Press Release

By: AIF Staff

Washington, DC – Earlier this week, former Speaker of the House Paul Ryan delivered the closing address at a virtual conference, hosted by the Brookings Institution and the American Enterprise Institute, on the recent policy developments surrounding the Earned Income Tax Credit.

Ryan, who took questions and was introduced by Brookings’ Isabell Sawhill, shared his view on provisions in the American Rescue Plan Act that expanded younger Americans’ access to EITC, increased the size of the benefit for childless adults, and raised the income cap for those eligible for the credit.

Some notable excerpts of Speaker Ryan’s remarks, edited lightly for clarity, follow.

Long-sought EITC reforms expand economic opportunities, but pay-fors are needed

“If you ask me what is the one thing that the government does that is the most effective at fighting poverty, I would say it is the Earned Income Tax Credit. There are just no two ways about it. If I had to pick one strategy, the EITC is the most effective poverty tool we have. It achieves its intended effect and it does so without reducing labor force participation.”

“All three of those [EITC policy changes] are things that I was pushing for back when I was Budget Chairman in 2014. Sometimes it takes a while for policies to actually occur. This is one of those things that I think has long had bipartisan appeal and I’m glad that this has happened. Having said that, when we proposed these things, we always had pay-fors. We always found ways of creating physical space to pay for it. This is temporary, we’ve done these things via emergency legislation. So, I think we’re going to have a pretty good debate about whether this gets extended.

“I think it’s good policy and therefore I think it should. But I do think we have to be mindful of our fiscal situation. There are less important things that could be cut to pay for this, so I do believe we’re going to have a pretty good conversation about how to pay for the extension of these policies, when we go from emergency relief and we take into account our debt and our deficits, which are coming back with a vengeance.”

Conservative debate on EITC: Healthy, necessary, and conducive to sound policy development

“There’s a bit of debate on our side of the transom on family policy versus labor and I see this is actually a good debate. It’s the hot topic in conservative circles these days and we have a number of competing proposals, some of which make more sense and some of which make less sense in my own opinion. But at the core of these proposals, there’s a perceived conflict. There’s this belief that support for families and family formation comes at odds with policies that promote labor force participation.

“The EITC is a labor force-promoting idea that came from our side of the aisle. It came from Uncle Milty, Milton Friedman, who proposed the negative income tax. So, there’s a long history on our side of promoting labor force participation and tools like the EITC, but we’ve got some new proposals and they want to focus on family formation, like Senator Romney, who is a very close personal friend of mine, has a child allowance.

“There are a number of people who are pushing these ideas that would help support families with kids and on the positive side, they would reduce poverty by a lot. But it’s also possible that they could have negative effects on labor force participation. My one concern is that we’re being forced into this debate of choosing.

“If we look at child allowances, my concern is, if we do this, it’s a pretty new program and we’re not sure of all the effects of this. I would much rather see a state take the lead and play with a child allowance and beta test it. They would see what the drawbacks are and what are the unintended consequences. Does it actually reduce labor force participation? Because I think this is something that you just wouldn’t want to put nationwide right way and frankly, I think there are some other tools that are already in place to kind of give us what we need.

“But I think we’re better off in this battle of ideas and it’s a good thing when we know what works and then figuring out ways of finding the fiscal space to pay for those things… We also have had large expansions to the CTC and the EITC. These are preferable in the sense that we have a good understanding of their effects. I think if we are going to spend money in this area, this is where we should be looking first.

“I don’t think the overall goal between family stability and labor force participation need to be in tension. I think one of the things that we can look at is reducing marriage penalties with the EITC. A lot of people on our side of the aisle are looking at just doing that, building on the current program because we generally know the effects of it….”

Good policy discussions lead to better outcomes for American people:

“I will say, I’m excited to see the energy in this space, especially on the conservative side. When we get folks like Senator Romney or Rubio or whomever on the conservative side putting out interesting, innovative proposals to reduce poverty, we end up in a much better place for policymaking. And policymakers trend towards where the action is, so if we are spending a lot of intellectual capital here, the political capital will follow.”

