In my post a couple of days ago on the impending “stimulus” disaster, I only covered a handful of its larger squanderings of hard-earned taxpayer money. Needless to say, there are many, many more. $1.9 trillion is a lot of money to waste. Today comes news of a thoroughly co-ordinated effort to push a different big piece of this catastrophe, this one apparently in the range of up to $250 billion out of the $1.9 tril. As you read a little about it, you quickly realize that the $250 billion will just cover this year, and that the advocates intend that sum to be annually renewable.

The particular subject of this initiative is said to be “fighting child poverty.” Now, what kind of monster could possibly be against that?

What the initiative is really about is spending an additional $250 billion per year in the name of “fighting child poverty,” but specifically structured in a way that child poverty as measured cannot and will not be reduced in even the slightest amount. In whatever articles you read about the subject over the next days or weeks while the bill is pending, you will not see that aspect of the new spending mentioned. Except here. The “fighting child poverty” line is just the ruse they employ to try to get well-meaning people like you to fall for the scam.

When I say that this effort is “thoroughly co-ordinated,” I refer to the unusual fact that there are major pieces pushing it today in both the New York Times and the New York Post. An internet search indicates that many other outlets are also part of today’s push, many joining in by reprinting or rewriting the piece from the Times. But just focusing on the Times and the Post, it’s not common at all for these two sources from the opposite ends of the political spectrum to act in tandem like this. In the Times, the advocacy appears in a front-page “news” piece with the headline “Push to Fight Child Poverty Gains Steam” (different headline in online version). In the Post, we find an op-ed by a guy named Gladden Pappin with the headline “Mitt Bats for Families” (again, different headline in online version).

Here’s the intro from the Times:

The early weeks of the Biden administration have brought a surge of support, in the White House and across party lines in Congress, for what could be the most ambitious effort in a generation to reduce child poverty. The plans vary in duration, design and the amount they would add to the federal debt, but they share a new and central premise in the policy debate over how to help the poor: that sending monthly payments through tax credits to parents, even if they do not earn income from work, is the best way to help feed, clothe and house children from low-income families.

The Times piece notes that the congressional Joint Committee on Taxation had put a one-year price tag on “Mr. Biden’s [proposed] temporary expansion of the child tax credit” at $110 billion. But Mr. Pappin over at the Post points out that the biggest fool among all Republicans, Mitt Romney, has even bigger and better ideas. Romney is apparently pushing something he calls the “Family Security Act,” which may or may not get wrapped up into this “stimulus,” and will come to some “$250 billion in annual expenditure”:

The [Family Security Act] bill would meet and surpass President Biden’s proposed expansion of the existing child-tax credit in several ways. Romney’s plan offers parents of children age 5 and under $350 per month, declining to $250 per month between ages 6 and 17. For a family of three children under 5, that amounts to a hefty benefit of $12,600 a year.

Note that both the Romney plan and the existing Biden bill are structured in exactly the same way: “tax credits” to families, which however are fully “refundable” and payable by the government even to families who have no income and therefore no tax bills against which to apply the credit. It’s called a “tax credit,” but if you pay little or no taxes you get a check from the government.

So how exactly are these refundable tax credits supposed to “fight poverty”? It is incredible to me that the American people, and even seemingly somewhat “smart” people like Romney, can be so easy to bamboozle. The missing piece here is that our official measure of poverty turns on what is called “pre-tax cash income.” Refundable tax credits, no matter how large, are “post-tax,” and therefore simply are not counted.

I have covered this subject multiple times, perhaps most extensively in a couple of posts in 2014 and 2015 titled “Shouldn’t We Be Getting Angry About The Poverty Scam?” and “No Subject Generates More Ignorance Than Poverty.” In the first of those posts, I caught the ridiculously ignorant Thomas Edsall of the New York Times advocating for “expanding the scope of the earned-income tax credit” as a preferred way to reduce “poverty.” In the second, it was the editors of Bloomberg who were urging the same. But there is no ambiguity about tax credits — like the EITC and the child tax credit — not being counted when poverty is measured. For those who might not trust me or the Census Bureau (“Money income does not include . . . Tax credits”) for that information, I cited a September 2014 post from left-wing site Vox with the headline “We’ve defined poverty so that a lot of ‘anti-poverty’ programs can’t cut it.” Key quote:

[T]he only income that counts [in the measure of poverty] is pre-tax, so refundable credits like the child tax credit and, most importantly, the earned income tax credit (EITC), don't figure in. So even if the EITC gave everyone in the country $100,000 a year, it wouldn't do anything to decrease poverty, under the current definition.

Since that time, the definition has not changed. And so here we are in 2021, and the forces of massive government expansion are all assembled to push for the gigantic increase in the child tax credit supposedly (in the words of the New York Times) in “the most ambitious effort in a generation to reduce child poverty,” and everybody discussing the subject seems to be sworn to total secrecy on the subject that the hundreds of billions supposedly to reduce child poverty won’t reduce the poverty one lousy iota.

Before leaving this subject, I should mention that the failure to count tax credits in the measure of poverty is only a small part of the systematic scam of grossly overstating poverty in the United States through refusing to count government handouts of many different sorts. In truth, nobody knows how much real “poverty” or “child poverty” there is in the U.S., because the government systematically excludes approximately $1.2 trillion annual dollars of government “anti-poverty” distributions from the definitions.

The Census Bureau most recently estimated 34.0 million people in poverty in the U.S. for 2019; and the Children’s Defense Fund claims that approximately 11.9 million of those were children. Assuming that the “anti-poverty” distributions went approximately pro rata on behalf of the 11.9 million children, that would mean that approximately $400 billion of the $1.2 trillion went for the children. That’s more than $30,000 for each and every child in “poverty.” The so-called “poverty threshold” for a family of four is $26,500. How is it even possible that “anti-poverty” distributions come to about four times that, and yet none of the people get lifted out of poverty?

I gave a detailed answer to that question in this post from June 2018 titled “Some Real Information On Poverty And Income Inequality.” The short version is that the scope of exclusions of distributions from the definition of “poverty” is truly breathtaking. Besides tax credits, all non-cash and in-kind benefits of every kind and description are excluded. Of 83 categories of “anti-poverty” distribution programs, it turns out that 76 are excluded when “poverty” is measured. That June 2018 post gave just a few examples from a numbered list of the 76 excluded items:

8. Public Housing, . . . 10. Low Income Home Energy Assistance Program, . . . 20. National School Lunch Program, . . . 36. Pell Grants, . . . 49. Supportive Housing For The Elderly, . . . 53. Homeless Assistance Grants, . . . 73. Emergency Food and Shelter Program, . . . 74. Legal Services Corporation. . . .

And don’t forget food stamps and Medicaid. Follow the link for the full list if you are interested.

I don’t know how many of the 11.9 million children claimed by the CDF as “in poverty” would still be there if these distributions were counted honestly. But neither does anybody else. The government won’t tell you because if they put out a real number nobody would stand for a minute for yet another $250 billion per year of additional distributions. So they pretend that the existing $1.2 trillion in annual distributions doesn’t exist, while pressing for another $250 billion that again won’t be counted. And in a couple of years, they can be back for yet more.