Everything you need to know about what the expanded child tax credit actually is, why it’s good policy, and how it will impact people’s lives.
Wendy Bach is a Professor of Law at the University of Tennessee, Knoxville. She is a nationally recognized expert in poverty law.
Twitter: @wendyabach
Biden’s child tax credit is a step away from a discriminatory system: https://qz.com/2034199/how-does-the-us-child-tax-credit-work/
Two-thirds of people now receive monthly benefit checks: https://www.peoplespolicyproject.org/2021/07/19/two-thirds-of-people-now-receive-monthly-benefit-checks/
The time tax: https://www.theatlantic.com/politics/archive/2021/07/how-government-learned-waste-your-time-tax/619568/
Website: https://pitchforkeconomics.com/
Twitter: @PitchforkEcon
Instagram: @pitchforkeconomics
Nick’s twitter: @NickHanauer
Nick Hanauer:
What makes the child tax credit so special?
Wendy Bach:
I would call the expanded child tax credit really revolutionary in American social welfare policy. And the reason simply is universality.
David Goldstein:
It was part of the $1.9 trillion COVID relief package. It’s a lot of money in working people’s pockets.
Nick Hanauer:
And I think we all need to work hard to ensure that it continues, that it becomes a permanent benefit for families.
Speaker 4:
From the home offices of Civic Ventures in downtown Seattle, this is Pitchfork Economics with Nick Hanauer, the best place to get the truth about who gets what and why.
Nick Hanauer:
I’m Nick Hanauer, founder of Civic Ventures.
David Goldstein:
I’m David Goldstein, senior fellow at Civic Ventures. Big news recently, Nick, In July, the first checks went out to families with children from the expanded federal child tax credit, it’s a lot of money in working people’s pockets. It was part of the $1.9 trillion COVID relief package that President Biden signed in March. And it has extended and expanded these credits for another year, they had been part of the original COVID relief. I said it’s a lot of money. Before the expansions, families are provided with up to $2,000 per child under 17. Now it’s $3,600 for each child under six and $3,000 for each child under 18. And it looks like it’s making a difference already.
Nick Hanauer:
Yeah, absolutely. I mean, and the estimates predict the payments could cut child poverty by nearly 50%, which is amazing and-
David Goldstein:
And that’s a lot of children.
Nick Hanauer:
It is a lot of children. In the US today, one in seven children live below the official poverty line. So as you say, it’s a lot of children. And two thirds of people now receive monthly benefit checks, which is quite extraordinary. I mean, I think the thing that’s really great about the child tax credit, otherwise known as the CTC, is that it is true centrism in the sense that it’s a universal benefit aimed at the majority of citizens. And it’s a general welfare benefit rather than a poor person’s benefit, which makes it more universal and ideally more supported.
David Goldstein:
I’ve always found it odd how that word welfare, which is a good thing, we want to improve welfare, was turned into a bad word. President Clinton famously said, “With these reforms, we’ve ended welfare as you know it,” which effectively meant that we went from 68% of families with children who were living in poverty receiving some federal benefits, down to only 28%. And now we’re almost back to where we were before Clinton ended welfare as we know it in the mid ’90s and replaced it with that incredibly stingy, punitive and difficult to apply for system.
Nick Hanauer:
Yeah, this is a really significant step for the federal government, it’s clearly going to really significantly impact the lives of tens of millions of people and may reshape how we think about the role that government can play in providing people a decent life. And as such, I think it’s really worth understanding at a deeper level and exploring, and to do that, we have an amazing expert with us. Wendy Bach is a professor of law at the University of Tennessee at Knoxville and she’s a nationally recognized expert in poverty law, and has dedicated her life to representing children and families in poor communities. And she’s going to talk us through precisely what this new benefit does and why it’s a good thing and why we should hope to make it last for a very long time.
Wendy Bach:
Hi, my name is Wendy Bach. I’m a professor of law at the University of Tennessee. I have the great privilege of teaching primarily in our clinical program, which means that I represent clients along with my students every day and also teach them other stuff. I specialize in social welfare policy and poverty policy and what we call the criminalization of poverty. And next summer, I have a book coming out from Cambridge University Press called Prosecuting Poverty, Criminalizing Care.
Nick Hanauer:
So Wendy, big picture, what makes the child tax credit so special? And what makes it a notably new approach to supporting families?