Washington, DC – This morning, the American Idea Foundation announced that former Speaker of the House Paul Ryan will moderate a virtual discussion with a bipartisan panel of experts entitled: Learning Lessons and Empowering Individuals: How to improve the Earned Income Tax Credit and Child Tax Credit.

The virtual event will take place on Friday, April 9th from 1:30 – 2:30 pm ET. To attend, please RSVP by emailing: RSVP@AmericanIdeaFoundation.com.

Given Speaker Ryan’s leadership of the House Ways and Means Committee, as well as his work on poverty-fighting issues throughout his career, he is uniquely qualified to lead a conversation about how these specific tax policies can be properly utilized to expand economic opportunities.  Joining Speaker Ryan in conversation will be:

• Diane Whitmore Schanzenbach, Northwestern University
• Katharine Stevens, American Enterprise Institute
• Scott Winship, American Enterprise Institute

This is the latest in a series of policy panels hosted by the American Idea Foundation and follows successful discussions on Opportunity Zones and criminal justice reform.

The American Idea Foundation is premised on the belief that everyone should have the opportunity to pursue their version of the American Dream and that policymakers should look for solutions that empower individuals and communities to reach their full potential. Speaker Ryan has long believed that our nation’s tax code is in need of pro-growth reforms and though his leadership on the Tax Cuts and Jobs Act improved the tax system for the first time in a generation, there is still more work to be done. This conversation aims to educate and inform stakeholders on different perspectives around expanding or reforming the Earned Income Tax Credit and the Child Tax Credit.

To find out more about the American Idea Foundation, please visit: www.AmericanIdeaFoundation.com.

Date: March 12, 2021

Janesville, WI – In the Fall of 2020, former Speaker of the House and American Idea Foundation President Paul Ryan was named an Honorary Fellow at the Tommy G. Thompson Center for Public Leadership. The Center, located at the University of Wisconsin-Madison, works to elevate the policies and solutions that were the cornerstones of Governor Thompson’s decades of service to the state of Wisconsin. Earlier this month, Speaker Ryan had the opportunity to talk with the Thompson Center’s Executive Director, Dr. Ryan Owens, about the policy issues that he has been focusing on since leaving the House of Representatives in 2019.

During the podcast, Speaker Ryan discussed the need for revitalizing civil society – the institutions and spaces between citizens and their government. He touched on ongoing efforts by the American Idea Foundation to highlight locally-implemented, evidence-based solutions that tackle problems like persistent poverty and the skills gap. Speaker Ryan also provided some guidance to younger Wisconsinites who are looking to make an impact in their communities.

You can listen to the Tommy G. Thompson Center Badgercast featuring Speaker Ryan by clicking here.  Some excerpts of Speaker Ryan’s answers (which have been edited slightly for clarity) follow.

A continued focus on tackling poverty:

“You mentioned Janesville, my home town. My downtown Janesville office is where the American Idea Foundation is based and that’s the Foundation that I built to focus on poverty solutions. During a lot of stages in my career, I spent a lot of time working on understanding poverty — specifically stubborn, multi-generational poverty, and understanding the policies that alleviate poverty. Near the end of my tenure, I was able to put into law through the tax code and other mechanisms, some policies that I think are really going to make a difference in the poverty space.

“And so, the American Idea foundation is really focused on advancing these poverty solutions, getting them out into the country, and building solutions that can be scaled, replicated, and repeated so that we can really put a dent in poverty and go at root causes of poverty and focus resources so that we can really make a big difference. [We can make a big difference by] making sure the Evidence Act that we wrote is well-executed and by building a big database of poverty solutions that people who want to fight poverty can go to for support and assistance. We believe in all of this… using data, analytics, and random controlled trials to measure what works and then scaling and repeating, and then making sure you don’t repeat mistakes.”

Policies that will spur economic opportunity:

“We need lifelong learning. We need people to get skills for the jobs of tomorrow [because of the] technology displacements that are occurring. And so, one of the things that we’re focused on is how do you get people into school and get their skills acquired and get them to stay through it. There is a big problem with people not graduating with their Associate’s degree, but if you can get an Associate’s degree in the 21st century, you can often get yourself into a proven career.

