Stimulus bill’s historic benefits may answer a big question for Democrats

By Snations Reporter On Mar 16, 2021

“It ranks historically right up there next to the Social Security Act,” says Garfinkel. “And in terms of children, maybe even bigger than the Social Security Act in the actual short-term outcomes.”

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That means those directly benefiting from the law will include millions of the working-class White families who have become the bedrock of the Republican electoral coalition; just considering the expanded child tax credit, one recent study by the Center on Budget and Policy Priorities, a liberal policy analysis and advocacy group, found that White kids will compose about half of the roughly 65 million beneficiaries nationwide, and a clear majority of those receiving the enhanced benefits in key Rust Belt states such as Michigan, Pennsylvania, Wisconsin, Ohio and Iowa.

The vast scale of this material assistance to financially strained families of all races will test whether any conceivable set of government economic benefits can loosen the GOP’s hold on working-class Whites — or the modest but measurable gains that Trump recorded in the 2020 race among working-class Hispanics and even some Black voters (especially men in each case).

Working class White voters — usually defined as Whites without four-year college degrees — were the cornerstone of the “New Deal” coalition assembled by Roosevelt, which dominated American politics from 1932 through 1968. But since the mid-1960s, the defection of those blue-collar White voters — heavily concentrated among Catholics in Northern states, evangelical Protestants in Southern states and rural residents in both regions — to the GOP has been a constant source of frustration and anxiety for Democrats.

In Election Day exit polls conducted by a consortium of media organizations going back to 1980, no Democratic presidential candidate has carried most of those non-college White voters except for President Bill Clinton in 1996, who won a razor-thin 44% plurality of them in a three-way contest that included independent candidate Ross Perot. The 2016 exit polls conducted by Edison Research for a consortium that included CNN showed Trump crushing Hillary Clinton among them by 66% to 29% — the strongest showing with those voters for any candidate in either party since Ronald Reagan in 1984. Other post-election studies of the 2016 vote showed comparable deficits for the Democrats.

In the 2020 election, Biden — an older White Catholic who projected a culturally compatible “Scranton Joe,” working-class image — recovered only modestly with these blue-collar White voters: The exit polls showed Trump still beating him with them by 67% to 32%. (The VoteCast analysis from The Associated Press and the National Opinion Research Center gave Trump only a slightly narrower 30-point advantage.)

The exit polls did show Biden recording bigger gains in the critical states of Wisconsin and Michigan — where he won about two-fifths of these voters, compared with about one-third for Hillary Clinton. But Biden remained mired at about one-third support among them in Pennsylvania and Ohio, and Democrats’ failure to win more of these voters was a critical factor in their Senate defeats in states including Maine, Iowa and North Carolina.

Appeals to blue-collar Whites

For decades, many Democratic strategists have argued that a key to regaining support among White working-class voters is to deliver them material economic assistance as a means of dispelling the widespread belief among them that government cares mostly about the poor (a view spiked with racial animosities linked to stereotypes such as “the welfare queen”). The conviction that Democrats needed to demonstrate such concern about working- and middle-class families, for instance, helped drive the mammoth political struggles by Bill Clinton and President Barack Obama to expand access to health insurance.

But neither effort fulfilled that political aim (though Obama, succeeding where Clinton failed, passed his Affordable Care Act into law). In each case, polls showed that Republicans persuaded many White voters to view the Democrats’ health care proposals as a kind of welfare program that imposed new obligations on them while mostly benefiting poor people. White voters then keyed enormous gains for the GOP in the midterm elections immediately after the congressional struggles over Clinton’s and Obama’s health care plans, with those without college degrees leading the stampede away from Democrats each time.

With every congressional Republican opposing the new stimulus plan, some in the GOP have already signaled their intent to reprise these arguments. Sens. Mike Lee of Utah and Marco Rubio of Florida, for instance, have portrayed the expanded child tax credit — which will provide $3,600 annually per child younger than 6 and $3,000 for those aged 6-17, regardless of whether the parent is working — as a handout that reverses the welfare revisions of the 1990s.