Wendy Bach:
I would call the expanded child tax credit really revolutionary in American social welfare policy, and the reason simply is universality. This is a cash benefit delivered in the same amount, in the same way to families along nearly the entire US income spectrum, from families with no income at all, to married couples earning over $150,000. Although policies like this are quite, quite common in other Western democracies, the US has very, very few universal benefits. Instead, as a practical matter, the United States is strange and unique in that it really has three benefit systems that break down almost precisely by income level. So we have what I like to call welfare for the wealthy, benefits at the top, delivered mostly through tax expenditures, through the tax code.
We have benefits across the board just for the elderly, Social Security and Medicare. And then we have benefits at the bottom that are means tested. And I think we’re going to talk a bunch about those and the differences in those, but the child tax credit is joining Social Security and Medicare as a universal benefit, and that’s really extraordinary for American social welfare policy.
Nick Hanauer:
It’s super cool. So you describe the universal benefits that we have for old people, but can you describe some of the welfare for the wealthy? What are some great examples of that?
Wendy Bach:
So we spent in 2019, $1.3 trillion on something we call tax expenditures, and these are benefits through the tax code for social welfare purposes, the ones that we’re most familiar with, and the ones that are super expensive, are the home mortgage interest deduction, that’s an extremely valuable deduction that goes predominantly to the very top of our income distribution and the-
Nick Hanauer:
It’s about 100 billion a year, isn’t it?
Wendy Bach:
Right. I think it is, yes. And then the exclusion for employer paid health insurance is another enormously valuable benefit that goes disproportionately to the wealthy. So that’s welfare for the wealthy. And the funny thing about those benefits, and the CTC is a little different than this, but most of those benefits are really invisible, so invisible that a lot of folks don’t even know they’re getting welfare when they get them. If you ask them if they get government benefits, they will say no despite the fact that they’re getting dollars in hand from the government through these tax expenditures.
The CTC is a little different because it’s a little more visible, it’s going into bank accounts, it’s coming with a letter from the president explaining what it is. So people are experiencing perhaps the CTC a little differently because it’s like the pandemic benefits visible to folks who are receiving it. And from my perspective, that’s a good thing.
David Goldstein:
And people didn’t have to apply for it. If they were already filing their taxes, this is coming automatically.
Wendy Bach:
In the vast majority of circumstances, that’s right. So if you filed in 19 or 20, and you have a child who would now be a dependent child, or if you filed for pandemic-related emergency benefits, you’re going to get it either direct deposit in your bank account or check in the mail. There are about four million families that qualify for the expanded CTC but don’t fall into that category, and we’re having to do a little work to get those guys into the program. But other than those four million people, and that’s a significant number, but other than those four million people, everyone’s getting it pretty automatically at this point.
Nick Hanauer:
Do you recall how much this benefit is costing annually?
Wendy Bach:
So all told, it’s about $110 billion being pumped into local economies through this benefit.
Nick Hanauer:
That’s great. So how will it impact people’s lives?
Wendy Bach:
I like to think about benefits like this in two ways, right? There are benefits to the family today and the kids today, and then there’s the long-term benefits to kids if they get economic support during their childhood. And we know different things about both of those things. And the news is really good on both those fronts for benefits like that. For the short-term, what’s it going to do today? The study I like to look at is one that just came out recently about the Stockton economic empowerment demonstration project. This was a $500 a month payment to 125 residents of Stockton, California, who lived in a neighborhood with a median income at about $46,000 a year.
And it was an experiment, right? There’s a treatment group and a control group with similar characteristics. And the 500 is a good number to look at, because that’s what a single parent household with two kids over five are going to get under this CTC. So they had some really, really interesting findings after this started about a year out. The first, and this is a finding I don’t think we need, I think we should assume that poor people, like most other people, are going to make good choices with their money, and we know they do, but lots of people think they don’t. So just in case we need to know this, folks in this Stockton experiment spent their money on basic needs, the largest spending was on food, utilities, auto care and transportation, less than 1% was spent on tobacco and alcohol. So folks are making good economic choices.
Again, I don’t really understand why we think they wouldn’t, but there you go. But in terms of how cash in hand affected them, there were really, really interesting positive findings. It affected their time, and that’s really important, right? So poverty creates stress, creates time crunches, right? You’re constantly looking for short-term employment, unstable employment. So that little bit of financial input alleviated stress and created time, time to spend time with children, time to invest in themselves, do training program. There was a decrease in what the researchers called forced vulnerability, right? Having to depend on other networks for basic needs, there was less income volatility, they were better positioned over time to handle a $400 emergency expense [inaudible 00:11:56] cash on hand, as opposed to by borrowing the money or taking away from some other bill.
