Ideas From The Right: An Exclusive Interview With Brookings’s Ron Haskins

This issue is the latest in our new commentary series, “Ideas From The Right: Conservative Approaches to Tax Credits for Working Families,” designed to highlight new proposals from conservative policymakers and thought leaders on how to improve tax incentives like the Earned Income Tax Credit and Child Tax Credit. Ideas From The Right seeks to draw attention to the growing support for these credits at both the federal and state level while sparking discussion on the merits of different approaches and opportunities for consensus among conservatives and progressives.

In this issue, Lauren Pescatore of Tax Credits for Working Families interviews Ron Haskins, former White House and Congressional advisor on welfare issues, current co-director of the Center on Children and Families, Budgeting for National Priorities and senior fellow, economic studies at the Brookings Institution and senior consultant at the Annie E. Casey Foundation.

RonHaskinsWhy do you think tax credits for working families have recently catapulted to the forefront of so many conservative platforms?

Republicans have a long history of supporting the EITC. But a number of factors play into this recent surge in support – one of which is the current minimum wage vs. EITC debate. Republicans favor the EITC, especially in the midst of a minimum wage debate because it is much better targeted and arguably imposes less of a burden on the economy.

Will this be a contested issue among conservatives?

Definitely. Many conservatives believe the tax code should be used primarily to collect revenue. There are those who share Mitt Romney’s stance on the so-called “47 percenters” and believe tax credits, especially those that are refundable, do quite the opposite. Credit refundability will be a strong point of contention among Republican lawmakers.

The amount of EITC payments made in error is also a likely platform for conservative opponents of the credit. I think it’s wrong to say “fraud,” because I think most EITC overpayments are truly error. But some Republican leaders may turn to this issue as a reason to oppose any increases to the credit. There are not many federal programs with an error rate as high as the EITC.

How would improving work incentives like the Child Tax Credit and Earned Income Tax Credit help policymakers advance conservative goals?

Compared to other programs that are intended to help low-income families, these credits have “Republican” written all over them. They embrace conservative ideology by promoting hard work and stable families – these credits are intended to encourage work, can only be collected by those who are currently working and offer support for workers raising children.

In addition, we’ve seen a shift in conservative policy to target support towards the success of younger minority groups, young males in particular. There’s evidence that credits like the EITC encourage these young men to work. The hope is that an expanded EITC for childless workers would also help them continue to be successful throughout their careers and advance to higher-paying jobs. This is a group with potential to become self-sufficient middle-class workers, and that’s where we need to be focusing.

So, would you recommend lowering the age requirement to collect the EITC so that more young men are eligible for the credit?

I would. I’d be tempted to even recommend bringing the age requirement down to 19, but the problem with that is then you get students. A kid going to community college because that’s all he can afford, trying to get a technical degree, that’s a kid you want to help. But a middle-class student going to a four year college, that’s not who we need to focus on. So, lowering the age requirement for the EITC could get tricky.

Where do you see areas of opportunity for bipartisan collaboration around some of these proposals?

Of the various issues that are on the table right now, increasing the EITC for childless workers and noncustodial parents has a decent chance of garnering bipartisan support. The President has proposed an increased credit for these workers and Paul Ryan, Marco Rubio and Mike Lee have all expressed their support for an EITC reform that helps this group.

What obstacles do you foresee as possibly hindering these proposals from becoming law?

As I mentioned before, a standalone bill to improve the EITC or Child Tax Credit could have a pretty good chance of bipartisan endorsement. But I wouldn’t be surprised if a credit expansion gets tied into an overall tax reform package, either from the Democrats or the Republicans, and ultimately gets bogged down by a number of other issues the opposing party doesn’t support.