Many 1990s policies were grounded in harmful, erroneous ideas such as financial struggles are due to personal shortcomings and less government is better. Lawmakers didn’t apply these ideas consistently, however. For example, there was no drive to reduce corporate welfare even as policymakers slashed the safety net and disinvested in lower-income communities. So, it’s not surprising that a bipartisan group of lawmakers concluded during that era that the CTC was an appropriate vehicle to give higher-income households a tax break while leaving out poor children.
The $1.9 trillion economic recovery plan, known as the American Rescue Plan, announced by President-elect Biden contains, among other provisions, expanded cash payments and changes to the Child Tax Credit (CTC) and the Earned Income Tax Credit (EITC).