The new child tax credit could lift more than 5 million kids out of poverty.


Moriah Balingit

The $1.9 trillion coronavirus aid package includes a one-year expansion of the child tax credit, which experts predict will cut child poverty in half. Elizabeth Elias and Jose Espinoza, seen at home with their children in California’s Central Valley, received $1,000 from Save the Children during the pandemic as their bills piled up. The initiative offers a preview of the expanded child tax credit’s impact. (Melina Mara/The Washington Post)

Until two years ago, Alexa’s father, Jose, was one of the more than 200,000 people who worked in agriculture in a region that produces 40 percent of the fruits and nuts consumed in the United States. Then he had a stroke. The man who once provided for the family — Alexa’s mother and four siblings — now struggles to keep his balance. Alexa or her mother, Nancy, must watch over him in case he falls. Even though her school reopened, the high school sophomore had to stay at home — taking classes on a laptop from the one-room trailer her family shares — so she could watch her dad and younger siblings.

“I used to always be concentrated at school, do all my work,” Alexa said. “After [his stroke], I was still trying to concentrate. But it was a little bit more difficult because I had that at the back of my mind.”

Educators and policymakers have spent decades — and billions of dollars — trying to figure out how to make it easier for students like Alexa, bright young people who face a cascade of challenges linked to poverty, to succeed in school. Almost nothing has stuck. Students growing up in poverty are already lagging behind their classmates by the time they set foot in kindergarten — and the disparities only worsen over time.

But the $1.9 trillion American Rescue Plan, passed in March, will test a new proposition: What does it mean for children when their families receive enough cash benefits to lift them out of poverty? The plan includes a $100 billion expansion of the child tax credit program, which will infuse family budgets with up to $1,600 more per child, and will allow even the lowest-income families to benefit. Under the previous child tax credit, families got up to $2,000 off their tax bills per child, but many poor families got a smaller benefit — or nothing at all.

Now, even the poorest families who do not make enough to pay income taxes will qualify. Families with citizen children will now get $3,000 per child and $3,600 for children under the age of 6. Crucially, the benefit will be split up and paid out in monthly increments, with the money set to go out to families via checks, debit cards, or direct deposits beginning Thursday, the Biden administration announced. For some families, the money could be transformative. The colossal and historic investment is expected to cut child poverty in half, according to an analysis from Columbia University’s Center on Poverty and Social Policy.

Sen. Michael F. Bennet (D-Colo.), who has been pushing Congress to expand the child tax credit since 2015, served as the superintendent of Denver Public Schools immediately before he took office in 2009. During his four-year tenure leading the district, he worked hard to boost achievement among low-income students, believing there was no excuse for children in poverty not to succeed. But even as he saw some successes among high-poverty schools, his views started to change.

“One of the things that I came away from the experience in the school district believing was that the schools wouldn’t be able to solve all these issues on their own,” Bennet said in an interview in April. “We had to find ways of creating greater economic mobility for families and for kids.”

He cited a 2011 study by the National Bureau of Economic Research that found that increasing tax credits could boost test scores. “These findings suggest that there are substantial returns to public policies that help poor families with children,” wrote economists Raj Chetty and John N. Friedman, then of Harvard University, and Jonah Rockoff of Columbia University.

They went further, estimating that the boost in academic achievement could reap gains over a child’s lifetime, increasing the likelihood they would graduate and attend college, and boosting their earnings. That theory will be tested in places like Poplar-Cotton Center, a farming community located in the heart of California’s Central Valley, an agricultural powerhouse that occupies a wide swath in the state’s interior. At least a third of children here live below the federal poverty line, and at Pleasant View Elementary, where Alexa attended through eighth grade, 90 percent of students are considered economically disadvantaged.

Mark Odsather, a college basketball player who grew up in wealthy Bellevue, Wash., arrived at this school more than two decades after following his wife to nearby Porterville, where she has family. He began his teaching career there and eventually rose to become the superintendent of the Pleasant View Elementary School District, where, at 6-foot-7, he is a conspicuous presence. Students at the school score poorly on standardized tests. But Odsather said they are first focused on meeting basic material and psychological needs.

“I want high academic expectations for my kids, there’s no question. But we have so many other needs that we need to address for our kids,” Odsather said.

Odsather has shaped the school around ensuring students build a relationship with at least one staff member. So classrooms are divided by movable walls, allowing students to combine for some lessons, and for students to interact with different teachers. He also hired a school psychologist whose main responsibility is providing counseling, a rare arrangement for a school of 420 students. (On average, school systems employ one psychologist for every 1,200 kids.)

