A universal basic income for children may appear in the USA: when and under what conditions

Entrepreneurs, intellectuals and presidential candidates in recent years have touted a “universal basic income,” an unconditional cash benefit for all, as a response to poverty. But in the United States, these conversations never got off the ground. What the government has come up with to replace basic income, the newspaper said Fox News.

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Instead, something similar in spirit may appear, but cheaper and more practical. US President Joe Biden and Senator Mitt Romney have proposed expanding the child tax credit and removing many restrictions. So it will actually turn it into a near universal basic income for children.

The main goal of their proposals is to reduce child poverty, which is higher in the United States than in most developed countries. Both options would reduce the number of children living in poverty by about 3 million, or a third, according to the Niskanen Think Tank.

“This would be a huge change in the way we think about providing benefits,” said Elaine Maag, chief scientist at the Urban Institute.

Federal benefits usually require the recipient to meet certain criteria:

• Poor (for food stamps, Social Security, and Medicaid);
• unemployed (for unemployment insurance);
• working or looking for a job (earned income tax credit and some programs);
• disabled person (social insurance for disability).

About 90% of families with children are eligible for a tax credit (the maximum amount is $ 2). But many parents do not see this maximum for various reasons. For example, they have no tax arrears. So the most they can get is $ 000.

Biden's plan, detailed in legislative form, promulgated by House Democrats, will increase the loan to $ 3 for a child under 600 years old and a maximum of $ 6 for a child between 3 and 000 years old, while making him fully reimbursable, that is, even a parent with no income will receive the full amount.

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The increase will begin gradually for people earning $ 75 a year and couples with an income of $ 000. For individuals earning $ 150 a year and married couples with an income of $ 000, under current law, payments will be stopped. Romney plans to increase the loan for children under 200 even more - up to $ 000.

As a result, according to the Biden plan, families with two children usually received from $ 6 to $ 000. According to the Romney plan, from $ 7 to $ 200. For many parents, this is a lot of money, regardless of whether they work and whether how much they earn.

Equally important is how the plans are managed: Biden and Romney proposed that the loan would be paid off monthly, rather than once a year when the recipient files his tax return. Romney went even further and outsourced the job to the Social Security Administration, which already sends checks monthly to Social Security recipients. Biden will leave this to the IRS.

The IRS is better positioned to execute the plan immediately; it already benefits 95% of families with children and has shown it can send checks quickly, as it did with last year's pandemic legislation.

But Melissa Kearney, an economist at the University of Maryland, believes that naming and administering benefits through social security will highlight that this is not just another tax clause. While scholars consider the tax credit and the premium to be "mathematically equivalent, in practice they are not," she said.

Just as Social Security is a commitment to ending poverty in older people, she said, Child Benefit will do the same for children's needs.

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The Universal Basic Income (UBI) for children costs much less than income for everyone. UBI for adults, depending on the design, will cost anywhere from $ 1 trillion to $ 2,5 trillion per year. In contrast, Romney's plan would add $ 66 billion to operating expenses, which he would finance through the elimination of a number of tax provisions and federal social subsidies. Biden's plan will cost $ 105 billion. He has yet to identify a permanent source of funding.

UBI may dissuade many able-bodied adults from working, although experimental evidence is inconclusive. In contrast, the National Academy of Sciences estimates that an annual child benefit of $3 would reduce employment by only about 000 workers. Moreover, those who work less are likely to spend more time raising their children—a tradeoff that most Americans can agree with.

UBI for kids is also easier to sell politically. Many liberals love that much of the UBI for children goes to those on lower incomes without taking away other parts of the social safety net.

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