Clinton’s no-tax pledge is Republican “starve the beast” policy infused with Third Way politics

[FreakinDJ]

It’s ridiculous because Clinton’s pledge boxes her into policy corners that leave her with no choice but to use creative and regressive tweaks on otherwise good ideas in order to keep her price tags down. Take, for example, her proposed tax credit for caregivers. Clinton’s policy would provide a tax credit of up to $6,000 for families that are taking care of an elderly family member. However, the only way to keep the budgetary costs of such a program down — $1 billion per year, by all available estimates — is by making the credit non-refundable (you can only claim it against existing tax liability, as opposed to a refundable credit, which allows you to have negative liability). Making the credit non-refundable may make it less expensive, but it also makes it useless. As Demos analyst Matt Bruenig explained:




The basic problem with having a nonrefundable caregiving credit is that you can only claim the credit if your family’s income is sufficiently high. This means that poor and working class families will be prevented from claiming the credit: their tax liability simply isn’t high enough to grab much, if any, of the $6,000 credit. This is the basic problem with all nonrefundable credits, including Marco Rubio’s child tax credit, which also would miss the poor and working class.

The less basic problem with having such a credit is that it’s nonresponsive to the fact that missing work to care for elderly relatives makes your income lower. When done well, caregiving assistance benefits are specifically designed to help families who have seen their labor market earnings collapse because one of the families’ workers has had to leave the labor force to care for a loved one. A nonrefundable credit does not do that because having your labor market earnings collapse causes you to be ineligible for the benefit. Specifically, becoming a caregiver makes your family’s income much lower and because your family’s income is much lower, you are much less likely to have enough tax liability to claim the nonrefundable caregiving credit.

The only families that could reliably claim this kind of caregiving credit are those whose incomes are so high that, even when one of their workers drops out of the labor force to be a caregiver, they still have a high enough income to claim the credit. Thus, a nonrefundable caregiving credit is even more rigged to favor high-earning families than normal nonrefundable tax credits are.


http://americablog.com/2015/12/hillary-clinton-no-tax-pledge-republican-policy-third-way-politics.html

[djean111]

1. Thanks for this. And no surprise that it does not benefit poor people.

No surprise at all.

[Recursion]

2. I thought O'Malley's caregiver plan was awesome

Up to five years of child or elder care would be treated by SSA and Medicare as having been years worked at the worker's average career wage. I really wish one of the other two would pick that up.

[delrem]

3. A political party should have some mechanism for debating these issues outside primary/GE process.

So the party has a basic platform agreed on by the majority and that a party whip can enforce when it comes time to govern and the representatives to vote, and where the voters who chose that party have some assurance that they're not buying into a Schrodinger's cat of a deal.

The primary/GE process is focused on individual personalities and seems tailored to the idea that one person, a King/Queen/God/Goddess should have all the answers to all the questions immediately at hand, and selectively dole out dribs and drabs of their individual "platform" for the adoring but clueless masses. So based on insubstantial promises and sound bytes delivered with Madison Ave techniques, people vote for candidate X to be nominee and that's the end of it. If candidate X goes on to win the GE, whether X also goes on to implement any of the flash promises of the campaign is up to a coin flip, or worse, moneyed lobbyists who do have a mechanism to propel their ideas 24/7/52 year in and year out. Who do have a mechanism for getting their top players cabinet posts and entrenched in back room power positions.

[daleanime]

10. +1

[Cobalt Violet]

4. she hates poor people.

Never missing a chance to fuck us up as much as she can.

[Vinca]

5. I'm afraid a whole lot of Hillary's persona is smoke and mirrors.

And people lap it up. It's very strange and it's going to be a whole lot stranger when Trump is the president and gets to name 4 Supreme Court justices. Cape Breton Island, here we come.

[SammyWinstonJack]

13. Was that a real offer from Cape Breton? Because if so and Trump, I'm so going there.

[Vinca]

17. I hope it's real.

[Hoppy]

6. Why doesn't she just sign Grover Norquist's "No New Tax" pledge.

[FreakinDJ]

7. Basicly she is

[Ed Suspicious]

8. Socially liberal so long as it doesn't interfere with their economic conservatism.

The Clintons are compassionate conservatives. Full stop.

[daleanime]

11. Exactly.....

[SammyWinstonJack]

14. Where's the compassion?

[tk2kewl]

9. corporate hegemony

Shut up and accept your financial subjugation

[freebrew]

12. Ummm, isn't she running for the DEMOCRATIC nomination?

WTF is this? More republicanism from the RW side of the party?

WHY, HOW can any democrat support this SHIT?
Who the hell decided this was to be the DEM platform?


Where's the Hillarians on this?

crickets?

[Zorro]

15. So let's talk about the tax credit

I find the text "Making the credit non-refundable may make it less expensive, but it also makes it useless..." and "The only families that could reliably claim this kind of caregiving credit are those whose incomes are so high..." to be a bit of hyperbole.

If one has a taxable income in the range of ~$40K-$45K, the tax obligation is in the $6K range. So a person in that income range (or less) would effectively end up paying little, if any, federal taxes. That is not useless, nor is it a "so high" income.

[FreakinDJ]

16. If a family has 40K income and 1 member stops working

Then the remaining income is so low they don't have enough available tax burden to receive any advantage from claiming the credit

Simple enough to understand

Given 2 income families all the way up to 149K are already taking advantage of home interest and child care deductions l fully understand how someone below the 100K bracket would NOT be able to benefit from her plan

[amborin]

18. K&R