Yesenia Ontiveros, the daughter of two agricultural workers who grew up in the region, is the woman he hired for the job. Ontiveros knows firsthand how poverty can make learning difficult. Her parents were teenagers when she was born, and they lived in a cramped home where her bedroom was just a closet, struggling to make ends meet while picking grapes in Delano.

Then they caught a break: Her father taught himself how to code and landed a job with nearby Kern County, and the family relocated to Bakersfield. Everything changed. Her mother, relieved of the stress of surviving day-to-day, helped her study. Her father began laying out plans for her: She would graduate high school, and then get her college degree, and then work for at least five years. And then, and only then, could she start dating. Ontiveros said the financial stability allowed her parents to imagine a different kind of life for their daughter, one where she would not be confined to low-wage work.

“Our access just opened up to things,” Ontiveros said. She transferred to a new school system and was accepted into a special math and science program in high school. “Before that, they were just so focused on surviving.”

The nation’s education system has long fallen far short of its aspiration to be the “great equalizer,” where any child, rich or poor, could have an equal shot at success. Instead, research has shown that household income is one of the strongest factors shaping a child’s academic path. The pandemic has made this difficult to ignore, with schools struggling to serve students who did not have food, Internet, or a quiet place to learn at home.

“We know that that creates a toxic situation for children as they see their parents struggling to make ends meet, struggling to pay bills, struggling to keep the lights on or a roof over their head,” said Betsy Zorio, vice president of U.S. programs and advocacy at Save the Children. “All of that has a real impact on a child's ability to focus in school and to be able to take in the information is being presented to them.”

Her organization saw the desperation of its families as the pandemic wore on, deficits that could not be alleviated by after-school programs or budgeting classes. So it started a cash transfer program for the families working with the organization in California and Kentucky, giving cash gift cards of $1,000 to families enrolled in its early childhood programs, and $600 for families who sent their children to the organization’s summer program. The organization gave 128 families in California gift cards, handing them out over last summer and fall. The cash transfer program from Save the Children offers a glimpse into how an unexpected financial boost can help families living paycheck to paycheck.

Save the Children is hardly the first organization to use cash grants to fight poverty. Several cities in the United States, spurred by the pandemic, are now experimenting with paying low-income residents a “universal basic income,” and some, including the Central Valley city of Stockton, have seen positive results.

In Poplar, freed from restrictions — the only prohibitions were purchasing alcohol, tobacco, and firearms — families used the Save the Children funds to pay phone and power bills, fix a faulty stove, and purchase groceries that had been out of reach, such as meat. One mother went to Costco so she could reap the savings of buying food in bulk. And yet another allowed each of her children to pick out a small toy, a reward for enduring the chaos and turmoil of the pandemic.

For Elizabeth Elias, a mother of four in Poplar, the money could not have come at a better time. The pandemic meant her husband, who prunes trees in the Central Valley’s vast fruit orchards, had his hours cut. Meanwhile, bills were piling up. Her four children, ages 1 to 6, needed new shoes, and she was worried she would fall behind on rent. She receives food stamps and benefits through the Special Supplemental Nutrition Program for Women, Infants, and Children — better known as WIC — but nothing that could help them pay the bills when her husband lost his job.

The $1,000 provided respite — not just from financial turmoil, but from the stress that came with her husband’s sporadic income, and a rapidly thinning savings account.

“Gracias a Dios,” Elias said in March, sitting in the living room of the home she rents, the walls painted in vibrant purple and plastered with photos of her children. Out in the front yard, bordered by a chain-link fence, the family displayed a yard sign announcing that their eldest, Geraldo, had earned a citizenship award.

Elias came to the United States as a teenager, landing in another small community in Tulare County. She enrolled in English and child development classes at a local community college but was quickly overwhelmed. Learning and writing in English was too difficult, as was balancing classwork with a daytime job in the fields.

Children from impoverished households are already behind their more affluent classmates by the time they enter kindergarten, and the disparities persist through school. Students living in poverty are twice as likely to repeat a grade, and 10 times as likely to drop out of high school, researchers found a decade ago, a sequence of events that makes it difficult for them to escape it. Household income is indelibly imprinted on test scores: On the SAT, students from households that made less than $20,000 scored, on average, 400 points less than did students growing up in homes where earnings exceeded $100,000, according to 2014 data. All of this, too, is compounded by the fact that schools in poor communities are often underfunded.

Now, Bennet and others are watching closely to see what happens if the expanded child tax credit is made permanent. What will it mean for schools that