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Title: What a Child Allowance Like Canada’s Would Do for Child Poverty in America
Citation Type: Miscellaneous
Publication Year: 2020
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Abstract: The child poverty rate is higher in the United States than in any other wealthy nation, and the COVID-19 pandemic has further exacerbated this crisis. Among OECD Nations, the only countries with a higher incidence of child poverty are Chile, Israel, and Turkey.1 Pre-pandemic, at a time of “record low unemployment,” one-in-seven U.S. children (more than 10 million) lived in poverty,2 and 12.5 million children were food insecure and without consistent access to enough food “for an active, healthy life.”3 The crisis of child poverty in the United States directly threatens the personal development of millions of children and further compromises the economic health of the country. The recent report on reducing child poverty from the National Academy of Sciences (NAS) concludes that “the weight of the causal evidence indicates that poverty itself causes negative child outcomes, especially when it begins in early childhood or persists throughout a large share of a child’s life.”4 The report also finds that child poverty costs the nation between $800 billion and $1.1 trillion per year5 in terms of productivity, public safety and incarceration, health care expenditures, homelessness, and child maltreatment.6 The main reason that the child poverty rate is higher in the United States than other wealthy nations is that other nations have much more robust social policies for children. Almost all wealthy nations other than the United States provide some form of child allowance to help with the costs of raising children. Child allowances are part of these countries’ network of social policies, and many of these policies are highly effective at keeping children out of poverty.7 A notable example is the Canada Child Benefit, which was implemented as one of a number of policies designed to halve the poverty rate in Canada by 2030. The benefit is greatest for low-income families, who receive an allowance of roughly $4,000 per child, per year (and roughly $4,800 for the youngest children). The benefit phases out with income, so higher-income households receive only a partial benefit, and the highest income families are ineligible. While the Canada Child Benefit has only been in place for a short time, it has already been associated with significant reductions in the poverty rate, which fell by 20 percent between 2015 and 2017.
Url: https://production-tcf.imgix.net/app/uploads/2020/07/23163625/child-tax_pdf_final1.pdf
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Authors: Collyer, Sophie; Curran, Megan; Garfinkel, Irwin; Harris, David; Stabile, Mark; Waldfogel, Jane; Wimer, Christopher
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Data Collections: IPUMS CPS
Topics: Poverty and Welfare, Work, Family, and Time
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