Here's what you need to know about the new stimulus child tax credit

“That is not tax relief for working parents; it is welfare assistance,” the two insisted in a joint statement last month. “An essential part of being pro-family is being pro-work. Congress should expand the Child Tax Credit without undercutting the responsibility of parents to work to provide for their families.”

But the breadth of the stimulus bill’s assistance will complicate those efforts. It makes the child tax credit available at that full amount to married couples earning up to $150,000 annually, a huge swath of American families. The Center on Budget and Policy Priorities calculates that 90% of American children will receive at least some increased assistance from the law.

Just by itself, the group calculates, the new law will reduce the number of children in poverty by 4.1 million; by comparison, the combined effect of the existing child tax credit and the Earned Income Tax Credit for low-income working families, policies that have been in place for decades, reduces the number of poor kids by about 5.5 million, notes Chuck Marr, the group’s senior director of federal tax policy. “In one law, one fell swoop, you are doing the equivalent of decades worth of policy gain,” Marr told me.

In figures provided exclusively to CNN, the Institute on Taxation and Economic Policy, which generally advocates for a more progressive tax code, similarly calculated that households headed by Whites will make up 67% of those receiving the bill’s direct cash payments, 64% of those benefiting from its expanded child tax credit and 62% benefiting from its enhancements to the Earned Income Tax Credit.

Families in the middle of the income distribution (two-thirds of whom are White) will see their income rise by nearly 7% as a result of the bill, while families with children in that income bracket will receive even more assistance, the group calculates. A married couple earning about $40,000 annually with one child at home, the group projects, could see their income rise by nearly $6,000, a 15% increase.

And even this doesn’t exhaust the bill’s potential benefits for middle-income and working families. It also includes substantial food and housing assistance, and above all it expands eligibility for subsidies to purchase health insurance under the ACA to more middle-income families and increases the size of the subsidies available to them. The Center on Budget and Policy Priorities calculates that a family of four earning $50,000 annually would see its premiums on the ACA marketplace plummet from $252 to $67 per month, while a family of four earning $110,000 annually would experience a reduction from $1,445 to $666 per month.

It’s different this time

Rarely, if ever, has a single piece of federal legislation provided so much direct financial assistance to so many families, particularly those in the bottom half of income distribution.

“I think this is by far the largest,” Marr says. The big caveat to that judgment is that the bill’s key provisions — particularly the child tax credit and increase in ACA subsidies — are only temporary. But, Marr adds, “if it becomes permanent … the child tax credit is a potentially landmark achievement that is up there with the ACA, with things that Lyndon Johnson did, Franklin Roosevelt did. It’s a history book achievement.”

Garfinkel at Columbia agrees. “It may be the biggest single increase that we’ve ever had,” he says, in direct government assistance to families at the median income or below. But what makes the legislation especially distinctive, he says, is that it doesn’t stop there; it spreads benefits well into the middle class.

“There is no question that the big beneficiaries are those at the bottom, but it’s also quite different from the ACA and other Democratic Party efforts that focus programs only on the poor,” he says. “We’ve limited and targeted benefits. Even the Earned Income Tax Credit is incredibly targeted at the bottom, food stamps even more so, [welfare] was even more. But the child allowance is going to be a near-universal program and in the short term people well into the middle class will benefit.”

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Not only the breadth of the bill but also the extent of the distress that prompted it could change the political equation. Virtually all Americans had their lives disrupted in some ways from the pandemic, which could make it much more difficult for Republicans to paint the stimulus plan as a response to “somebody else’s problem” — which was, in effect, the label they initially attached to the ACA and Obama’s 2009 stimulus plan.

Because even so many Republican-leaning White voters “were desperate [and] so on the edge,” amid the economic devastation of the pandemic, “I think they are going to struggle to turn it into welfare,” says Stanley B. Greenberg, a veteran Democratic pollster.

John Brabender, a longtime Republican consultant who has often directed races in heavily blue-collar states such as Pennsylvania, agrees the GOP needs to be cautious about portraying the plan as a form of welfare. “That’s a dangerous message because there’s a lot of hard-working people [benefiting from it] and the last thing they want to do is think of this as welfare,” he says.

