Wednesday, September 22, 2004

Sticking it to those 'Lucky Duckies'

Boston Globe: Sticking it to working families

Tom Oliphant today points out how Bush's tax package has screwed the poorest workin families and the Republican refusal to fix it. Part of the child tax credit was indexed and part not. So while a poor family earns less each year, their eligibility for the credit also decreases.

...And there's the rub. An analysis by the Urban Institute and the University of Wisconsin offers the example of a married couple with two children who work at the federal minimum wage of a puny $5.15 an hour. Three years ago, their income of $20,600 would have produced a child tax credit refund of $1,060. With a higher threshold two years later, the credit's value drops 5 percent to $1,010.

But that's just the tip of the iceberg. As ordinary Americans know too well, incomes downscale in the United States have been worse than stagnant in this decade. Not only has the minimum wage not budged in seven years, but family incomes above that have also suffered severely since 2000, and the suffering has been proportionately greater the lower you go on the income scale.

Moreover, this decline in earnings (even before inflation in cases like workers with less than a high school education or single parents) has been accompanied by large increases in the cost of necessities -- including everything from gasoline to health insurance for those low-income workers lucky enough to have any. In the expert analysis -- by Leonard Burman of the Urban Institute and John Karl Scholz of the University of Wisconsin -- a single parent who got a $109 credit in 2001 would have received nothing last year even though her earnings fell.
...
Bush and his Republican Congress buddies could fix all this substantially, by simply restoring the original $10,000 threshold. The cost to the government would have been $4.3 billion over five years.

The fact that they did nothing is eloquent testimony to the status of working families in today's political culture. The next time Bush trumpets his opposition to tax increases, John Kerry should say something about the 4 million families Bush prefers not to count.

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