2017 Federal Tax Bill Hurts America’s Most Vulnerable

The 2017 Federal tax bill threatens the future of programs that reduce poverty among children and the elderly. Congress is preparing to pass tax reform legislation that will greatly benefit the wealthiest households in America and provide much smaller, if any, benefit to poor and middle class households. The reduction in revenues will greatly increase the risk that major funding cuts will occur over the next decade to programs that have greatly reduced poverty in the U.S. since the 1960’s. These programs, including Food Stamps, Medicaid, CHIP housing assistance, and the Earned Income Tax Credit (EITC) have reduced poverty among children by 40-50% since the 1960’s. Medicare, Medicaid, and Social Security have reduced poverty among the elderly from 40% in the absence of these to under 10% with them. These highly effective programs have been placed in great jeopardy by the tax cut bill which will erode the revenues needed to maintain their current capacities to reduce poverty among American’s most vulnerable populations. 

Child Poverty Falls to Record Low, Comprehensive Measure Shows Stronger Government Policies Account for Long-Term Improvement

The child poverty rate fell to a record low of 15.6 percent in 2016, a little more than half its 1967 level of 28.4 percent.  This finding emerges from a new poverty series we have developed that combines the Census Bureau’s poverty data for 2016 with long-term poverty data compiled by Columbia University researchers.  The new poverty series relies on the federal government’s Supplemental Poverty Measure (SPM), a comprehensive yardstick that most analysts believe provides a more accurate assessment of the resources available to low-income households to meet basic needs than the “official” poverty measure does.  That’s because the SPM counts the income that the Supplemental Nutrition Assistance Program (SNAP, formerly known as the Food Stamp Program), rental subsidies, and other federal non-cash benefits and refundable tax credits provide, while the “official” poverty measure ignores such benefits.

– Center on Budget and Policy Priorities

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Social Security Keeps 22 Million Americans Out of Poverty: A State-By-State Analysis

Social Security benefits play a vital role in reducing poverty in every state.. Without Social Security, 22.1 million more Americans would be poor, according to the latest available Census data.  Although most of those whom Social Security keeps out of poverty are elderly, nearly a third are under age 65, including 1.1 million children.  (See Table 1.)  Social Security is particularly important for elderly women and minority families, who have fewer retirement resources outside of Social Security.  Depending on their design, reductions in Social Security benefits could significantly increase poverty, particularly among the elderly.

– Center on Budget and Policy Priorities

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The Trojan Horse in the Tax Bill

Congressional Republicans have finally done it: Both the House and Senate passed tax legislation. The bill has now headed to President Trump’s desk for his signature. Most dissection of the plan has focused, for obvious reasons, on the way it changes our tax bills. The Tax Policy Center found that in the first years most people would get a tax cut, although the biggest cuts are reserved for the wealthiest. By 2027, lower- and middle-income Americans would get no benefit or actually pay more in taxes. But this bill also serves as a setup for steep government cuts. Programs from Medicare to flood insurance to food stamps will be at risk the moment President Trump’s signature dries. Some reductions would be inflicted automatically. Others, Republicans will pursue with a handy justification — the revenue hole created by their own legislation.

– The New York Times

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