The very best program for social uplift is a job. With the exception of persons dealing with severe, chronic disabilities, employment must be the central piece in any strategy to overcome poverty.
The basis for the highly successful Earned Income Tax Credit (EITC) initiative is this fundamental belief in the supreme importance of work. Here at Central Dallas Ministries we have encouraged the low-income working men and women that we know to file a tax return to secure this credit. At one point, our public interest law firm secured a grant from the Internal Revenue Service that allowed us to do this work more effectively.
As a tax strategy to reduce poverty and its ill effects on the nation, the EITC was the idea of Richard Nixon, and was signed into law by Gerald Ford in March 1975. The program has received broad bipartisan support from its inception and has been expanded over the years.
The EITC provides a tax refund to all workers in poverty, who earn less than a certain amount annually--regardless of whether they pay income taxes. The EITC is designed to move people aware from federal welfare assistance and into lives of work. Bottom line: the EITC establishes a minimum annual salary for workers. If a worker earns less than the baseline minimum, she or he receives an earned income credit that raises annual earnings to the established minimum.
Ronald Reagan referred to the EITC as "the best anti-poverty, the best pro-family, the best job creation measure to come out of Congress." He increased funding for the effort, as well as the minimum baseline several times. George H. W. Bush expanded the EITC as well.
Senator John McCain has been a consistent supporter of the EITC. Last Saturday (October 18, 2008), the Washington Post reported that, "In fact, in 1999, Mr. McCain opposed efforts to change the earned-income tax credit, which gives payments to the working poor, and called it a 'much-needed tax credit for working Americans.' And in this campaign, he has proposed to use the tax code to do more such 'wealth-spreading."
The Hoover Institute describes the EITC as: "...probably the most cost-effective anti-poverty program the federal government operates."
Using the federal tax code to incentivize work, lift families and promote economic growth is sound policy. The EITC has been supported by leaders from both major political parties. It is an effort that works, while rewarding work!
Good Friday Meditation
5 days ago