Federal pandemic-era aid – led by an historic expansion of the Child Tax Credit – helped cut America’s child poverty rate nearly in half in 2021. But these historic gains were wiped out in 2022 after Congress refused to renew the credit. Last year saw the largest one-year increase in poverty on record and a more than doubling of the child poverty rate. The Times-Picayune | Baton Rouge Advocate’s Will Sutton explains:
When the Louisiana Budget Project extrapolated the national supplemental child poverty percentages for our state, LBP found rather sad statistics: In 2021, Louisiana’s child population was about 1,066,180. Applying the national supplemental child poverty rate of 5.2%, that’s about 55,441 in poverty. In 2022, Louisiana’s child population was about 1,045,700. Applying the national supplemental child poverty rate of 12.4%, that’s about 129,665 living in poverty. That’s more than 74,200 additional Louisiana children living in poverty. “Since Louisiana’s child poverty rate is among the highest in the nation, these numbers are almost certainly an undercount,” Stacey Roussel of LBP said. “Estimates from the Center on Budget and Policy Priorities show that about 187,000 Louisiana children were at risk of slipping back below the poverty line or deeper into poverty when the national CTC was allowed to expire.”
Note: While Congress refuses to help, many states have created their own child tax credits. Unfortunately, Louisiana lawmakers recently rejected legislation to expand tax credits for low-income families with young children.
Holding legislatures accountable
Three years ago, then-state Sen. Rick Ward warned his Republican colleagues of the consequences if their efforts on “tort reform” – making it harder for people to recover damages from injuries sustained in car crashes – didn’t lower Louisiana’s high rates for car insurance. While premiums have increased since that time, there doesn’t seem to be an election-year blowback for the legislators who went along with the business lobby’s wishes. As Governing’s Alan Ehrenhalt explains, it’s part of a national trend:
[St. Louis University political scientist Steven] Rogers creatively but rather plausibly applies the idea to electoral politics. If state legislators know their seats are safe, and if voters have little knowledge of what representatives are doing, what is there to guard against mischief in the legislative chamber? Not very much. “Why,” Rogers asks, “should a legislator work to stimulate the economy or gain his constituents’ approval if a voter’s election day decision is not based on his own performance?”
Earn while you learn
A workforce-training program in Washington, D.C is providing an onramp to the middle class by paying people while they get trained in high-demand jobs. Arlen Herrell, deputy chief with the D.C. Department of Employment Services, speaking last week at the Invest in Louisiana Policy Conference, explained that he hopes to expand the program to other cities across the country. The Baton Rouge Business Report’s David Jacobs reports:
Along with job-specific training, it provides two weeks of general “work readiness” training, since many participants are new to the workforce or have not worked in some time. Job fields include commercial driving, energy and utilities, auto mechanic, construction safety and solar panel installation. Herrell says the program works with partner employers to tweak training as needed. “If you have a job, and you need us to train somebody to do that job so you can hire locally, we’ll figure out how to do it,” he says.
IRS overhauls discriminatory system
The Internal Revenue Service is overhauling the way it audits low-income taxpayers who claim the Earned Income Tax Credit. It comes after a detailed study on race and the U.S. tax system released last January showed that Black taxpayers are more than three times as likely as other filers to be audited by the tax agency. The New York Times’ Alan Rappeport explains:
Tax returns that claim the E.I.T.C. have historically been more likely to be selected for audits, even if those investigations tend to yield little in taxes that are owed. Research has shown that audit rates for Black Americans are three to five times higher than for other taxpayers, with audits focused on the tax credit being a major driver of the disparity. … The letter acknowledged that its internal research has validated academic studies that have shown that scrutiny of the earned-income tax credit claims have propelled the disparity in how the tax code is enforced and made it far more likely for Black taxpayers to be audited.
Number of the Day
$178.4 million– Amount of federal funding from the bipartisan infrastructure law that will be used to restore passenger rail service in parts of Alabama, Louisiana and Mississippi that are along the Gulf of Mexico. (Source: Associated Press)