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Sen. Mitt Romney, R-Utah, answers questions as he meets with Podium employees in Lehi on Friday, Feb. 28, 2020.
Sen. Mitt Romney, R-Utah, pictured in this file photo on Friday, Feb. 28, 2020, answers questions as he meets with employees of a local company in Lehi. Romney’s proposed Family Security Act to address children in poverty has ignited a discussion among politicians and policy experts on both the left and the right about the merits of a child allowance.
Jeffrey D. Allred, Deseret News

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Mitt Romney’s child allowance plan: Love it or hate it, it’s hard to ignore

The anti-poverty proposal for children has ignited a discussion among politicians and policy experts on both the left and the right about the merits of a child allowance

The Family Security Act, Utah Republican Sen. Mitt Romney’s proposal to slash child poverty, has garnered a lot of attention — both laudatory and critical. And people lining up on either side may not be who most would expect.

The act would give a child allowance of $250 a month for school-aged children and $350 a month for those who are younger starting a few months before birth, with an annual cap of $1,250. Billed as deficit-neutral, Romney proposes paying for it by killing or streamlining existing programs and ditching federal deductions for state and local taxes. Among other changes, it would eliminate Temporary Assistance for Needy Families and the head of household income tax filing status.

Policymakers have a long history of attempting to raise American families out of poverty, from tax credits like the child tax credit and the earned income tax credit to welfare programs like the Temporary Assistance for Needy Families. But the pandemic engulfing America has turned a bright spotlight on the number of families in economic turmoil, despite two rounds of stimulus packages designed to help, including direct payments to lower- and middle-income families.

Dozens of family policy experts, legislators, political analysts and others have chimed in on the Romney proposal since details were released Thursday. The attention doesn’t surprise Lawrence Stacey, a doctoral sociology candidate at Ohio State University who just co-wrote a briefing on how COVID-19 has impacted low-income families for the Council on Contemporary Families.

“Family poverty in the U.S. is certainly not a new phenomenon,” said Stacey. “In 2019, prior to the pandemic, almost 15% of children were living below the poverty line, according to census data. The pandemic has simply made these economic challenges more severe and more prevalent across a broader range of the population. As a result, perhaps there is greater openness to finally providing families and children with the economic support that many have needed for quite some time.”

Unified desire to raise children from poverty doesn’t provide a unified vision of how it should be done, however. And there’s no single view of any of the provisions in Romney’s proposal.

Some critics, for instance, worry it amounts to a universal basic income for children, because there’s no work requirement for parents in order to access the funds and the income cap is quite large. Proponents hail those very factors as the best way to actually reduce childhood poverty in America.

While support has crossed political lines, opposition to Romney’s plan had risen within his own party — and from his own state.

Same party, different approach

Stacey and colleagues found more than half of families with children had less income from employment since the pandemic began. “As a result, nearly a quarter find it difficult to pay household expenses, more than half are experiencing food insecurity, nearly 1 in 4 families are late on rent, and about 1 in 10 are late on mortgage payments,” he told the Deseret News.

That creates a lot of fodder for concern, Stacey said, noting that “a large body of research shows childhood adversity has negative effects on social and cognitive development and well-being. Alarmingly, these consequences persist far into adulthood. Economic strain as severe as what we are witnessing might also pose risks for family and residential stability, both of which strongly shape child well-being.”

Still, how long economic strain lasts matters, too, he said. “Chronic enduring stress is much more harmful than short-term crises. This is certainly one argument for attempting to implement bold programs, such as the Family Security Act, to support families. Stopping this economic crisis for so many Americans will prevent its effects from leading to the kind of chronic, toxic stress that can harm well-being over the entire life course.”

Some praise the notion but dislike the details in Romney’s proposal, creating disagreement within and across philosophical lines. Ezra Klein, podcaster, author and New York Times opinion writer, tweeted, “One thing you really see in the Romney Child Allowance Plan Discourse is that all those studies saying social issues split the left and unite the right but economic issues unite the left and split the right are true.”

As the Deseret News reported, the day Romney revealed his plan, Utah’s senior senator, Mike Lee, also a Republican, and Sen. Marco Rubio, R-Fla., released a joint statement on proposals to expand the child tax credit, which they credit with helping millions of American families.

They favor increasing the child tax credit to $3,500 a year, with an extra $1,000 above that for children 5 and younger. But they oppose Romney’s child allowance.