There were lower incidence of anxiety and depression, statistically significant improvements in mental health. And I think the kicker, full-time employment moved from 28% at the start of the experiment to 40% full-time employment a year later. These are all good short-term outcomes that we can expect to see. Long-term, how are the kids going to do? The news is also very good. We know that cash and near cash benefits into a family during childhood materially improves the children’s outcomes as adults, higher education, higher earnings, increased life expectancy, better mental health, improved intergenerational mobility. So cash in hand to families is just going to do a lot of good.
Nick Hanauer:
So you study the differences between systems of support and care versus systems of punishment. So can you talk about our general approach to child and family poverty, how that aid can be viewed in that framework? And where the child tax credit falls on that spectrum.
Wendy Bach:
Sure. So just a little definition before I launch into this, so when I think about systems of care, it’s really broad, right? Cash and near cash benefits of the kind we’ve been talking about, and other forms of support, medical and mental health care, social work, the like. Systems of punishment, right? When I think about it, I’m talking about child welfare and criminal system actors, police, prosecutors, probation, jail, prison, things like that. So the reality in most mean tested benefits and in poor communities overall, is that those two systems, right? The systems that we set up, allegedly to help families and the systems that can take away your kids and throw you in jail, are deeply, deeply intertwined. And often, asking for help exposes you to child welfare intervention and possible loss of your kids or intervention in how you’re living your family life, and possible police involvement and additional criminal involvement.
I think this is very, very hard to imagine if you don’t practice in those communities, you’re not working in those communities, you haven’t lived in those communities. And I think the best way to understand the differences between these two systems is to think about how it happens at the top and how it happens at the bottom. So let’s take housing. Okay, welfare for the wealthy, we already talked about this. The home mortgage interest deduction is a substantial benefit for wealthy families to support their housing needs. On the bottom, we put some money into supporting housing, predominantly through public housing in the Section 8 program.
When you apply for something like Section 8 or public housing, you’re going to have an in person interview, you’re going to have potentially work or volunteer requirements, you might be drug tested, you’re going to sign a consent form allowing them to see all kinds of records about you and your family, you could lose that housing for failing to comply with a vast number of both behavioral requirements and documentation requirements, you’re constantly being asked to recertify, to reproduce paperwork, and focusing really on the presence of government officials in your home through home inspections, anything they see, right? That makes them worry about the safety of your children, and it could be no food in your refrigerator, right? Because you don’t have enough money so you’re applying for assistance to get food in your refrigerator but you’re going to end up with a child welfare referral.
So now think about that and then think about receiving the home mortgage interest deduction. And imagine that before you get your home mortgage interest deduction, somebody is like, “Well, sorry, Goldie, you really just have to pee in this cup first. And you know what, sorry, it might have been a mistake, but it screen positive for this drug. So to get your home mortgage interest deduction, you’re going to have to go into this drug treatment program. And if you don’t, we’re going to take away your benefit.” Right? So that’s how different it is. And that’s the experience of most means test is benefits and poverty systems in poor communities, is that there’s this constant humiliation and scrutiny and threat. The CTC is not like that, it’s much more, as we talked about, more like the tax expenditures or social security, right? Separate from that, which is one of the things that makes it so good. But I don’t think people can really imagine how different these things are unless you’ve been close to them in some way.
David Goldstein:
And let’s be clear, that example you use, let’s say, for housing vouchers, Section 8 vouchers, it’s not just Section 8, you’ve got to go through the same hoops when you’re applying for Medicaid, but it’s a different agency, the same hoops if you are applying for SNAP, for food stamps, but it’s a separate agency. So you might not have food in the fridge because you got some snag in the paperwork on the food stamps. And then when they inspect your house, because you’re getting the housing vouchers, they see there’s no food and that’s when they call Child Protective Services and put your kids in foster care because you couldn’t get the paperwork right. Whereas, I can tell you from experience that getting that home mortgage interest deduction was… well, there’s this number that my bank sent me, and I plug that into one line on my tax return.
