AEIdeas

The public policy blog of the American Enterprise Institute

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Discussion: (5 comments)

  1. More nonsense. If you want a good tax policy get rid of the 95% (or more) of government activities that are not authorized by the Constitution and let the private sector deliver what individuals want and need. If people want kids they should make up their own minds without worrying about the impact of taxes. If businessmen want to invest let them without worry about the confiscatory policies of the government. If people want to give money to Egypt or Israel let them send donations directly out of their own bank accounts, not ask the government to tax everyone and use the proceeds. The land of the free can only be free if government shrinks substantially and gets out of the way first.

  2. Andrew Biggs

    Jim,
    The trade-off is that larger deductions — for children or whatever — imply higher rates, all other things equal. Child tax credits could increase long-term economic growth if they raised the birth rate, which would help paygo entitlements like Social Security and Medicare. But a) they’d have to be fairly targeted to do so; and b) even then, taxes at the margin would still have to be higher. I’m definitely sympathetic to the child tax credit, but it’s part of the reason the income tax base has narrowed.

  3. Pro-family? Pro-Growth? When the government thinks you should only be allowed $500/child/yr tax credit but often gives $150/month to Food Stamp recipients, they ARE DESTROYING incentive and are ANTI-family. Clearly. Until the government, our servant, requires recipients of government ‘income, redistributed’ to accept the same reporting (1099-GOV) as “real” income earners(W2/1099-MISC) you are writing words on the outhouse walls.

    “1099-GOV”=Fairness (Labor\2)

    This equation defines what you want. It assumes 50% of earned income is susceptible to redistribution (Democrats love this) and solving for something like a food stamp benfit (1099-GOV’foodstamp’=$1800/yr) shows that a PRO-family tax benefit should at least by $3600/year/child.

  4. Upton Updike

    So if you aren’t taxing parents and you aren’t taxing the rich (as described elsewhere on this site) then who’s left?

    Me.

  5. Recognizing that this is not going to be popular on this site, I would love to hear Mr. Pethokoukis’ take on this: http://www.slate.com/articles/life/family/2012/11/socialist_child_care_in_europe_creche_ecole_maternelle_and_french_child.html

    As a parent of three, I can affirm that universal pre-K and daycare would do far, far more to promote families to have more children than any amount of tax credits. Indeed, for most families with multiple children that I know, their child care costs can exceed their mortgage. Doubling the child tax credit, or making it deductible against payroll taxes — while steps in the right direction — are simply not sizable enough to make an impact on the costs here.

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