A Top Priority to Address Poverty: Strengthening the Child Tax Credit for Very Poor Young Children
End Notes
[1] Chuck Marr et al., “EITC and Child Tax Credit Promote Work, Reduce Poverty, and Support Children’s Development, Research Finds,” Center on Budget and Policy Priorities, updated October 1, 2015, https://www.cbpp.org/research/federal-tax/eitc-and-child-tax-credit-promote-work-reduce-poverty-and-support-childrens.
[2] Center on the Developing Child at Harvard University, “From Best Practices to Breakthrough Impacts: A Science-Based Approach to Building a More Promising Future for Young Children and Families,” May 2016, http://developingchild.harvard.edu/resources/from-best-practices-to-breakthrough-impacts/.
[3] Rep. DeLauro has also introduced a bill (H.R. 1286) that would eliminate the current $3,000 earnings threshold for the regular CTC, increase the CTC phase-in rate to 25 percent (from its current 15 percent), and index the regular $1,000 maximum CTC amount to inflation.
[4] The Bennet bill (S.2264) would raise the maximum CTC for children under 6 to $3,000 and begin phasing in both this $3,000 credit for young children and the credit for children 6 and older (which would remain at $1,000) with the first dollar of earnings. The bill would phase in the $3,000 young-child credit at a 45 percent rate. The phase-in rate would remain at 15 percent for children 6 and over. The bill also would index the maximum credit amounts.
[5] The Baldwin-Booker bill (S.3231) doesn’t specifically target young children. It would eliminate the $3,000 earnings threshold and index the $1,000 maximum credit amount.
[6] Greg J. Duncan, Pamela A. Morris, and Chris Rodrigues, “Does Money Really Matter? Estimating Impacts of Family Income on Young Children’s Achievement With Data From Random-Assignment Experiments,” Developmental Psychology 47, No. 5 (September 2011): 1263–79, http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3208322/.
[7] Greg J. Duncan and Katherine Magnuson, “The Long Reach of Early Childhood Poverty,” Pathways, Winter 2011, pp. 22-27, http://www.stanford.edu/group/scspi/_media/pdf/pathways/winter_2011/PathwaysWinter11_Duncan.pdf.
[8] Hilary W. Hoynes, Douglas L. Miller, and David Simon, “The EITC: Linking Income to Real Health Outcomes,” Policy Brief Vol. 1, No. 2, Center for Poverty Research, http://poverty.ucdavis.edu/policy-brief/linking-eitc-income-real-health-outcomes.
[9] Hilary Hoynes, Diane W. Schanzenbach, and Douglas Almond, “Long-Run Impacts of Childhood Access to the Safety Net,” American Economic Review 106, No. 4 (April 2016): 903–34, https://www.aeaweb.org/articles?id=10.1257/aer.20130375.
[10] Greg J. Duncan, Kathleen M. Ziol-Guest, and Ariel Kalil, “Early-Childhood Poverty and Adult Attainment, Behavior, and Health,” Child Development 81, No. 1 (February 2010): 306–25, http://www.ncbi.nlm.nih.gov/pubmed/20331669; 17 percent figure is a revised figure and appears in Duncan and Magnuson (2011), “The Long Reach of Early Childhood Poverty.”
[11] Anna Aizer et al., “The Long-Run Impact of Cash Transfers to Poor Families,” American Economic Review 106, No. 4 (April 2016): 935–71, https://www.aeaweb.org/articles?id=10.1257/aer.20140529.
[12] Kerris Cooper and Kitty Stewart, “Does Money Affect Children’s Outcomes? A Systematic Review,” Joseph Rowntree Foundation, October 22, 2013, https://www.jrf.org.uk/report/does-money-affect-children%E2%80%99s-outcomes.
[13] Gordon B. Dahl and Lance Lochner, “The Impact of Family Income on Child Achievement: Evidence from the Earned Income Tax Credit,” American Economic Review 102, No. 5 (May 2012): 1927–56. The lowest quartile consisted of families earning less than $18,031; the middle two quartiles consisted of families earning between $18,031 and $41,790, while the fourth quartile including families earning more than $41,790.
