This comment illustrates the level of intelligence prevalent on this board.
A lot of people count on having this big bonus payment to spend/blow on ____ come April or May. I don't really get it personally, but they do. My wife was telling me how kids at her middle school talk about knowing tax time is coming, because their parents have money to spend and they can go get new shoes. There's businesses that advertise "use your tax bonus here and get this extra or in return".
Throw on top of it that it was automatic unless you had BOTH parents in a joint-file household opt out to not get it (I don't understand that at all, it just makes it more difficult for people to opt out), a lot of people don't pay attention to and ignore items such as this, come spring they're going to be shocked about it and instead of a big refund they could potentially owe back, and a lot of people are going to be angry come spring 2022. I get the idea behind it and what they were trying to do, I just think they're out-of-touch with the saving and spending habits of lower-class Americans regardless of their political leanings. Some people would rather get $300 once than $50 6 times.
Yes, those freewheeling Gangsta kids rejoicing they can get new clothes, including even shoes, because their family may not be broke as s*** after they get their tax refund. Horror upon horrors. If only those poor people knew how to manage their money and scrape by rather than buying expensive flashy sneakers for their kids. But hey, that's why they're poor in the first place, amarite?
That's not what he said. He said that people will not understand the changes that this convoluted and arcane policy actually brings. I tried to make a similar point in another thread about this and similar comments were made towards me. To be fair, I was being much more antagonistic than I usually am, but I feel that my point still stands, which is that arbitrary direct deposits of money to people regardless of need is not going to be anywhere near as popular as Democrats think it will for a couple of reasons.
The first issue is that due to both ignorance of the policy itself and resentments that run deeper than people realize, a lot of people both with children and without are only going to see that people who need this money less than they do are getting monthly payments of what appears to be "free money". Again, I never got an answer for this, but monthly payments exacerbates an existing problem with child tax credits which is that it isn't necessarily targeted towards people in need. Karen in the suburbs will potentially get more money than a single mom of one, even though the former potentially has a household income of over 100k. At tax time, this phenomenon is noticed far less because everyone is getting their refund at once. As others have (rightly) pointed out to me, this isn't a welfare program, but the problem is that Biden and the Democrats are presenting it as such, and that discrepancy will probably bother people. Pretty much. I'm getting $300 monthly payments for the next 6 months. If it was need-based, I would be getting much less of a child tax credit, however changing that would be a vote-loser come election time. Having kids I went from modest refund to huge refund every year, and my withholdings for dependents are correct.
The second big problem, which is what StateBoiler brought up, is that liberals and progressives are out of touch with how people actually save and spend money in this country. People rely on their annual tax refund, which they now may not get, and they often spend it on items that are nonessential but still nice to have. (I don't want to speak for him, so I'll emphasize that what I'm about to say is simply my perspective, not anyone else's.) To put it simply, when people receive money they don't need––emphasis on need––they tend to spend it on stuff they want rather than need, which is unsurprising. This isn't a judgement at all, as it's important to improve one's quality of life in any way you can, but it's not realistic to pretend that everyone getting these deposits will put it all towards rent. The most destitute people will probably buy food, rent, and make car or medical bill payments with it, but the people who are able to meet their needs without the tax credit will likely use it for nonessential items, and this will be more obvious the higher the income goes. Working class people may spend the money on new shoes or home appliances, but the suburbanites will be more likely to put this towards new cars and vacations so, to put it bluntly, it doesn't surprise me that a plurality of voters don't want their tax dollars paying for that.
I'm not an expert on tax policy and I'm sure I'm missing some of the nuances of this policy, so please correct me where I'm wrong, but in terms of how this will be perceived by the public, I think there are many completely fair reasons for voters to be skeptical or opposed to this.
Pretty much this. A tax refund is a waste frankly. It's a big lump sum of money that is delayed in receipt and pays zero in return versus receiving it incrementally throughout the year. Yet, and why people love them so much, is whatever people receive net every week, 2 weeks, monthly, etc., they learn to live on. The annual tax refund is a "bonus" they live beyond what they spend regularly. My refunds I just put in the bank account, I never earmark for them anything, but I'm a minority. I know people in well-off circumstances that use the refund as a bonus to get something extra. This frame of mind, I'm from Eastern N.C., this is no different than how the commercial fishermen worked. Boat comes in to shore, they get paid, and they spend spend spend. In the days before it starts to leave again, they've used all their last paycheck and it's pretty lean.
Considering both parties in government operate under "if it's not broke, don't fix it", I'm curious what the bureaucrats' unspoken motive was. They could've done it in reverse of leave the system the same but you could file to receive advance payments in lieu of a big tax refund. They instead applied the change to everyone and you had to file to not get advanced payments, knowing most people wouldn't. I guess there's some cost savings there that only some government actuaries fully understand.
