Research shows that kids are in crisis. Across the country, one of every six children live in poverty. Here in Michigan, our children experience well-being outcomes below the national average, and their experiences heavily depend on their race.
Living in poverty during childhood has longitudinal and multi-dimensional consequences. Though usually framed in acute terms such as missing a meal or not owning a winter coat, research points to the considerable cumulative effects of childhood poverty that can last into adulthood. Michigan children specifically struggle across multiple dimensions that could be addressed by a state-level child tax credit (CTC), namely vis-à-vis economic security, health, and education.
The federal child tax credit does not reach many families in need because of the way it’s structured. In response, leading non-profit, non-partisan organizations have called on states to bridge the gap through a state-level child tax credit. Research shows that income supplements, like the CTC, improve children’s outcomes in three fundamental ways: economically, psychologically, and epidemiologically. A robust body of research shows that the recipients of working-family tax credits and their children reap intergenerational work, income, educational, and health benefits.
Four states have recently sought to supplement the federal CTC with their own state version. By taking different approaches, they provide compelling case studies to consider for others looking to follow their lead. While there are a broad range of policy options (e.g., non-refundable v. refundable, targeted eligibility, etc.) at Michigan’s disposal, this report outlines six options.
The public is ready to end child poverty—and the public believes it’s the government’s responsibility to do so. In an extremely polarized political climate, the plight of children is common ground. A state-level child tax credit is a realistic and substantive policy option to fight childhood poverty in the state of Michigan. Rarely do political feasibility and program efficacy overlap as much as they do for a state CTC; this is an opportunity that Michigan cannot afford to let pass. My hope is that policymakers and decisionmakers consider these approaches to combating childhood poverty in Michigan.