IIf the Democrats’ Build Back Better Act negotiations had gone differently, tens of millions of American families would have received checks on Tuesday. Instead, for the third month in a row, monthly payments of the expanded child tax credit have not been distributed.
The monthly checks, which were approved last year under Joe Biden’s coronavirus relief package, had become a lifeline for many families struggling to recover financially from the pandemic. But the payments ended in December, after Democrats failed to pass their Build Back Better Act, which would have extended the policy.
These monthly payments helped lift millions of American children temporarily out of poverty, and the abandonment of the policy had a devastating effect. According to a report by Columbia University’s Center on Poverty and Social Policy, an additional 3.7 million American children were experiencing poverty in January, after monthly payments ended. The increase was disproportionately high among black and Latino children.
Progressives have continued to advocate for credit expansion, insisting that an extension of monthly payments should be included in any social spending package Democrats can secure through Congress.
But politics appears to have no way forward in an evenly divided Senate, underscoring Democrats’ challenges in trying to advance Biden’s economic agenda. Some Democrats worry that not extending the expanded credit will further hurt the party’s prospects in the midterm elections, making it harder for candidates to argue for re-election with voters.
The expanded tax credit was originally enacted as part of the U.S. bailout, which Biden signed into law last March. The new policy increased the tax benefit from $2,000 per year to a maximum of $3,600 per year for children aged five or under and to a maximum of $3,000 per year for children aged 6 to 17 years. The credit allowed families to collect half of the benefit through monthly checks, which were distributed between July and December last year. The policy also made the tax credit fully refundable, meaning more low-income parents could access the funds. In December, the last month the payments were sent, more than 36 million American households received checks.
“Talk about a proven program in spades. So efficient, so necessary. We saw the results immediately,” Pramila Jayapal, chair of the Congressional Progressive Caucus, said Thursday. Jayapal even invited a mother of three from Seattle who received the monthly payments, Leanne Do, as a “virtual guest” to the State of the Union earlier this month.
Despite the obvious impact of the payments and progressives’ passion for politics, Democrats appear to be at an impasse when it comes to continuing monthly checks. The version of the Build Back Better Act that passed the House in November included a one-year extension of the expanded child tax credit. But that bill stalled in the Senate due to Senator Joe Manchin’s opposition to the proposal.
“It’s a question of who can get 50 votes. And unfortunately, we still run into that barrier,” Jayapal said. “I don’t know what to say other than it’s incredibly frustrating for a lot of us.”
Democrats are now trying to resurrect elements of the Build Back Better Act that can win Manchin’s approval, particularly provisions aimed at tackling climate change and lowering prescription drug costs. But as the party again approaches negotiations with caution, there has been evidently little mention of extending the expanded Child Tax Credit.
In his State of the Union address, Biden stressed the importance of implementing various elements of his economic agenda, including strengthening domestic supply chains and investing in clean energy sources. In the hour-long speech, Biden devoted only half a sentence to the expanded child tax credit.
“Raise the minimum wage to $15 an hour and extend the child tax credit, so no one has to raise a family in poverty,” Biden told lawmakers.
On Monday, the president acknowledged the challenges he faced trying to extend the expanded credit. “It was something we should do again, but I’m having trouble getting it passed again,” Biden said at the National League of Cities Congressional Cities Conference.
This problem is largely due to a member of Biden’s own party. Manchin announced in December that he would not support the Build Back Better Act, saying the bill’s $1.7 billion price tag was too much to bear as US inflation hit a 40-year high. . Privately, Manchin also told colleagues he was worried parents were wasting money from the expanded child drug tax credit, according to HuffPost. (Surveys show that parents report spending the extra money on food, rent and utilities.)
Progressives in Congress continue to fight for this policy, but they are lucid about the chances of passing an extension with the weakest of majorities in the Senate.
“In terms of the way forward, I’d like to say yes, but at this point I don’t see it and I haven’t heard a lot of conversations about how to get there,” the progressive MP said. Cori Bush, who noted that many of her constituents were “devastated” when the payments ended.
If the policy is not restored, it could deal another blow to the Democrats already dark prospects for the midterm elections. Republicans are currently favored to regain control of the House, and the failure to pass the Build Back Better Act – and in particular the extension of the expanded child tax credit – could make voters even less inclined to re-elect Democrats.
Party leaders have tried to cast Congress’ failure to extend payments as a reflection on Republicans. Chris Taylor, spokesman for the Democratic Congressional Campaign Committee, noted that no Republicans supported the US bailout, which kicked off the monthly payment.
“We’re going to make sure the record is clear for voters: House Democrats delivered for families when the going got tough,” Taylor said. “All Republicans in Congress voted against helping your family.”
With the Build Back Better Act stalled, progressives are also trying to find other ways to help families in financial difficulty. On Thursday, the Congressional Progressive Caucus released a list of executive orders Biden should sign to advance the Democrats’ political agenda. The list includes demands to cut prescription drug costs, expand overtime eligibility and forgive federal student loan debt, among other suggestions.
Jayapal promised progressives would continue to push for passage of the Build Back Better Act, including an extension of the expanded child tax credit. But she argued that the proposed executive orders represent a solid starting point for helping average Americans’ monthly budgets, which in turn could boost Democrats’ chances in the medium term.
“We need to make sure that we address rising housing costs, child care costs, gas prices and all the things that we see right now – and that we take care of this for marginalized people,” Jayapal said Thursday. “Let’s quickly bring some relief to people. And yes, everything we do between now and November helps us.