The Right Answer: on Welfare & Poverty

John Delaney: 1970s EITC ended disincentive for poor people to work

One way to do this is by expanding the earned income tax credit, or EITC. Before the EITC was established in the 1970s there was a disincentive for some people to work as they could end up actually pocketing less money, because of taxes, than those who collected welfare. This was a terrible situation and it essentially encouraged people to stay at home rather than get a job. The EITC changed that by giving a tax break to poor people who worked and earned money, thus giving them an incentive to continue working and earning more income.

The EITC is an excellent program. Every year, it helps keep millions of Americans from falling into poverty, and, like many successful programs, it has bipartisan support.