If you are a US citizen, and you have children, and you file your taxes electronically, you may find some free money in your bank account today. If you don’t file electronically, and you have children, you may get a check mailed to you in the coming days from the IRS.
Well, free money is always good, but as usual, and to with all due respect to Hugh Nibley, there really is no free lunch.
But first, the details:
This is a result of some of the federal stimulus plans that were approved earlier this year. There will be monthly checks disbursed on the 15th every month in 2021. Ninety percent of kids and their families will benefit from the newly expanded CTC credit. Middle-class families and families working to join the middle class are all eligible to receive the full credit of $3,600 per child under age 6, and up to $3,000 per child ages 6 through 17. Families will receive up to $250 a month for each child, and $300 a month for every child under 6.
To be clear, I am against all taxes in principle. Poverty should be handled by churches and other charitable institutions, and taxes should be eliminated until we get as close to zero taxes as possible. But of course this is a chimera in our days of ever-expanding government, where citizens increasingly look to bureaucrats and politicians for “free” checks.
If we are going to be forced to pay taxes, I am in favor of child tax credits. A permanent expansion of tax credits aimed at children encourages more children, which is overwhelmingly a good thing.
It should be clear, however, that there is no such thing as free money from the government. The yearly deficits are in the trillions now, which means the Federal Reserve has to create the money from thin air to pay the deficits. New money creation is the literal definition of inflation. (ie, “inflating the money supply”). The increasing deficits are the primary reason prices are going through the roof in the United States.
So, you might get a few hundred dollars a month (maybe more for many latter-day Saint families, which is awesome) for the rest of the year, but that money will be eaten up by higher prices over time.
If you are a young family without your own home, this means housing prices will continue to get higher and higher, making a purchase increasingly unattainable. This means gas prices will continue to go up, and food prices, and new and used car prices, etc.
So, the real solution is a balanced budget, lower taxes, less government and more self-reliance. The real solution would be that if you make $70k a year you get to keep $70k a year (minus voluntary tithing of course to help the truly needy). But we are so far from that possibility that it is difficult to even imagine what that world would look like.
So, enjoy your “free money.” While you can.