Commentary: The GOP Can Reclaim the Child Tax Credit – And Use it to Win in 2022

family of three eating pizza
by Mike Shields


As part of his Contract with America, House Speaker (and my former boss) Newt Gingrich helped first introduce the Child Tax Credit (CTC), passing it in 1997. Originally the idea of President Ronald Reagan, the CTC was founded on the conservative principles that raising children is God’s work, and parents should not be punished or held back for choosing family in a country that is always moving forward. President Trump continued this tradition by doubling the CTC in 2017. As Speaker Gingrich said during a 1995 speech, “We believe that parents ought to have the first claim on money to take care of their children rather than bureaucrats.”

Democrats reformed the CTC in 2021, as part of their wildly overdone American Rescue Plan. They’ve sought to continue their changes to the CTC in the even-more-overdone Build Back Better Act (BBB), a hulking Frankenstein of bad Democratic ideas. But the new version of the CTC may be an exception. It continues fulfilling Speaker Gingrich’s contract, empowering families to work and earn, and to raise their children with their own values. The spirit and core of that policy is even better reflected by flat, poverty-busting monthly disbursement of the credit. It’s the only salvageable ship in the sinking BBB fleet.

The CTC – in its 2021 form – does not stray too far from the $500-per-child tax cut that was initially passed in 1997. The payments, which provided eligible families with up to $300 per month for each qualifying child under age 6 and up to $250 per month for each qualifying child aged 6 to 17, stimulated regional economies, protected families from rising costs, provided direct cash relief, and removed bureaucratic hurdles.

Family values and the economy will always be winning issues for Republicans. Americans still have more faith in the Republican Party to keep America prosperous and protect them from Democratic mismanagement, and we should always pursue policies that strengthen America from within our families first. Stronger families make for stronger communities, and in turn, a stronger country.

Study after study has shown how the CTC can make a tremendous local economic impact. A report by Moody’s Analytics found that the CTC was projected to generate over $18.6 billion in economic activity in local economies against a cost of just $14.9 billion per month (it will take time to measure how accurate this prediction was). It is also a job creator, projected to support over 500,000 private sector jobs over a 12-month period.

The CTC represents the disciplined, responsible kind of tax cut that Republicans should champion, because the cost of the program is offset by the economic growth it spurs, with a clear return on investment. It protects families from the economic devastation wrought by other disastrous Democratic policies. Republicans are already accustomed to making these arguments. Another recent study notes that the CTC will generate over $1.9 billion in additional revenue for states, reducing deficits without raising taxes. And while helping grow our economy, the CTC is also empowering families to escape child poverty and food insecurity through their own autonomy.

Working families want to succeed, and they don’t want to be mired in paperwork. By giving a modest tax credit directly to families, the CTC also sidesteps wasteful bureaucracy championed by liberal Democrats and resented by the voters who, nonetheless, wrongfully think only Democrats want to help them. These kinds of assistance programs often shut off as soon as a working mom gets a small raise, for instance, disincentivizing work. By letting BBB die, then resurrecting the CTC, Republicans can reclaim the mantle of family politics. They’ll continue their surge among working class voters and especially communities of color, by championing a pro-freedom policy that rewards work and does not engender dependency, while solidifying gains in suburbs by standing against the wasteful bureaucracy of the BBB.

The CTC is a win-win policy solution that fiscal conservatives have historically supported and promoted. The GOP must remind the public that we conceived and first introduced the CTC, and brand its new construct as a better alternative to costly and ineffective welfare programs that spur runaway costs and inflation. This common-sense solution has already made a dramatic impact on the lives of many hard-working families, Republicans and Democrats alike. Some may resist embracing changes to legislation that most recently was proposed by Democrats, but after killing BBB, GOP support of a monthly CTC could give the party an effective message heading into 2022 about what impact their majorities would have on the daily lives of Americans. As Margaret Thatcher once said, “first win the argument, then win the vote.” The fact that Democrats included a tax cut that we invented in their bill is proof that we won the intellectual argument — let’s take it to the people and use it to win the vote for ourselves.

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Mike Shields is the founder of Convergence Media. He was formerly chief of staff for the Republican National Committee.

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