President Joe Biden’s American Rescue Plan is shaping up to be far more than a COVID-19 recovery plan. It’s a flat out reimagining of the War on Poverty, shining a light on inequality that we haven’t seen since LBJ. For example, the minimum wage increase Biden and Democrats are intent on passing with the bill could lift hundreds of thousands of people out of poverty. That’s not just pandemic relief, that’s permanent hand up and out of poverty.
So is the sleeper provision in the plan, now included in legislation for a year’s worth of monthly cash payments to parents of minor children, $3,600 annually per child under 6, $3,000 for children up to age 17. In the pandemic relief scenario, that assistance will start in July and go for a year, but Democrats are already drawing up plans to make it permanent. It’s an “incredibly smart” plan politically, as Markos Moulitsas wrote here. But it’s also very economically and—as importantly—morally sound, the “seemingly radical notion that children should not grow up in poverty.”
“The simple truth is, if we make these investments now, with interest rates at historic lows, we’ll generate more growth, higher incomes, a stronger economy and our nation’s finances will be in a stronger position as well,” Biden said while explaining his plan Friday. Advocates for families agree. “This is a really bold idea,” C. Nicole Mason, CEO of the liberal Institute for Women’s Policy Research, told AP. “Things that we wouldn’t have been talking about as possible a year before the pandemic are suddenly on the table—and this is one of those things.” Daniel Hemel, a law professor at the University of Chicago, says the “Democratic plan would likely mark the most significant step in the fight against child poverty since LBJ’s Great Society.”
That depends in part on whether Democrats can make the support permanent. That’s not been lost on supporters. “A one-year improvement is great, and it puts the architecture in place,” said Michelle Dallafior, senior vice president for the advocacy group First Focus on Children. “But we need to keep doing more and build something permanent … No child should live in poverty.”
Half of the children living in poverty in 2021 could be lifted out of it with this plan this year. That’s not just because of the child credit cash payments, but along with boosted unemployment insurance, enhanced Supplemental Nutrition Assistance Program benefits, and survival checks. That would mean just this year, 5 million children—and their families—could be lifted out of poverty. Making the plan permanent coupled with a minimum wage increase could lift every child out of poverty.
That’s ambitious. It’s also aggressive. Biden and Democratic lawmakers are not shying away from using the means they consider necessary to get this done. They are inviting Republicans to join them for the good of the nation, but are prepared to do it without them. That’s what this moment demands. Frankly, it’s what the last several decades of growing income inequality has demanded. Seizing this crisis to meet that demand could put Biden in the ranks of LBJ and FDR.