[14] Jeanne Brooks-Gunn and Greg J. Duncan, “The Effects of Poverty on Children,” The Future of Children, Vol. 7, No. 2, Summer/Fall 1997.
[15] In one study of 14 welfare-to-work programs, for example, programs that lifted family income had positive effects on children’s academic achievement throughout the first six years of life (effects were virtually the same for ages 0-2 and ages 3-5) but little effect after age 6. See Elizabeth Clark-Kauffman, Greg J. Duncan, and Pamela Morris, “How Welfare Policies Affect Child and Adolescent Achievement,” The American Economic Review 93, No. 2 (2003): 299–303.
In another study, which used two separate large national surveys to follow children over time, the timing of income within the first six years of life made little difference in children’s results on intelligence tests, for example; in fact, “the effect of income at age two was quite similar to that found at ages three and five.” See Judith R. Smith, Jeanne Brooks-Gunn, and Pamela K. Klebanov, “Consequences of Living in Poverty for Young Children’s Cognitive and Verbal Ability and Early School Achievement,” in Greg J. Duncan and Jeanne Brooks-Gunn, eds., Consequences of Growing Up Poor, p. 165.
[16] Gordon Berlin, “Investing in Parents to Invest in Children,” Testimony at the National Summit on America’s Children, May 2007, http://www.mdrc.org/publication/investing-parents-invest-children.
[17] National Center for Children in Poverty, “Early Care and Learning,” http://www.nccp.org/topics/earlycareandlearning.html.
[18] Duncan and Magnuson, 2011.
[19] Ibid. Also see Center on the Developing Child at Harvard University, “Excessive Stress Disrupts the Architecture of the Developing Brain,” January 2011, and S. J. Lupie et al., “Can Poverty Get under Your Skin? Basal Cortisol Levels and Cognitive Function in Children from Low and High Socioeconomic Status,” Development and Psychopathology 13, No. 3 (2001): 653–76.
[20] Gary W. Evans, Jeanne Brooks-Gunn, and Pamela Kato Kelbanov, “The Environment of Childhood Poverty,” Pathways, Winter 2011, pp. 18-21, http://inequality.stanford.edu/_media/pdf/pathways/winter_2011/PathwaysWinter11_Evans.pdf.
[21] Nicole L. Hair et al., “Association of Child Poverty, Brain Development, and Academic Achievement,” JAMA Pediatrics 169, No. 9 (September 2015): 822–29, http://archpedi.jamanetwork.com/article.aspx?articleid=2381542.
[22] Numerous studies find income effects during early childhood, but “evidence is mixed about which stage of childhood is most important. To some extent, income at particular stages seems to be more important for some types of outcome than others,” according to the London School of Economics researchers’ review. Behavior problems, for example, are tied more to later childhood poverty than early childhood poverty in a number of studies. Even for cognitive outcomes — where the linkage to early childhood is quite strong — “there are studies pointing to each stage of childhood as the more important.” (Cooper and Stewart, 2013.)
[23] See Ziol-Guest et al., “Early Childhood Poverty, Immune-Mediated Disease Processes, and Adult Productivity,” Proceedings of the National Academy of Sciences 109, No. Supplement 2 (October 16, 2012): 17289–93. “[T]hese relationships and particularly arthritis partially account for the associations between early childhood poverty and adult productivity as measured by adult work hours and earnings,” the study finds.
[24] Dayanand S. Manoli and Nicholas Turner, “Cash-on-Hand & College Enrollment: Evidence from Population Tax Data and Policy Nonlinearities,” NBER Working Paper, January 2014, http://www.nber.org/papers/w19836.
[25] Greg J. Duncan et al., “The Importance of Early Childhood Poverty,” Social Indicators Research 108, No. 1 (May 25, 2011): 87–98, http://link.springer.com/article/10.1007/s11205-011-9867-9.