Wendy Bach:
Right. That is exactly how different it is. And everything that you just talk about is worse if you’re a person of color, if you’re African American than if you are white, right? So all these referral rates are going to be worse if you’re black or brown in America than if you’re white, right? Even if you’re white and poor, although the experience of being white and poor is quite awful as well. And I think talking about race for a moment, a story about this that is even more extreme but happened in California, it was in around 2007, as prices in white suburbs started to drop for housing, African American families with Section 8 vouchers, which are housing vouchers that are mobile, you can go and use the subsidy to rent an apartment as opposed to public housing where you’re living where the subsidy is.
African American families started to rent houses in white communities outside of Los Angeles and the police departments formed Section 8 task forces that included both at times police, juvenile justice and child welfare officials to police black Section 8 families, trying to get their benefits taken away. But they were going in and inspecting those households with police forces. So the amount of criminalization and policing of the experience of poverty that’s connected to benefit receipt is intimately tied to our history of racial subordination in our ongoing practices of racial subordination.
David Goldstein:
So in this case, our public support and care systems and penal systems and criminal justice systems are very much alike in that they are applied unevenly based on race.
Wendy Bach:
Yes, absolutely.
Nick Hanauer:
That is shocking, just terrible.
Wendy Bach:
Is it? Is it, Nick? Is it shocking? I mean, it’s terrible, but does it actually surprise you?
Nick Hanauer:
No, no, of course not, that was just like [inaudible 00:20:32] about this stuff, here’s like, “Boy, oh boy.”
David Goldstein:
Well, this gets to something, and it’s a little bit of a sore point on our podcast, because we’re not necessarily… I’m going to bring up the UBI, those three letters, Nick. We’re skeptics, we’ve been UBI skeptics, though I have to say that the pandemic relief over the past year and a half and this expanded child tax credit is making me less skeptical. Is the child tax credit like a first step towards a universal basic income?
Wendy Bach:
I fear to talk about the UBI with the two of you, frankly. So let me say, for me, when it comes to the UBI, the devil’s in the details, as frankly does the devil is in the details as to child allowances, right? Because when you say to me, “We’re going to build cash support on top of our pre-existing safety net. We’re going to give folks cash, and hopefully, our safety net won’t have as much work to do because we’re going to raise the income and prospects of families through some sort of a universal benefit.” Then I’m okay with that, right? In fact, I can be enthusiast. But when we start saying, “Oh, we’ll just take all the money that we spend on food stamps and Medicaid, and homeless assistance and mental health, and God only knows what, and we’ll all drop it into UBI and cross our fingers,” then I’m very worried.
I think we always need a safety net. I think that there will always be folks who are in crisis in some way. And for us to abandon that safety net is a mistake, right? In the sort of absent politics, I think that’s a mistake. And I also think UBI, it’s a harder sell than a child benefit because it’s not about kids, right? Then we’re talking about single adults. But I do think we’re in a very interesting moment post-pandemic benefits. I think as the ACA benefits, the Affordable Care Act benefits became clear, and as people started to think about what it might mean to lose those deeply convoluted, but still quasi universal benefits. And as people experience the government doing something good through the pandemic, right? The cash actually helped, and it was visibly from the government that it came. And the CTC, we might be entering a world where people can imagine that government can be good and can support. That’s good news.
Nick Hanauer:
Just to refresh your memory, there’s a couple of reasons why we’re not big UBI fans. The first is that there’s a lot of evidence to suggest that things like the EITC are mostly subsidies, not for the people who get them, but for the companies who employ them at low wages. That these benefits provide effectively an excuse for companies to pay people less than they need to get by without benefits. And there is no earthly reason why every company in America can’t pay people enough to not need public benefits, they just prefer not to. And we have built both a culture and policy framework that supports that exploitive behavior, and you could just make it all go away with the stroke of a pen, you could just raise the minimum wage to a level that required companies to pay people enough to get by without food stamps, and then that their need for those things would go away and there’d be a bunch of sad people on Wall Street, but we would get by that.
That’s the thing about the economy is it could pay people enough, it just chooses not to and so these programs effectively, they’re just an excuse not to do the right thing. But at the same time, I think child tax credit is a really great idea. And I think we’re in violent agreement with you that it’s a positive and that the universality of it is its best feature, right? That effectively everybody gets it or most people get it, and it benefits people a lot. And if that’s the way we get to an economy that doesn’t take such huge advantage of poor people and vulnerable people, well, then we’re all for it.