Early polling finds that the public’s first reaction is to see the plan providing broadly shared benefits. A CBS/YouGov national surveyreleased Sunday found that more than two-thirds said the plan was likely to benefit Black and Hispanic communities, but roughly three-fifths said it would benefit Whites, the nation’s economy overall, rural areas and, most important, people like them.

Though Whites without college degrees are usually the principal audience for Republican efforts to portray Democratic initiatives as welfare, they were as likely as Hispanics (and more likely than Whites with college degrees) to agree in the survey that the plan would benefit them personally. Just as important, all of those numbers were more favorable for the plan than polling released a few days earlier by the Navigator project, a Democratic polling consortium; that suggests the plan might be growing more popular as Americans hear more about it.

“This rescue plan isn’t solving somebody else’s problem; it’s solving everyone’s problem,” says Jesse Ferguson, a longtime Democratic consultant who advises the Navigator project. “People are not going to view this as a zero-sum policy solution where somebody else is benefiting and they are losing. Instead, they view this as a rescue from a pandemic where everyone was losing.”

Largely agreeing, Brabender suggests Republicans focus less on attacking the stimulus plan head-on than on trying to shift the subject to issues where more GOP-leaning voters — particularly those blue-collar Whites — distrust Democratic priorities. That instinct was evident during the stimulus debate, when Republican House leaders such as Kevin McCarthy of California and Liz Cheney of Wyoming made only token efforts to discredit the bill and instead pivoted to condemning alleged censorship of Dr. Seuss and the growing number of unaccompanied minors arriving at the US border.

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Brabender says the flow of liberal priorities rapidly passing through the House — on issues from gun control to police and election revisions to LGBTQ equality — will provide Republicans plenty of targets next year to win back culturally conservative voters, even those who might welcome help from the stimulus bill. Democrats, Brabender says, “don’t realize” how much trouble they will have with some of these congressional votes, particularly in districts or states with large numbers of blue-collar voters. “What seems like a safe vote at the moment may not be as safe as they think it is,” he says.

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That could produce a 2022 election season organized around familiar coordinates, with Democrats portraying themselves as defending working- and middle-class families’ economic interests while Republicans target their cultural values (and, in the case of White families, their sense of racial identity).

While advancing an aggressive agenda on social and racial issues, Democrats may try to keep the focus, as much as possible, on their direct economic assistance to working families. It’s virtually certain that Democrats, before the 2022 elections, will seek to make permanent at least the expansion of the child tax credit and the ACA subsidies.

And in that process, Greenberg notes, Democrats will likely create another sharp contrast by proposing to pay for those benefits partly through repealing elements of the Trump/GOP tax cut that benefited corporations and top earners — an argument that may appeal precisely to the blue-collar White voters drawn to Republicans on racial and cultural grounds.

“These voters are strongly for raising taxes on the rich; Republicans will fight it,” says Greenberg, whose wife, Democratic Rep. Rosa DeLauro of Connecticut, was a principal sponsor of the child tax credit. “That’s another part of the battle for the midterm. Biden doesn’t have a populist side, but he will on taxes. Having cut [working class families’] taxes and having raised them on the rich, Biden is going to look like an economic populist.”

President Joe Biden signs the $1.9 trillion Covid relief bill into law in the Oval Office of the White House on Thursday, March 11, in Washington

The number of Whites without college degrees has been steadily shrinking for decades, as a share of both society and the electorate. Yet because of their large numbers in states at the tipping point of both the Electoral College and the battle for Senate control, they retain a disproportionate political influence.

With Republicans in the Trump era so explicitly voicing many of those voters’ racial and cultural anxieties, Democrats are resigned to the GOP holding a clear majority of them, even after they receive the substantial material assistance in the stimulus plan. But given the Democrats’ improving performance with college-educated White voters, and the growing presence in the electorate of the racially and religiously diverse younger millennials and Generation Z, the party would need only modest improvement with these working-class Whites to significantly fortify their electoral position.

“What matters here are small numbers,” says Greenberg.

The sweeping stimulus plan may constitute the party’s best chance in years to achieve small blue-collar gains that could have big political consequences.

www.cnn.com 2021-03-16 04:32:45