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Reducing Poverty: Sen. Tammy Baldwin Talks American Rescue Plan Benefits

June 4, 2021

By Ana Martinez-Ortiz

George Hinton, the CEO of SDC, says that it is time to address the systems in place keeping people in poverty. (Screenshot by Ana Martinez-Ortiz)

George Hinton, the CEO of the Social Development Commission, is ready to see people thrive and not just survive. America is one of the richest countries in the world, he said, but its poverty levels are higher than most.

“We called it the war on poverty in 1965, but apparently it’s still on,” Hinton said. “And in some cases, we’re not winning it. So, I would say that this war continues.”

Hinton expressed his thoughts during a roundtable discussion in which panelists discussed the revised tax initiatives regarding the child tax credit and the earned income tax credit introduced under the American Rescue Plan. Community Advocates hosted the discussion, which featured Sen. Tammy Baldwin and several other community leaders on Wednesday, June 2.

“What a critical opportunity to talk about all of the strategies that we can use to reduce poverty and increase equity and especially focusing on children,” Baldwin said during the roundtable discussion.

Baldwin said that this conversation has been going on since before the pandemic. Many have wondered when Congress would address the growing wealth gap between groups.

However, because of the pandemic, Congress was able to pass the American Rescue Plan with modified changes on the child tax credit and earned income tax credit.

“We have the opportunity over the course of the next year to prove that these strategies work,” she said. “Half of all children in poverty are expected to be lifted out of poverty through these two simple inclusions in the American Rescue Plan.”

The next step, she said, is making these changes permanent and adding the additional elements that will make a lasting impact on poverty.

Parents could earn $3,600 for newborns to children aged 5, and $3,000 for children ages 6 to 17, Julie Kerksick, senior policy advocate at Community Advocates, explained. The child tax credit will be paid out on a monthly basis for the remaining of the year, she said.

Jon Peacock, the research director of Kids Forward, said the temporary provisions, which are in effect for 2021, will address two long standing issues: child poverty and severe racial disparities. Making these provisions permanent, will help children and the future of the nation’s economic prosperity, he said.

Previously, families with a higher income received a higher credit than families with a lower income. Under the American Rescue Plan, low-income families are eligible for the highest tax credit, Peacock explained.

People need to be aware of these changes and utilize the benefits, Sen. Tammy Baldwin says. (Screenshot by Ana Martinez-Ortiz)

“That change alone will benefit 27 million children nationally and will lift 4 million children above the poverty level,” he said. “In Wisconsin alone, making that change permanent, rather than ending it next year, would benefit an estimated 360,000 children and would lift 45,000 Wisconsin children above the poverty level. That’s a 45% reduction in child poverty in Wisconsin.”

Jason Dropik, the head of the Indian Community School, emphasized how these efforts can positively impact children in relation to education and nutrition. Children are the greatest gift, he said.

Education is the doorway to opportunity, he said, and when students can’t have their educational needs met because of poverty, that’s a problem. This tax credit could create opportunities for families to afford sustainable housing, afford healthy and nutritious food and more, Dropik said.

“We have an opportunity here to not just give them something but to really do some meaningful long-lasting change that will benefit them for their future families,” he said. “And that’s an investment in our future, that’s how we then create communities of change.”

Darryl Morin, president and chairman of the board for Forward Latino, noted that Latinos have some of the highest workforce participation rates in the Milwaukee area, yet a majority of the population live in poverty. The Latino population was disproportionally impacted by COVID-19, having made up 11% of the cases in the state despite being only 7.1% of the population.

The American Rescue Plan is going to help families, he said, and help lift them out of poverty. It’s real dollars, Morin stressed, that can go toward nutritious food and keeping the lights on.

If people have already filed their 2020 taxes, they should receive an automatic payment; if not they can visit the IRS website at irs.gov. There will be two virtual portals opened in June, one for non-filers to claim their tax credit by filing their taxes for 2019 and 2020, and one for recipients to report a change in circumstances, Kerksick said.

“Sustained poverty, especially generational poverty, does a lot of damage to families and individuals,” Hinton said.

He’s hopeful that initiatives under the American Rescue Plan will help people struggling to afford basic needs such as daycare, transportation, clothes and more. People need those basic necessities before they can even think about getting to the next level, he said.

Hinton said it is time to create real systemic change so that people have the opportunity to thrive in this country.

“We’re going to be strong advocates for change, not just transitional change but transformative change,” Hinton said. “We cannot continue to have so many people continuously live in poverty.”

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Popular Interests In This Article: Ana Martinez-Ortiz, George Hinton, Poverty, Tammy Baldwin

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