Essay: Increasing the maximum EITC for families
The challenges to increasing the human capital of low wage parents are formidable and models that substantially raise earnings may not emerge soon. We do, however, know how to write checks. Until successful models are in place, increasing cash and in-kind aid to poor children may be a sound alternative investment. One incremental option is to increase the maximum EITC for families with three or more children. An alternative is to provide larger EITC benefits when children are young (say age 0 to 5) in light of evidence that the adverse effects of living in poverty are greater at younger ages. Larger EJTC benefits might also spur parents with young children and low earnings to earn more. For severely disadvantaged parents with minimal earnings capacity or a complete inability to work, an indexed federal floor on TANF benefits would modestly improve their children’s standard of living.
Helping disadvantaged young men earn more has been especially challenging. Rigorous evaluation of Career Academies, a high school reform intended to keep students engaged in school and prepare them for postsecondary education and employment, has found sustained earnings gains for Academy students compared to students in a control group. Young men in Academies also experienced positive impacts on marriage and being custodial parents (Kemple, 2008). Mead’s (2007) recommendation to have the child support and criminal justice systems require men to work and to support this requirement by helping them find work may deserve a rigorously evaluated demonstration.
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