Ending poverty is doable. That’s what our nation learned after Congress temporarily strengthened the Child Tax Credit.
It’s a lesson Oregon lawmakers should heed right now, as they have before them an opportunity to establish a state child tax credit — the Oregon Kids’ Credit. It’s a policy that would do a great deal to improve the economic security of Oregon’s most vulnerable children.
In 2021, with the nation still reeling from the pandemic, Congress passed a final emergency package containing an upgrade to the Child Tax Credit. It increased the size of the credit; made it payable on a monthly basis, rather than in a lump sum paid at tax time; and made it available to the lowest-paid families, who previously had been denied all or part of the tax credit.
The impact was immediate. Thanks mainly to the enhanced Child Tax Credit, the nation’s child poverty rate plunged, falling by nearly half compared to the prior year. Child poverty dropped to the lowest level on record.
For cash-strapped families, the enhanced Child Tax Credit was just what they needed. Families used it to pay for essentials like food and rent. They spent it on things like school supplies and after-school programs. As making ends meet became a little easier, levels of depression and anxiety among low-income parents declined.
The enhanced Child Tax Credit also proved capable of reducing racial inequities. Because of our nation’s long and shameful history of racial exclusion, Black, Indigenous, and other people of color are more likely to endure poverty. While most children who benefited from the enhanced federal credit were white, it narrowed the gap in poverty rates experienced by white children and children of color. The enhanced Child Tax Credit lifted up children of all races, while moving the nation in a more equitable direction.
But tragically, these gains were not to last. The improvements to the federal credit were temporary. And so far, Congress has failed to reinstate them, even as millions of children across the country fall back into poverty.
In the absence of federal action, it’s up to Oregon lawmakers to show leadership. They can do so by enacting the Oregon Kids’ Credit.
The Oregon Kids’ Credit would provide a $1,200 per child tax credit to low- and moderate-income families, those struggling the most to pay for essentials — a challenge made worse by rising prices. The legislation would lift up more than 200,000 children in Oregon. That’s more than all the children living in Central and Eastern Oregon, combined.
Research going back decades shows that growing up in poverty undermines the life prospects of children, from their chances of graduating from school, to their earnings as adults, to their overall health. Poverty stacks the deck against kids.
We know what works in the fight against poverty. We know that putting cash in the pockets of struggling families goes a long way in reducing economic hardship. The Oregon legislature must heed that lesson and enact the Oregon Kids’ Credit.