Wendy Bach:
I mean, that’s the complication, right? So that example we were talking about, right? It is utterly fathomable in America to do horrible things in our government programs to poor people, and it is utterly unfathomable in the American context to do the same thing to rich people. So in what Derek Bell calls interest convergence, you kind of have to give the benefits to people up the income scale in order to politically justify it being administered in a way that is as kind and generous as the CTC is for all but those four million or so families.
Nick Hanauer:
Yeah, I do love the idea of drug testing every single person who gets the mortgage interest deduction.
Wendy Bach:
You and me both. I’ve got no traction on this idea though.
Nick Hanauer:
I think that is a fantastic idea, and have somebody come to your house and look around and make sure you’re not doing anything bad, that’s just-
Wendy Bach:
And by the way, they’re going to arrest you if your kids skipped school as a condition of the benefit too, just for fun.
Nick Hanauer:
All that. Yeah. Do you think we have a shot at making it permanent?
Wendy Bach:
So I’m not a political academic, right? I don’t study politics in that way. So now you’re getting Wendy’s lay opinion as to that question. But I do think pandemic-related benefits have changed the conversation. I think people have experienced government giving them money that helps them to live a little bit better. And I also think that, much to the chagrin of Republicans, something like the Affordable Care Act has done that work as well. The Affordable Care Act was and remains incredibly bureaucratically complicated, so it’s less clear. But nevertheless, lots of people benefit from it. And when folks started to make noise about taking it away, all of a sudden, that wasn’t really popular.
So I think we are making progress on this idea that base level benefits can make a difference in people’s lives. And I think it’ll be popular. And I think they’re super smart to be doing it in such a visible way, right? The letter from Joe Biden, right? People now know they’re going to get it, and people don’t like it when you take things away, it’s like Social Security. So I’ve got my fingers crossed, and I have some tea leaves that are making me happy is what I would say.
Nick Hanauer:
If it was you, what policies would you pair with the child tax credit in the future to create a more comprehensive approach to Child and Family Welfare?
Wendy Bach:
I think we need a safety net. There are very few programs I would do away with. I think we need a series of universal benefits, that the child tax credit is a form of child allowance, that’s fantastic. I think we need subsidized high quality childcare. I think we need universal pre-K, we need universal health care. In saying all of this, I’m leaving aside all the sort of labor market side interventions, I’ll leave that to you guys to have it a wish list of. I’m really intrigued by programs like baby bonds, because I think they take a chunk out of wealth inequality in an interesting way. But what I want to say is that I don’t care just about programs of support and how much they’re worth, although I care a heck of a lot about that, but I really care about how we administer it, right?
I really care that we do it in a way that’s autonomy enhancing, that’s respectful, that’s easy, that promotes the ability of individuals to manage their own priorities and decide what they need to spend their money on. And more structurally, I think we need to vastly grow systems of support, shrink systems of punishment, and crucially, crucially, crucially, separate systems of support or care from systems of punishment. Poor people are not stupid, they know that accessing support makes them vulnerable to punishment, because it does. So we need to restructure those systems so that one isn’t linked to the other. So you don’t have to make a choice between getting basic support that you need and facing the possibility of child welfare intervention or prosecution. So I want all those benefits, and I want us to really grow care and separate care from punishment.
David Goldstein:
Annie Lowery had an excellent piece of the Atlantic in which she described our current benefits system, the effort to navigate it as a time tax. But I think what you add to that conversation too a lot of people don’t think about is just how punitive the current benefit system is the way it’s administered right now. It’s inhumane in a sense that the programs that are supposed to be humane end up dehumanizing people in a way that just even if it was efficient, it’s just not the way to do this. That’s from a moral perspective.
Wendy Bach:
Goldie, I wanted to go back to the Annie Lowery point, because I totally agree with you about what we’ve been talking about and what I study adds, but I think my scholarship adds one more thing, because when I talk about criminalization of these systems, right? It’s not only that the experience is punitive and horrible, it’s the exposure to punishment, right? So another thing, and this is when were talking about my book, right? One of the topic of the book or the case study in the book is about pregnant women who were prosecuted for fetal assault. So those women-
Nick Hanauer:
What? What’s fetal assault?
Wendy Bach:
In utero drug exposure.
Nick Hanauer:
Oh, okay.
