By Areesa Somani
Federal safety net programs, including refundable tax credits, have driven a steep decline in child poverty over the last several decades, according to a new report from the Center on Budget and Policy Priorities.
The report, Child Poverty Falls to Record Low, Comprehensive Measure Shows Stronger Government Policies Account for Long-Term Improvement, uses data from the federal Supplemental Poverty Measure, which is considered more accurate than the “official” poverty measure because it includes income from SNAP (formerly Food Stamps), rental subsidies, and other federal non-cash benefits and refundable tax credits like the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC).
Using this measure, the report authors found that the child poverty rate fell to a record low of 15.6 percent in 2016 — nearly half the 1967 rate. Additionally, government programs in 2014 reduced the number of children in poverty by 38 percent.
Refundable tax credits and SNAP benefits have had the greatest impact on child poverty, according to the report. Since the EITC and CTC were established and expanded, they alone have lifted nearly 5 million children out of poverty. Nationwide implementation of SNAP in the early 1970s lifted millions of additional children out of poverty.
The report authors assert that refundable tax credits have long-term as well as immediate benefits. In addition to creating immediate work incentives for low-income adults, resources acquired through tax credits help children do better in school and increase their earning power as adults.
The report notes that with one in seven children living in poverty, there are still too many poor children in this country. It calls on policymakers to support these programs that reduce child poverty and promote children’s upward mobility.
To read the full report, click here.