Jordan Weissmann, Matt Yglesias cover JFI's microsimulation briefs
JFI’s microsimulations, by Jack Landry and Stephen Nuñez, provide rapid analysis in response to federal policy debates about the Child Tax Credit. The briefs have contributed a quantitative research grounding to recent analyses by Jordan Weissmann in Slate and Matthew Yglesias in Slow Boring.
Weissmann’s piece is “There Are at Least Two Extremely Good Things to Celebrate in Biden’s New Build Back Better Plan”:
The Build Back Better plan will extend the full, souped-up version of the credit for just one year—doing it for longer would have been incredibly expensive—but it will become fully refundable on a permanent basis. It’s a true milestone in the history of America’s social safety net that Democrats should be proud of: Going forward, the United States will extend unconditional cash support to even the poorest kids. According to the Jain Family Institute, the move could reduce future child poverty by 19 percent.
Yglesias’s piece is “$1.75 trillion is plenty of money to write a good Build Back Better bill”:
Permanent, full refundability is expensive but doable. I think the “fair” way to think about this is that [Tax Cuts and Jobs Act]’s CTC is going to be made permanent in 2025. So the “real” cost of making full refundability permanent is that you should assume TCJA CTC is permanent, and then ask what’s the incremental cost on top of that. Analysts at [JFI] think that would cost about $170 billion over 10 years, and also that the methodology that Congress’ Joint Committee on Taxation uses to produce official scores would count it as a cheaper $120 billion.
That’s quite affordable. But Manchin might still deride that as a gimmick because you’re assuming the cost of making TCJA permanent. He shouldn’t deride it as a gimmick because by his own logic, it’s the TCJA expiration that’s the gimmick. But I don’t want to count on Manchin being reasonable, so Jack Landry and Stephen Nuñez were kind enough to run it a few different ways.