“Another thing that I’m really enamored with is this Catholic Charities [approach of] case management navigators that help people who are deep in poverty. [These navigators] find people where they are and then bring services and knowledge to them. Every person has a case manager that helps them build a plan to get out of poverty and work themselves out of poverty and stay out of poverty. I work with the Laboratory for Economic Opportunity (LEO) at Notre Dame and we’re running trials on this right now in places across the country to really figure out how best to do this kind of service so it can be scaled and replicated using technology, data, and analytics….

“In the 20th century, the War on Poverty was basically a bunch of government programs run by government bureaucrats and they kind of missed out on a lot of innovative ideas and proper incentive structures which have really moved the needle and so that’s the kind of thing we’re trying to incorporate. We’re essentially using free enterprise principles and applying them to the problem of poverty and I think we’re going to get a difference in outcomes.”

Advice to younger Americans on the perils of polarization and seeking out diverse perspectives:

“The reason I’m concerned [about polarization] is it’s getting so out of control and it’s being digitized and monetized with 21st century social media technology…. I try and tell young people to identify and see the fact that when you have an online presence or when you just go online, you’re inevitably going to go into some ideological cul-de-sac and you’re probably going to be just getting reinforcing views and today, media and technology, just more or less tell you what you want to know.

“We have moral relativism. We have algorithms and we have all of these sites that feed you what you’re already biased toward and that confirmation bias is now digitized and there are a lot of people who make a lot of money feeding that….”

“There’s not a great answer to how do you reduce polarization or how do you get people to reintegrate into society, other than we’ve got to find ways to revitalize civil society, which is where we live our lives and is the space between ourselves and our government. How do we, as individuals, get involved at a human level, at a personal level, with people who don’t think like us and who don’t look like us and who aren’t like us, and build lasting relationships and get a sense of empathy and a sense of understanding?

“The thing I always tell young people is don’t lead with emotions. You have two ears and one mouth, use them in that proportion and just really work on trying to understand the perspective of another person. Walk in their shoes and hopefully they’ll do the same to you and you can develop a better understanding.”

Assessing the first two months of the Biden-Harris Administration:

“I’m a little concerned… I like [President Biden]. He’s a nice person. He is an agreeable guy. He does deals. I’ve done agreements with him myself so he is naturally not opposed to finding common ground with people on the other side of the aisle and getting agreements done. The team beneath him is maybe less so.

“The thing that makes me a little concerned at this moment is on the COVID-19 bill. Ron Klain, his Chief of Staff, and others said: “Look, we made the mistake in 2009 when we tried to get Republicans to work with us on a stimulus and it took too long and then we finally did it on our own. We just want to learn from that mistake and try and cut to the chase and just ram it through….” They really didn’t ask for our participation in 2009. I remember then-Rep. Chris Van Hollen having one, 30-second conversation with me, which was: “Are you going to support this or not?…”

“This was different because COVID is a pandemic that everybody believes is a crisis that needs attending to and you had Republicans offering solutions and going down to the White House to say: “You know we agree on you know half of this stuff. Let’s work together….” Instead, they chose reconciliation which is a way of avoiding having to work with the other side and ramming it through. If you can’t get bipartisanship on something like COVID and getting the economy out of the COVID-19 pandemic, I don’t know where else you are going to find bipartisanship in this day and age. I really think they whiffed on this one…”

Issues of common ground in 2021:

“Well, I think the thing that everybody more or less agrees on is that there is a challenge and a great power struggle with China. We call this “decoupling” and that’s going to happen. I think most Republicans or Democrats who look at this issue see it similarly, which is, we have to protect ourselves and our technology from cyber-attacks, from China, and from their competition. We want the free world to be able to stay free.

“When you look at all the technologies that are rolling out there — whether it’s artificial intelligence, machine-learning, the Internet of Things, cryptocurrencies, all of these things, it’s really important that the free world is led by America and that America leads in these cutting-edge technologies because if China takes over and dominates, then they can they can really intimidate the world. They can become a ubiquitous surveillance state and it gets kind of scary at the end of the day, so where I think America has to lead – and Republicans and Democrats agree on this, is in sort strategic decoupling with China. That, to me, is a pretty big deal and I think infrastructure and some other sort of meat and potato issues, you’ll see some people coming around on.”

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