Under Romney’s plan, parents would be eligible for the payment four months before their child’s due date, with a maximum monthly payment of $1,250. The plan would immediately lift nearly 3 million children out of poverty, while providing a bridge to the middle class, he said.

“That is not tax relief for working parents; it is welfare assistance,” Lee and Rubio countered, calling a work requirement “an essential part of being pro-family.” They want Congress to expand the child tax credit “without undercutting the responsibility of parents to work to provide for their families.”

Angela Rachidi, a scholar and poverty expert at the American Enterprise Institute, is blunt in her criticism of Romney’s proposal. She told the Deseret News that the notion of replacing Temporary Assistance for Needy Families — which has a work requirement — with a program that doesn’t “would reduce labor force participation among poor mothers and deprive them on a path toward upward mobility.”

She reemphasized the point in a news release from the institute Tuesday morning: “Careful analysis shows that such a program would strip the most vulnerable Americans of critical supports such as job training, domestic violence services and housing supports — all essential services for ensuring a path toward upward mobility,” said Rachidi, also a former deputy commissioner in New York City’s Department of Social Services.

“It would undermine the message that employment is essential for well-being and prosperity — instead sending nonworking families a check for a couple of hundred dollars each month while doing nothing to instill hope in a long-term path out of poverty,” she said.

She also wrote in an American Enterprise Institute blog, that “it can be deceptive to focus solely on the number of people a proposal ‘lifts out of poverty’ at a point in time, as my colleague Scott Winship points out. A child allowance would reduce poverty by raising families’ income just above the poverty level, but families also need a chance at mobility. For a vast majority of low-income families, employment is the only viable path to the middle class.”

Others see value in Romney’s proposal, including Lyman Stone, a demographer who’s a scholar at the Institute for Family Studies. In a long, detailed Twitter thread, he hailed the proposal as “being a big help to ‘breadwinner’-style working-class households. The benefit is designed to avoid marriage penalties for two-worker households, but it has the side effect of helping out a lot of working class breadwinners (male or female).

One of his criticisms of existing tax policy targeting child poverty is it contains disincentives to marry. Marriage penalties, he argues, harm families.

That Romney’s proposal takes the anti-child-poverty effort out of the tax code and places it with the Social Security Administration is itself a plus, some experts believe.

Said Stacey, “Writing benefits for families with dependent children into the tax code, rather than offering it in the form of an allowance, leaves too much to chance: tax literacy among parents, an income to qualify for the tax credit, and an ability to provide children with the necessities in the interim in the case of a refundable tax credit. Offering support to families with children in the form of an allowance instead will provide better day-to-day fiscal support for families who need it most.

“At this point, I’m for just about anything that redistributes money downward — within, of course, the confines of capitalism,” said Nicholas Wolfinger, a professor of family and consumer studies and adjunct professor of sociology at the University of Utah. “The U.S. has one of the highest rates of child poverty in the developed world, as well as the highest rate of income inequality.”

Compiling the praise

Romney’s office sent out its own press release on Monday, quoting some of the support his plan had received.

The Romney release quoted New York Times conservative columnist Ross Douthat: “The Romney plan offers something to left and right alike. It would significantly reduce child poverty, a core left-wing ambition. At the same time it reduces the current system’s penalties for marriage and its tacit bias against stay-at-home parents, both social-conservative goals, and raises the current subsidy for middle-class families, usually a Republican-leaning constituency. Finally, it’s both deficit neutral and softly pro-life, with a benefit that starts while the child is still in utero.”

The proposal would “substantially reduce poverty and drastically reduce extreme poverty, especially among children,” according to Ramesh Ponnuru, a visiting fellow at the American Enterprise Institute and a senior editor at the conservative National Review. “It would simplify government programs and probably make them easier to administer. It would also make it easier for people to start and expand their families.”

But Ponnuru also noted that the plan would be expensive, costing about $66 billion a year more than the child tax credit, he wrote in a Bloomberg opinion piece.

The Niskanen Center said starting the allowance several months before a child’s birth might boost prenatal health “while reaffirming the value of the unborn.”

Idrees Kahloon of The Economist expressed a hope that reflects the divisive political climate. Namely, that it could “ease Congress back onto the long-neglected path of bipartisan policymaking.”

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