Another reason for Child Tax Credit expansion? Smarter babies.
If you are looking for even more evidence that extending the expanded Child Tax Credit is good public policy, consider this: a breakthrough new study suggests that such payments can make babies smarter.
The study, released this week by the National Academy of Sciences, did not involve the CTC payments. However, it did examine low-income families who received just over $300 in monthly cash assistance during the first year of their children’s lives. It found that infants in families receiving the payments displayed more high-frequency brain waves when they reached 12 months of age; these brain waves are associated with higher language and cognitive scores and better social and emotional skills in children as they grow older.
“This study demonstrates the causal impact of a poverty reduction intervention on early childhood brain activity,” write the study’s authors. “Data…show that a predictable, monthly unconditional cash transfer given to low-income families may have a causal impact on infant brain activity. In the context of greater economic resources, children’s experiences changed, and their brain activity adapted to those experiences. The resultant brain activity patterns have been shown to be associated with the development of subsequent cognitive skills.”
The study drew the notice of Danito Trisi, Director of Poverty and Inequality Research for the Center on Budget and Policy Priorities. Trisi blogged on it this week.
“The expanded Child Tax Credit, which Congress enacted in 2021 and which expired last month, provided support very much like the cash assistance described in the new paper,” Trisi wrote. “The paper is a pathbreaking combination of social science and neuroscience, is methodologically rigorous, and adds heft to the substantial evidence about the difference that extending the Child Tax Credit expansion would make in children’s lives. These findings underscore why it is important that policymakers extend the expansion as part of any final agreement on Build Back Better legislation.”
Trisi writes that a number of studies have found that when low-income parents receive income support, their children grow up healthier and perform better in school, which in turn enhances their potential future success in the labor market.
And he cites a September 2021 letter to congressional leaders signed by more than 400 economists who argued that expanding the CTC permanently “would improve children’s lives in important and lasting ways.”
“Expanding the CTC would dramatically reduce childhood poverty in the United States,” the economists wrote. “Research shows that reducing child poverty improves educational attainment, as reflected in fewer school absences, higher standardized test scores, and more high school completion and college attainment. It also improves health in infancy, during childhood, and in adulthood, as well as reducing mortality and crime. The financial gains from reducing childhood poverty have been found to persist long past childhood: low-income children who benefit from safety net programs are more likely to be employed, earn more as adults and less likely to be poor.”
Trisi concludes that the debate over CTC expansion too often has failed to focus on just how much CTC benefits help infants – and he refers back to the study released this week by the National Academy of Sciences.
“Now these early neuro-imaging results provide powerful new evidence of what so many other studies have found – a more secure and adequate family income alters children’s lives in concrete ways and expands their opportunities to succeed and thrive,” he writes. “That alone makes expanding the credit an important step for families, communities, and the nation as a whole.”