Senators Call to Make Tax Credit Expansions in the American Rescue Plan Permanent
Washington, D.C. – Today, Colorado U.S. Senator Michael Bennet spoke on the Senate floor with U.S. Senators Sherrod Brown (D-Ohio), Cory Booker (D-N.J.), and Raphael Warnock (D-Ga.) about the expansion of the Child Tax Credit (CTC) and Earned Income Tax Credit (EITC) in the American Rescue Plan and the need to make these expansions permanent.
The expanded CTC and EITC, based on Bennet and Brown’s American Family Act and Working Families Tax Relief Act, will send much-needed relief to struggling families in Colorado and lift millions of kids out of poverty nationwide.
“We are cutting childhood poverty in half this year as a result of what we're doing, and 90% of American children are going to benefit,” Bennet said. “[T]he credit means the most to people making the least.”
“In this bill, we treated America's children like they are America's children. Like they really matter to us. Like we believe in their future and the future of our country. That they are filled with promise, no matter how poor they are, no matter what ZIP code they live in, rural or urban, they matter to us. They're visible to us. And then we're going to make them a priority. This is the biggest reduction in childhood poverty in the history of our country, and we need to make it permanent,” Bennet said.
“My goal is to end childhood poverty in this country. That's where I really want to be, because then I'll know we really are not going to hold some child's economic circumstances against them, but we're going to give every child in America the chance to run the foot race with each other. But 50% is pretty good. It's the best thing we've seen out of Washington in generations,” Bennet said.
Bennet’s full remarks as delivered are available below.
Thank you Mr. President. Thank you very much for being a part of this effort, and I want to thank my colleague from Ohio for his extraordinary leadership from the very beginning on both of these bills. He led on the EITC bill -- and I was very grateful to have the chance to be with him on that -- and I on the Child Tax Credit, and he was my partner from the very beginning on that, as was Senator Booker and Senator Harris, before she became Vice President Harris.
And I've only been here for 11 years, Mr. President, you've been here a shorter time than that. And I never thought this day would come. I never thought we would see this day. Before I came to the Senate, I was the Superintendent of the Denver Public Schools. That's a large urban district in Colorado. Most of the kids are kids of color. Most of the kids are kids living in poverty, and the parents are working two and three jobs, many of them. And no matter what they do, they can't get their kids out of poverty. No matter what they -- no matter how hard they work, they're not paid enough to get their kids out of poverty.
Over the last 11 years, I've had the great privilege of traveling the state of Colorado, and it is a diverse state. Politically, it's a diverse state. We have urban areas and rural areas. We've got some of the most dynamic economies and business environments in the country, and, therefore, on the planet. And yet if I had to summarize those town halls, it's really easy, and it's people that are coming to say, Michael, we are working really hard, but no matter what we do, we can't afford housing, health care, higher education, or early childhood education. We can't save.
We think our kids are going to live a more diminished life than the life that we lived, and we're already living less of a good life than our parents lived. And that, Mr. President, is the anecdotal reflection of an economy that for the last 50 years has worked really well for the top 10% of Americans, but has not worked for the bottom 90%. The bottom 90% is all of America, and their wages have been flat. And we have seen income inequality grow through two recessions -- the Great Recession, and now the COVID recession. And the gaps between more affluent families and poorer families has only grown as a result.
And everywhere I went this year, Mr. President -- I went to all 64 counties of Colorado during COVID -- I heard the same thing. Give us a little bit of hope. And that's what the American Rescue Plan is going to do. It's going to give people just a little bit of hope -- make it a little bit easier for people to buy groceries for their families or to pay the rent at the end of the month, pay their mortgage, set up a savings fund for their kids' college education. And that might sound like an obvious thing for us to want to do, but Washington for years has done exactly the opposite of what we're doing in this plan. Washington has passed one regressive tax cut after another saying they were cutting taxes for the middle class. That was a complete smoke screen.
Since 2000, they have cut -- listen to this -- $5 trillion of taxes, almost all of that has gone to the wealthiest people in the country when we've got the worst income inequality that we've had since 1928. It doesn't make any sense.
Can you imagine if the Mayor of Atlanta, Mr. President, went to his citizens and said we are going to borrow a bunch of money from the Chinese. And he said, well, we're going to borrow more money than we ever have before. And you say well that kind of worries me. What are you going to use that money for? And you say are you building infrastructure, roads and bridges? No. Are you going to invest in our schools? No. Our sewers? No? Mental health, something we need desperately across this country? No. Health care? No. What are you doing with the money? You're borrowing $5 trillion, what are you doing with the money? We are going to give it to the two wealthiest neighborhoods in Atlanta and hope that somehow it's going to trickle down to everybody else. That's how you write a bill which is the Trump tax bill, where 42% of the benefit of that bill -- it was a $2 trillion bill -- 42% went to the top 5% of Americans. To the people who needed it least.
This is exactly the opposite of that. 60% of our bill -- I'm not going to give you a lot of numbers, but 60% of our bill -- the majority of our bill -- goes to people making $50,000 or less. And as my colleagues have said, we are cutting childhood poverty in half this year as a result of what we're doing, and 90% of American children are going to benefit from what we're doing. That's about as broad based as you can get.
It's progressive in the sense that the greatest benefit is going to the poorest kids because the credit means the most to people making the least. But if you're making up to $150,000 as a couple, you're going to have a benefit for your kid. You'll get the full tax credit for your kid. So let me describe it a little bit, and then I'll talk about the Earned Income Tax Credit. Then I'm going to take over for the Presiding Officer, and I look forward to hearing what he has to say.
