The country's child poverty rate more than doubled between 2021 and 2022, a new report published Tuesday from the Census Bureau revealed, an increase that is largely the fault of Congressional Republicans' blocking the Child Tax Credit enhancement for 2022, according to President Joe Biden.
In the span of a year, the Census Bureau found that the United States' rate for child poverty went from a historic low of 5.2% in 2021 to 12.4% in 2022, noting in the "Income, Poverty and Health Insurance Coverage in the United States: 2022" report that the expirations of temporary enhancements to the Child Tax Credit and other key government policies lead to an overall rise in poverty in the supplemental poverty measure, which extends the official measure by accounting for government programs designed to aid low-income families, last year.
Wow. This is such a tragic chart.
— Heather Long (@byHeatherLong) September 12, 2023
**Child poverty in the United States more than doubled in 2022**
2022 child poverty rate: 12.4%
2021 child poverty rate: 5.2% (a historic low)
This did not have to happen. It's largely due to ending the enhanced Child Tax Credit. pic.twitter.com/VUDQJKYcOs
"Today's reported rise in child poverty is the result of Congressional Republicans' choice to block our Child Tax Credit enhancements and advance tax cuts for wealthy and big corporations instead," Biden said on X, the platform formerly known as Twitter, Tuesday, vowing to continue advocating for the "expanded Child Tax Credit and get families the relief they deserve."
Today's reported rise in child poverty is the result of Congressional Republicans' choice to block our Child Tax Credit enhancements and advance tax cuts for wealthy and big corporations instead.
— President Biden (@POTUS) September 12, 2023
I'll continue to fight to restore the expanded Child Tax Credit and get families…
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The Child Tax Credit was expanded in 2021 under the American Rescue Plan, which increased its yearly payout to qualifying working-class households from $2,000 to $3,000 per child for children over 6 years old and from $2,000 to $3,600 for all children under six, and increased the age range for older children from 16 to 17.
President Biden proposed an extension of the enhancements to the Child Tax Credit into 2022 in the Build Back Better Act. Though the legislation passed the House, it stalled in the Senate and the enhancements were excluded from the Inflation Reduction Act passed last year.
"The idea I've been talking about with Trump is: Why don't we go to 15 percent corporate rate, get rid of the credits and deductions, and just make it 15 percent."
But as the White House laments the leap in the United States' supplemental poverty rate and lambasts congressional Republicans for their role in the growth, former President Donald Trump and his advisors are setting sight on an aggressive tax cut plan to push during his bid to return to the Oval Office, The Washington Post reports.
Trump and his advisors have talked deeper cuts to both individual and corporate tax rates that would ultimately further his controversial 2017 tax law, which slashed the federal corporate tax rate from 35% to 21% and ended some business loopholes, a half-dozen people close to the 2024 GOP frontrunner told the Post. A new 10% tariff on all imports in the United States, which Trump has promoted on the campaign trail and could raise hundreds of billions in revenue, would theoretically cover the bill for the cuts. The tax cuts would then work to offset higher consumer costs resulting from the tariffs' imposition.
The discussions are largely preliminary because it's unclear if Republicans would control both chambers of Congress, even if Trump were to win next year. However, the conversations demonstrate the high-stakes nature of economic policy in the 2024 election.
"There's a lot of conversation right now about what the next tax priorities of a potential Trump administration should be, including lower rates — which he clearly wants to do," Arthur Laffer, a Trump advisor and supply-side economist, told the Post. "Everyone is talking about taxes and what the new Trump administration would do."
Democrats, including Biden, have decried the Trump tax cuts for shoveling money back into the hands of the wealthy and large corporations. They enacted a 15% corporate tax minimum as part of the Inflation Reduction Act.
Trump's advisors, however, have floated proposals to deepen the cut to the overall federal corporate tax rate to possibly as low as 15 percent, or to use the revenue from the proposed tariffs to pay a dividend to U.S. households. The former president has not identified a specific potential corporate tax rate but has publicly mentioned using revenue from the new tariffs to mitigate taxes on U.S. producers.
"There are many ideas coming in about how to undo the damage Joe Biden has done, and President Trump's America First economic focus remains how we create more higher-paying jobs for American workers, and he will do whatever it takes to make our Country competitive again," Jason Miller, a Trump campaign spokesman, said in a statement.
"Trump has not yet committed to specific tax cut numbers for his second term agenda, and his focus will be on how best to help American workers," Miller added.
Further curtailing corporate taxes, which would mostly advance large companies, would come at a crossroads with the GOP's growing antagonism toward publicly traded firms, which many Republicans claim side with liberals on cultural matters. Democrats also hope the Trump campaign will embrace expanding the corporate tax cut.
"It would be astonishing for Trump's team to double down on the most unpopular parts of the tax cuts, which were the corporate tax cuts, by driving it down even further," Federal Policy Director at the left-leaning Institute on Taxation and Economic Policy Steve Wamhoff told the Post. "We have plenty of data showing most Americans want corporations to pay more in taxes, not less — this was true when Trump and his supporters in Congress enacted the 2017 law, and it's still true today."
White House spokesman Andrew Bates also slammed he proposal in a statement, saying that more "deficit-increasing tax welfare" for large corporations "would turn back the clock to the trickledown economics that hollowed out the American middle class and added trillions to the national debt."
The immediate priority for some congressional Republicans is extending a number of provisions from the 2017 tax law that are set to expire, which include credits for corporate investment and a number of individual provisions set to expire in 2025 such as the doubling of the standard deduction and a larger Child Tax Credit.
On an international level, the Biden administration has pushed for a 15% global minimum rate on corporations to prevent nations from competing against each other by lowering taxes beneath that value. According to Stephen Moore, an outside economic advisor to the former president, Trump, as part of his plans, may counter by meeting Biden's proposed minimum to show that the United States offers the most business-friendly playing field. That leg of the plan would come with an end to corporate tax deductions and other tax breaks, including new clean energy credits in the Inflation Reduction Act.
"The idea I've been talking about with Trump is: Why don't we go to 15 percent corporate rate, get rid of the credits and deductions, and just make it 15 percent," Moore told the Post. "That's one of the ideas that's being tossed around, as part of a Trump tax reform plan that would be accompanied by the tariff."
Trump's economic advisors have also pondered new ideas for the United States' tax policy with some outside advisors beginning to discuss potential names for possible treasury secretary nominees, including former World Bank president David Malpass, former Trump White House National Economic Council Director Larry Kudlow and Laffer, who served as an advisor for former President Reagan.
Despite the more pressing matters on the table for some, many Republicans welcome the opportunity to regain control of the government to approve additional tax cuts. Grover Norquist, an anti-tax activist and leader of Americans for Tax Reform, told the Post he's pitching GOP candidates, including Trump, to push for a 14% corporate tax rate, brining the U.S. rate below the global minimum.
"I'm pushing it wherever I can," Norquist said. "Everyone gets how great 15 percent would be. But why not 14 percent?"