Wendy Bach:
So they were prosecuted for fetal assault. So these folks go to a healthcare provider, to a hospital, and lo and behold, the statements they made to nurses, to doctors in the hospital end up in the criminal complaint against them. So I am going seeking health care, right? And the very information I disclose to this purportedly trusted health care provider is being used to prosecute me and to take away my children. So there’s a time tax, there’s a humiliation, there’s sort of punishment systems in the sense of it’s a horrible, stigmatizing miserable experience, but it’s also actually dangerous. I’m just a happy good news [inaudible 00:32:48].
David Goldstein:
It’s not like we don’t know in general how horrible our system is, but not having gone through it ourselves, you can’t know the particulars. And of course, that’s a particularly terrible example because, of course, as a pregnant mother, you want to tell the doctors and nurses the truth about your health, it’s in the interest of the baby, that’s what you want to be honest with your doctor, and then we prosecute you for it, for doing the right thing for the baby.
Wendy Bach:
Right. And we want you to tell your doctor that, right? That’s what HIPAA is supposed to do, but for a variety of complicated legal reasons, and not so legal reasons, that’s not what happened.
David Goldstein:
So I guess the takeaway is child tax credit, great, a lot more work to do.
Wendy Bach:
I think that’s a fair takeaway.
Nick Hanauer:
I love it.
David Goldstein:
Final question, Nick.
Nick Hanauer:
Yeah. So Wendy, why do you do this work?
Wendy Bach:
So I can tell you sort of like post Holocaust immigrant Jewish families story, but I won’t go that far back.
David Goldstein:
That’s all of us.
Wendy Bach:
Yeah, that’s all… I figured with your name. But I graduated from a fancy college, went to work in a women’s shelter, saw all kinds of things that I had no idea or truth, some of the things we’re talking about. So I get into law school, and I graduated from law school in May of 1996. In August of 1996, Bill Clinton signs the Personal Responsibility Act and eliminates welfare. And in September, I started the Legal Aid Society in Brooklyn, doing eviction defense. And between that day and today, 25 years later, for about 10 years as a practicing lawyer, and for the rest of the time as a law professor teaching in a legal clinic setting, I’ve stood next to clients who have experienced these systems and that’s been a great privilege in my life.
But what I’ve seen that is what we’ve been talking about, and it became very clear to me that this is how it works very early on in my career. So when I became an academic and thought about what I wanted to spend my time researching, writing about, telling that story seemed like a good use of my fairly wonky skills.
Nick Hanauer:
Yeah, it’s an amazing story. And it’s an amazing fact that because powerful people are completely insulated from the reality of these systems, they’re just invisible, right? I mean, on paper, I’m sure they seemed sensible to someone at the time. But because virtually no one in our political system or in our power structure has ever had to fight through this nonsense, that it just remains invisible and ignored and frankly, supported, right? Wow.
Wendy Bach:
It also serves lots of people’s interest to do-
Nick Hanauer:
Yeah, of course it does.
Wendy Bach:
Right? I am not a believer that this stuff happens by accident. I think systems function the way they’re supposed to. And that’s a sad fact about what we think about poor people and what we think about race in this country.
Nick Hanauer:
Yeah. Well, there you have it.
Wendy Bach:
This was fun, you guys. Thank you so much.
David Goldstein:
I really enjoyed it.
Nick Hanauer:
Yeah, absolutely fantastic conversation.
Wendy Bach:
Thank you.
Nick Hanauer:
Thank you so much for doing it. And for sure, we’d love to have you back when your book comes out. Awesome. Okay, bye-bye.
Wendy Bach:
Bye.
David Goldstein:
Bye-bye.
Mendoza:
My name is [Lupe 00:36:41] Mendoza, I live in Walla Walla, Washington. I am a single mother to five boys. Four of them currently still live at home, the oldest 21 and the youngest eight. For work, I am a Family Support Specialist with the ECEAP preschool program, a state-funded preschool program for kiddos ages three and four. And it is an income-based program. I work with a caseload of 40 families when my program is fully enrolled. I help navigate families to any type of resource that we have in the community. And that can be from electric help, rent help, food bank, getting Pampers, hygiene staff, you name it.