Most families under this change to the law are going to receive $250 a month per child. That's $300 a month for kids under the age of six. It's fully refundable. What does that mean? Well, there was a view about this tax credit before that said that you had to make a certain amount of money before you could be eligible for the tax credit because there was a theory that, you know, if you got the tax credit, you wouldn't work. That's not the problem. People are killing themselves --they're not getting paid. And so we say that you get, you get the tax credit from dollar zero, which means finally millions of America's poorest children who have been completely overlooked -- not just overlooked, ignored -- are going to get the tax credit. So millions and millions and millions of children who were too poor to benefit from what was going on here while we were cutting taxes for the richest people in America are now going to benefit from this tax credit, and it will make the biggest difference for them.
We are the wealthiest country in human history, and yet we have one of the largest, if not the largest,
childhood poverty rates in America. And as my colleague from New Jersey, Senator Booker, said -- I lost my train of thought. Let me see if I can get it back. I'm so excited about what we're doing, I can't believe it.
But as Senator Booker said, the largest group of poor people in America are children. In other words, children have the highest percentage poverty rates in our country. How can that be? How can we accept that as a permanent state of things?
Well, we're not, because of Joe Biden's bill we're cutting it in half, and we're saying in the richest country in the world, it is unacceptable for us to have one of the highest poverty rates. Other countries have cut their poverty rates by half. Why can't we? Well, today we are.
We also have some of the worst economic mobility rates in the world, in the industrialized world as
well, meaning it's hard to move up on the economic ladder. We used to say we're the land of opportunity. Unfortunately, there are a lot of other countries where people are able to get ahead by working hard. We want that to be our country again. And we want to give poor children a chance here.
There's not a single child that chooses to be born poor. And the senator from New Jersey quoted James Baldwin -- he's one of my favorite authors too -- about how expensive it is to be poor. The other thing that we have done in America is we have made it incredibly hard to be poor --incredibly hard to be poor.
And that's one of the interesting things about this bill, is in countries that have child benefits like this child benefit, they actually have a higher percentage of people in the workforce than we do. And why is that? It makes total sense. It makes total sense.
Because if you got a little bit of breathing room at the end of every month, you can fix a car that breaks down and you can stay on your job. If you can afford to pay for a little bit of child care, a few hours an afternoon, maybe that lets you stay on the job. And for working moms in particular, I think it's going to really create the opportunity for them to earn income over the long haul, because it will be easier for them to stay in their jobs than not.
As I mentioned, nationwide, over 90% of families -- 90% of children -- are going to benefit from this. So, Mr. President, over many nights, late nights, often on this floor, I have come here with one complaint or another about how we have turned our back on America's children. I have come here and I have said over and over again that we are treating America's children like they're someone else's children, not like they're America's children.
And you know what? In this bill, we treated America's children like they are America's children. Like they really matter to us. Like we believe in their future and the future of our country. That they are filled with promise, no matter how poor they are, no matter what ZIP code they live in, rural or urban, they matter to us. They're visible to us. And then we're going to make them a priority.
This is the biggest reduction in childhood poverty in the history of our country, and we need to make it permanent. And today, 40 of us sent a letter to President Biden saying that we're going to work with him to find a way to make this permanent.
My goal is to end childhood poverty in this country. That's where I really want to be, because then I'll know we really are not going to hold some child's economic circumstances against them, but we're going to give every child in America the chance to run the foot race with each other.
But 50% is pretty good. It's the best thing we've seen out of Washington in generations.
I want to just mention a few words also about the other bill that Senator Brown led on the Earned Income Tax Credit, which triples that credit for low-income workers that don't have kids. These are workers that don't have kids, that won't benefit from what we're doing to the Child Tax Credit but will benefit from what we're doing on the Earned Income Tax Credit.
Believe it or not, until now, until we passed this bill, Washington, D.C. was actually taxing people into poverty in this country. In other words, people were working, they were earning a living, and then they had to pay their taxes, and then they were in poverty. Because we're tripling the tax credit from about $500 to $1,500, that no longer will be true.
We also bring the minimum age down from 25 to 17, and we lift the cap for seniors so more people can benefit from this tax credit. In fact, 17 million people in this country are going to benefit from this change -- 300,000 workers in my home state of Colorado. And, these changes are going to transform lives. They are going to give folks a chance to breathe.
Just like all of you, I want an economy that when the economy grows, it grows for everybody, it doesn't grow just for the people at the very top. That's the economy we've had for the last 50 years. Such an economy is a threat to democracy.
You cannot have a democracy if you don't have an economy where everybody feels like they get ahead. It won't work. It's never worked in human history and I think it would be unreasonable for us to expect it would work here.
And it's created a lot of uncertainty, and in many places, a lot of anger, about whether the American Dream still exists for most Americans. I believe we'll be able to dream again here. And we're going to need, as I said, an economy that works for everybody.
That means investing in our infrastructure. That means having an approach to the competition, you know, from the competition from Chinese government that doesn't just leave us and our industries as collateral damage but creates thriving supply chains here and high-paying jobs here; make sure that we own auto manufacturing here and other kinds of manufacturing.
It means having an education system that can prepare people to do the jobs of the 21st century. That's work we still have to do.
It means that -- making sure that every single high school kid, or every single kid that graduates from high school, graduates knowing that they can earn not just a minimum wage but a living wage the day they walk out of their high school. That's what we need to do.
But in the meantime, this tax cut for working people and for low-income people, means that people are going to be able to put food on the table, save a little bit of money, get through this pandemic, make their lives a little bit better, and give their kids a little bit more hope.
I am really grateful -- I am really grateful -- that we elected a president and a vice president who's not treating America's children like they are someone else's children, but treating them like they are our children. That's not only the right thing to do for them, that is the essential thing to do if this democracy is going to survive.
Mr. President, I want to thank you for all your efforts on this bill as well since you joined the Senate. I’m going to stop there, and I'll come replace you. I yield the floor.