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The Real Reasons Why Poverty Plunged

What a New Study Gets Wrong About Child Poverty and the Social Safety Net

September 17, 2022

Writing the Dispatch, Scott Winship challenges a new report featured this week in the New York Times that attributes the historic decline in child poverty since the 1990s to expanded social spending. Winship contends that by focusing on income from transfers, the study ignores "the possibility that welfare reform helped poor children by encouraging parental work and marriage and could serve as a model for other programs."

 

 

Dalibor Rohac explains the strategic elements of Ukraine's surprising and inspiring turn of the tide against Russia. "One obvious reason," writes Rohac, "is Ukraine's patience and the use of deception" that misdirected Russian forces.

 

Recent legislation will make billions in federal funding available to the states to spur technological and environmental innovation, according to John P. Bailey. He outlines how states might compete for these funds.

 

In the inaugural post of AEIdeas' new "Elections and Demography" series, Ruy Teixeira, Karlyn Bowman, and Nate Moore report on polling data that show Hispanic voters' continued shift to the Republican Party.

 

As the Senate considers legislation that would expand eligibility for Supplement Security Income cash welfare payments, Mark J. Warshawsky proposes reforms to "balance costs with savings, improve fairness and incentives to work, and ease the administrative burden on the Social Security Administration."
 
Angela Rachidi presents evidence that recent increases in federal food assistance expenditures did not reduce food insecurity and identifies the unintended consequences that further expansions could bring.

Section 199A and "Tax Parity"

In his latest report, Kyle Pomerleau evaluates the effect of Section 199A, a personal income tax deduction for qualified business income created by the Tax Cuts and Jobs Act (TCJA) of 2017. Pomerleau says that Section 199A created a tax benefit for pass-through business income, which is not subject to corporate income tax, that may have compromised the tax code's neutrality toward different types of business and investment activity. Applying three measures of effective tax rates, Pomerleau finds that pass-through business income and investment face a lower effective tax rate than do other forms of business income and investment. He concludes that this disparity might distort investment and says these problems could be remedied by omitting Section 199A from any renewal of the TCJA's tax code when it expires in 2025.

 

 

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What unites us—what renders us 'we' in 'we, the people'—is our shared commitment to the principles of the Declaration of Independence and the Constitution, which recognize the profound, inherent and equal dignity of each and every member of the human family. I, and you, and all of our fellow citizens have certain responsibilities to America because we are Americans.

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