Good morning! Marine Le Pen is waiting in the wings in France, the Supreme Court hears oral arguments in its trans medicine case, and Sam Altman's OpenResearch examines the impact of the child tax credit.
- Policy impact. Since 2016, Elizabeth Rhodes has been leading Sam Altman's study of universal basic income, a multi-year project that started as a way to determine how cash transfers could mitigate the impact of AI-related job losses. The results released this past summer found that while receiving $1,000 monthly payments, people spent more to meet their basic needs and worked fewer hours but ultimately stayed in the workforce.
As the head of OpenReseach, Rhodes is now sitting on a trove of data about people's financial needs and behavior. "One of the things that we always thought about and designed the project around was that it could inform a wide range of policies and programs, not just unconditional cash transfers," she says. For her team's latest project, they examined the impact of the 2021 child tax credit expansion, which happened while they were following the 3,000 families who were part of their cash transfer study.
For six months, families with children received monthly payments with a tax credit expanded to $3,600 per child. Incoming president Donald Trump and vice president JD Vance have both in the past expressed some support for the child tax credit, compelling Rhodes' team to share more information about the policy's impact now.
They found that while families received monthly child tax credit payments, parents and children both saw a decrease in food insecurity—4 percentage points for children and 6 points for adults, likely because parents already make sure their kids are fed first. Families spent $15 more a month on food while receiving these checks.
But the child tax credit wasn't a panacea: Parents experienced no reduction in stress while receiving extra money. The fact that the child tax credit was a temporary reprieve, expected to come to an end amid high inflation and economic uncertainty, likely contributed to stress levels, Rhodes says. "They couldn't necessarily incorporate it into their medium- and longer-term financial strategies," she says.
While Altman and OpenResearch have advocated for greater understanding of unconditional cash transfers, the child tax credit is a form of cash transfer that can be an easier political sell. "History has shown that people are more open to supporting children," Rhodes says.
Emma Hinchliffe
emma.hinchliffe@fortune.com
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