What it was like for my family when the pandemic first hit, it was complete shambles and chaos, trying to navigate three different grades, and sitting down and helping them do their work was extremely hard. I would work my full day on a computer at the table, have my kiddos doing their school online, and then I would sit down and try to help them, not only that, just mentally exhausting for myself as a single parent. I do have an amazing support group, but it was really hard. So during the pandemic, my household changes really skyrocketed. My grocery bill, which it normally averages out to anywhere from four to $500 a month, because I have boys and they eat me at a house and home, that nearly tripled. There was some months that I did have to say I can’t pay this bill because we need food.
I mean, it literally felt like we had 20 lunches, 20 dinners, and then in between there, there was like 90 snacks a day. It was constantly a battle. And when I’m in the midst of working, yes, I’m home, but it was still hard to navigate like, “No, you can’t go to the kitchen.” And yes, we had rules, yes, there was boundaries, but they’re boys, they know how to sneak stuff. Our electric bill doubled because now there is five of us full-time on computers, eight hours a day, which that was not there before, everything was shut off when we were gone during the day, the heat bill, I mean, all my bills went up just because we were using them twice as much.
The way it made up the difference. And as my job I have to know every single resource, so I knew the resources and I knew that they couldn’t cut off my electric bill or my gas if I needed it. So I would have to make that choice to sacrifice, “Well, do I not pay that bill this month and put more food into the home or do I not and then end up using a resource as far as going to the food bank?” So I would choose to not pay that bill one month and be able to put that extra food in the home to have, that is what worked. That is how I had to manage and to keep stability and things the same and not allow my kids to know that we were struggling or that it was difficult for us. I needed to keep normalcy for them.
When I first heard I was receiving the child tax credit, it was a sigh of relief for me because it was in the middle of having to move and my finances were already tight as it is. Because as I’m juggling the bills, I’m still playing catch up, I was like, “Oh, okay, that is going to help with the gas back and forth, that is going to help me with the whole rental, now I can afford it.” And I didn’t have to ask my mom to borrow the money because that was my last resort. So it was a sigh of relief for me, just a little breather. So half the money went to moving expenses and then the other half, I bought my two younger boys more clothing because they just obviously expanded both sideways and long ways and they had outgrown all their clothes. So we had no choice but to spend that extra money.
I didn’t want to count on it, I didn’t want to say, “Oh, I have this $750 coming that is going to make things easier for me.” It came through when we really needed it the most. I would explain the importance of the expanded child tax credit to somebody as that it comes when you least expect it and it comes when you need it the most. And that can look very different for every family situation. And it may be just that little bit that you need to top off whatever bill you have or it may even be a tiny little trip that you have not been able to take all year or all summer. That credit, it is really important because it’s very individual for every family. Our needs look totally different, it’s from putting that extra food on your table to paying that extra bill, it can look many, many different ways, but it is a huge stress reliever. I always have anxiety, I always have stress, but it is just that extra breather that I can take.
Nick Hanauer:
Honestly, I feel like I’m pretty well acquainted with the time tax stuff that Annie Lowery talks about in her Atlantic article, because as I may have mentioned on the podcast before, one of the things that my family does, my wife mostly, is she directly assists a low income family and sort of as a mentor to the mom and helps her navigate these systems, and they are horrendous. I mean, it’s just astonishing how hard it is to be poor, right? How difficult the systems are, how contradictory, difficult to navigate. You get assistant, one of these things in place, and then God forbid, you get a job, and they take them all away. I mean, the whole thing is just a mess. But I had never really been exposed to the whole criminalization part of it, right? These legal hurdles that are put in place that put you in jeopardy for frankly, doing things that either your poverty makes necessary, right?
Like not having enough food around for your kids, which is one of the consequences of poverty or doing things that everyone else in the society does with impunity like smoking pot, or whatever it is, or drinking or doing the sort of things that rich people do all the time and don’t ever get pressed on. So that was really interesting and really worth understanding better.
David Goldstein:
It’s very easy for a streak of bad luck to turn into suddenly finding yourself food insecure, housing insecure or homeless. And that’s why it was so important during COVID that we passed these relief packages that were rather extraordinary in terms of the past 40, 50, 60 years, but which prevented so much misery, not to mention kept the economy afloat.
Nick Hanauer:
Absolutely. I mean, to be clear, the child tax credit is a great victory for most families and a great victory for government and it’s cause to celebrate. And I think we all need to work hard to ensure that it continues, that it becomes a permanent benefit for families, which I think would make a big difference to a huge number of people.
Speaker 4:
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