Excerpt from The Republican Welfare State (Yet Again)
By Laurence M. Vance
http://www.mises.org/story/1793"Increasing Welfare as We Know It
Since the celebrated "Republican Revolution" in 1994, the Republicans in Congress have not rolled back the welfare state one inch. And not only do they not intend on doing so, they are expanding the welfare state almost as much as they are increasing the warfare state. The talk radio mouthpieces for the Republican Party who make their living railing against the left, the liberals, and the Democrats, need to look in the mirror.
Here is a typical example of "increasing welfare as we know it"—thanks to Republican tax welfare. In the document, Facts About the Child Tax Credit: Tax Time Can Pay Even More For Working Families, published by The Center on Budget and Policy Priorities, the example is given of a typical couple, Sam and Barbara:
Sam and Barbara are married and raising four children under age 17. They earned $25,000 in 2004 and owe no income tax. Their maximum CTC is $4,000 (4 children x $1,000). Fifteen percent (15%) of their earnings over $10,750 is $2,138 ($25,000 - $10,750 = $14,250; 15 percent of $14,250 is $2,138). Since the couple has no income tax liability, none of their CTC is used—the full $4,000 remains. Since this is more than 15 percent of their earnings above $10,750, Sam and Barbara receive a CTC refund of $2,138. They also qualify for an EIC of $2,209, bringing their total refund to $4,347!
This means that Sam and Barbara's real income is in fact $29,347. But it is actually higher than that if they receive any federal, state, or local benefits like Medicaid, SSI, WIC, food stamps, subsidized housing, or emergency heating assistance. And none of these things count as income in determining eligibility for the CTC or the EITC. And neither do amounts received from the CTC or the EITC count as income in determining eligibility for any of the abovementioned types of welfare."
