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Testimony

Testimony on Anti-Poverty and Family Support Provisions in the Tax Code

Senate Committee on Finance

June 15, 2023

Introduction

Chairman Wyden, Ranking Member Crapo, and distinguished members of Committee, thank you for the opportunity to testify. My name is Bruce D. Meyer, and I am the McCormick Foundation Professor of Public Policy at the University of Chicago Harris School of Public Policy. I have spent forty years researching the effects of government programs for those suffering disadvantage or with low incomes. My approach is to see what the facts say, not presuppose answers to policy questions. While I am testifying on behalf of the Republican minority, I am not a partisan individual. Federal Election Commission data will tell you that I have never donated to Republicans and frequently donated to Democrats. I was proud to work with a little known Illinois State Senator in the late 1990s, Barack Obama, to pass a state earned income tax credit because my research suggested that such a credit would reduce poverty and encourage work at the same time. I thought it was a good use of evidence when President Clinton cited that same research. President Clinton also signed bipartisan legislation to convert a welfare system that discouraged work and prolonged poverty into one that promoted work and financial independence. Times have changed. This legislative body came within a vote of reversing the pro-work incentives of the existing Child Tax Credit (CTC). I am specifically talking about the replacement of the CTC with a child allowance as included in Build Back Better Act of 2021 and other proposals. Such proposals would largely reverse the bipartisan welfare reforms of the 1990s that encouraged work, reduced poverty, and encouraged responsible parenting. I refer specifically to proposals that would make the CTC completely refundable as a child allowance, essentially converting the CTC from a credit against taxes to a cash welfare program administered by the Internal Revenue Service, conditioned neither on work nor payment of taxes

Read the full testimony here.