Childhood poverty did not double in the year since the Child Tax Credit ended, and Congress should resist any pressure or temptation to bring the expanded credit back.

The Left is jumping on a statistic from a recent Census Bureau report that says the childhood poverty rate “more than doubled” in the past year. It’s a misleading statistic that’s painting a false picture of well-being and dependency in America.

Here’s what’s really happening

The statistic the Left is focusing on is from the “supplemental poverty measure,” an unofficial and flawed measure that fails to properly include the value of government and employer-sponsored benefits and housing, and doesn’t measure material hardship. It’s a relative measure based on median expenditures, so it’s going to show “poverty” increasing when the economy is strong and families are spending more money.

If you look closer at the Census Bureau’s report, you’ll find this:

From the report: “The official poverty rate in 2022 was 11.5 percent, with 37.9 million people in poverty. Neither the rate nor the number in poverty was significantly different from 2021.”

Poverty didn’t go up—it decreased. Both overall poverty and child poverty!

Congress, don’t take the bait—expanding the Child Tax Credit is a bad idea

Armed with the misleading supplemental poverty statistic, the Left is calling on Washington to re-expand the Child Tax Credit, a pandemic-era Biden administration policy that led to monthly cash payments instead of a year-end, lump-sum credit. It also eliminated the earned income requirement that operated essentially as a work requirement that historically had been associated with the tax credit.  Removing the earned income requirement from the Child Tax Credit essentially turns the tax credit into a new welfare program.

Fortunately, it expired in 2021 and Congress has prudently rejected efforts to reinstate it.

With 10 million open jobs and millions of workers still missing from the workforce, now is not the time to hook another generation of American families on welfare and weaken our struggling economy. Re-expanding the Child Tax Credit after the Biden administration unlawfully and rapidly expanded food stamp benefits would be devastating for families and for our country.

Research has found that the expanded Child Tax Credit removes incentives to work, and will inevitably shift at least 1.5 million people away from the workforce. It’s also estimated that expanding the credit would add to further inflation and cost taxpayers $1.6 trillion over the next decade.

A better idea: Instead of expanding the Child Tax Credit, expand welfare work requirements and improve welfare program integrity

To fill open jobs, grow household income, put families on the path to self-sufficiency, and preserve resources for the truly needy, Congress should resist efforts to expand welfare or the Child Tax Credit and instead focus on enforcing welfare work requirements and improving welfare program integrity.

Here are a few ideas:

• Close loopholes like Broad-Based Categorical Eligibility in food stamps, which has allowed more than five million people—including millionaires—to enroll in food stamps without meeting federal eligibility criteria for assets, income, or both.
• Roll back the unlawful expansion of the food stamp program under the Biden administration.
• Require congressional approval of major rules to prevent out-of-control spending like the Biden administration’s proposed student loan rule.
• Expand work requirements to more able-bodied adults. Even better—universal work requirements.

For more on reforms that protect resources for the truly needy, read FGA’s research here.