant men and women who have time to share wine, conversation and recreation unharried by large families. There are plenty of would be immigrants to change our diapers in old age.
Pro-Natalist policies in Western countries don’t aim to generate huge population increases, they merely are trying to keep the population somewhat closer to the replacement rate of 2.1 children per couple/woman. The best guess at this moment is that global population will max out at 10 billion, so Malthusian fears of overcrowding don’t comport with what is predicted by the demographic community.
I don’t think a Malthusian nightmare is likely, but there are other reasons to avoid population growth. It is a strain on natural resources. It makes open spaces more crowded. There are only a limited number of places of exquisite beauty. The more people who have to share them, the more crowded they will be.
Why does it have to be either instead of both?
Climate change will lead to lots of bad things. Its not the only thing that can lead to bad things. The developed world relying on Africa and Southern Asia to provide people for the future when they are much more impoverished than we are doesn't seem like a good plan.
Not a lot of choice here
I think Matt said in his book that even if we got to the number 1,000,000,000 Americans we'd still only have roughly the population density of France. There is a LOT of open space in the U.S. to both welcome more immigrants and have policies that encourage people to have and support families.
I think one issue with this is there aren’t the policies in place that effectively channel immigrants to the communities that are shrinking where they are needed the most. Instead, people (Americans and High-Skilled immigrants) flock to the superstar cities where there are real issues of housing and it’s unclear if zoning issues will ever really be overcome.
There needs to be federal incentive programs to just make these super cities everywhere coast to coast. Maybe even specify this, I don’t know if this is ethical, but it’s just a thought, specify location of high skilled work visas? Allocate like “These additional 5,000 work visas can only be used in South Dakota.” Or something.
It seems less unethical than the current policy, which says "this work visa can only be used to work at XYZ Corp, and if you want to change jobs, you either have to get federal approval or leave the country".
It seems like states should be allowed to sponsor immigrants, in numbers above the national quotas. The immigrants could be required to maintain residency in the sponsoring State for the five years or whatever it takes to become citizens. Then they'd have a constitutional right to move around, but a lot would stay put.
The fastest growing metro areas in the US include superstar cities like Orlando, Raleigh and Sarasota. NYC, LA, DC and Boston are nowhere near the top. Seattle and maybe now Austin are the only "superstar" cities that make the top 20.
Well yeah, both native born Americans and immigrants are price sensitive. My larger point isn’t that people will never want to move to Orlando, it’s that despite all the land in America enough people aren’t moving to rural areas like West Virginia or old industrial towns like Detroit that are losing or have lost population.
It is probably not a good idea to send immigrants to areas that have declining job opportunities. People are moving away from those places for a reason. Of course, many immigrants do work in rural areas as agricultural workers, but sending people to a location based on low population density seems like a worse choice then current policy which sends them where they can get a job.
Populations are declining in rural communities because rural economies have always been based around resource extraction, something that is not as cost effective in the era of environmental protection and global competition. Putting more people there who have little economic capital is not a great idea.
First, have you ever gone hiking in the Alps? Don’t bother, it’s too crowded. Second, almost all of France has a pleasant or ar least passable climate. If you think western Nebraska should have the same population density as Brittany, I think you should have your head examined.
Hate to break it to you, but by the time global warming is done, western Nebraska may be the only livable place on the planet.
Whatever America does or doesn't do with respect to natural population growth will barely be a rounding error as the decades roll on. We're just not a very large portion of humanity. Way under 5% and shrinking. If somehow we managed to juice natural population growth via pro-family benefits (I doubt it, how many babies are Finns having?), it would mean our share (absent immigration) of world population would fall a bit more slowly than it otherwise will, is all. If we're going to get anywhere near Matt's vision of 1 billion Americans (and that's pretty damn doubtful, too, although I'd like to think we can reverse our current demographic stagnation) it'll be via increases in immigration.
True enough, but this isn’t a defense of natalia, it’s an admission that child allowances do more to help children than to spur their creation.
Not exactly sure what you mean by this. Whose "admission" are you referring to (yours or mine)? What I'm saying is, even if you think a substantial increase in US childbirths were a bad thing, you've got nothing to fear from policies that give money to families with children, as the evidence from other rich countries shows they do little (and in many cases apparently nothing) to increase the birthrate. But on the other hand, such policies reduce child poverty, which alone is a hugely important task (I can think of few goals more worthy) and likely expand the country's long term outlook in terms of economic growth and prosperity (child poverty tends not to be conducive to productivity).
We agree. Child allowances reduce child poverty without greatly increasing fertility. Therefore, I can reject natalism while supporting child allowances.
*natalism
What you want is incompatible. "Tolerant men and women who have time to share wine" are to be found in cities, not thinly peopled open spaces. City air makes free.
My experience has been different. I live in an outer Atlanta burb. The public schools are good and I have a nice house that is worth $400k. If I lived in Atlanta, (I moved when my child turned school age) I’d have to pay $600k for a smaller house without a pool. The absence of a pool would cost me thousands in travel to escape the heat ever summer. Unless I paid a stiff real estate premium for the Decatur schools, I’d be out $30k in tuition. Those additional expenses would mean more work and less leisure. In Peachtree City, I can live comfortably working 25 hours a week.
Atlanta metro is a large city, not a thinly-peopled open space. It is also one of the most segregated places I've ever seen in America, unless it has changed radically in the past 10 years (I have family connections there, so this is not hearsay). There are some tolerant people there, but I think that extolling the place as a mecca for such is a bit of a stretch.
Slow down there Thanos. Honestly underpopulation is a much much bigger problem for developed countries than overpopulation. Just look at Japan.
Your painting of a diverse Rivendell would be… pretty dope. I also don’t think you have to worry much. In most countries where similar plans have been in place. Even when they are specifically transparent about the point of the plan being to make their nation more fecund, things like this have little long term impact on increasing birth rates.
Well… I guess I should clarify. Your diverse Rivendell won’t be impeded by this plan. Our culture however might take some incentivizing before it gives up its love for fried food, football games, binge tv, and 70 hour work weeks and wants to consider more seriously, as my favorite literary hero would say, having a better sense of “theology and geometry.” Myself included.
US population as a whole is increasing but many Rust Belt cities are shrinking. If you want an uncrowded city, move to St. Louis?
As a citizen I like a welfare state that isn’t collapsing.
Immigration and taxing inheritances can avoid that. The older the population, the more the estate tax can raise.
Rapid increase in immigration causes nationalist backlash and taxing inheritance causes conservative backlash which is just as 'hideous' / counterproductive to our goals (granted conservative backlash over estate taxes is less severe than immigration). I'm in favor of more immigration and at the same time in favor of natalist policies in a country where people desire more children than they currently have and density is relatively low. I think almost all of the issues you mentioned are challenging but solvable. I'm on this blog partially b/c of the One Billion Americans book though.
I get the concerns about resource strain, but I also wonder what will happen in South Korea where at some point in the near future about half the population will be over 65.
Have you seen any of the discussion about the disproportionate balance in the Senate for rural states and how the government should represent people not geography? Republican's represent far more "land area" than Democrats, but Democrats represent more people. Sounds like you should move to a red state.
He did it! “slow boring of hard boards.” I’ve been waiting to see that show up.