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Present at the Creation

Jodie T. Allen
Posted Monday, Dec. 13, 1999, at 9:56 AM ET

Among the many things Al Gore has claimed credit for introducing to the world is apparently the Earned Income Tax Credit. This is a refundable credit paid by the IRS to below-median-income workers that has, over the last 25 years, swelled both in size and in the esteem with which it is held by Republicans and Democrats alike.

Many politicians have wrapped their arms around this sturdy reinforcement for the efforts of ill-paid workers, but few if any have been so fulsome in their embrace as was the vice president in a November interview with Time Magazine. In commenting upon his rival Bill Bradley's proposed expansion of the EITC, Gore asserted, "I was the author of that proposal. I wrote that, so I say, welcome aboard. That is something for which I have been the principal proponent for a long time."

Last week, the Bradley forces jumped on the veep's claim of authorship, pointing out in an ad that the EITC became law in 1975, a year before Gore was elected to Congress.

Who then can claim credit for this invention, which this year distributed close to $30 billion in refunds to some 20 million families and individuals? Chatterbox knows because Chatterbox really was there--or at least close by.

Just for the record, the EITC was the brainchild of the powerful Senate Finance Committee Chairman Russell Long. Yes, Russell Long, the son of Huey Long, the flamboyant populist governor of Louisiana immortalized in All the King's Men. In the 1970s, Russell Long was anathema to most liberals, who viewed him as the major roadblock in the way of a more generous welfare state. And, indeed, Long was an arch opponent of President Richard Nixon's Family Assistance Plan, which would have doubled the size of the welfare rolls by extending cash assistance to the "working poor."

Long didn't like the idea adding millions of people to the rolls, but he wasn't at all adverse to the notion of giving poor people a helping hand--as long as it was done in a way that would encourage rather than discourage work. So he asked one of his staffers, Michael Stern, to work out the details of a plan that would do just that. Michael Stern, in turn, asked Chatterbox and a friend of hers from the Urban Institute to help out. The final plan, which the Finance Committee reported out in 1972, was remarkably generous--certainly more generous than the welfare reform enacted a few years ago of which both Gore and his boss the president brag. It guaranteed a job to any family head needing work. True, the wage in these public jobs was sub-minimum, so as not to encourage people to abandon their private sector jobs for the perhaps less demanding public sector. But to help out people working in poorly paid jobs, Long came up with the idea of rebating their Social Security taxes as a "work bonus."

Although Mike Stern was assigned to work out the details of how the EITC would be computed, he insists the idea really was Sen. Long's. "He liked the idea because it rewarded work," says Stern, who is now with the Investment Company Institute.

The net cost of the plan was about $4.3 billion, including $1 billion for the EITC--big, big money in those days and more than a 60 percent increase over what the feds were then spending on welfare for families. As former Federal Reserve governor, OMB director, and CBO director Alice Rivlin noted at the time, when she and Chatterbox were on a panel together, if someone other than Russell Long had proposed this, they would have been acclaimed as a hero. But because it was a Long product, it was branded by the press as "slavefare" and went nowhere in Congress. But Long continued to press for the EITC part of his plan, and in 1975, while the fight over welfare reform was still raging, it quietly passed into law. So quietly that Al Gore apparently didn't notice it.

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Jodie T. Allen is the senior editor at the Pew Research Center.
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The readers respond:


I interpreted Gore to mean that he had authored a more recent expansion of the EITC, not that he created it in the first place. If that is the case, I don't think Chatterbox's criticism of Gore is justified, unless of course Gore's claim regarding the expansion is also inaccurate.

--Richard Primoff

(To reply, click here.)


The Clinton administration can claim credit for proposing and getting enacted a pretty substantial expansion of the EITC, so maybe Gore was talking about that.

--Richard Riley

(To reply, click here.)

(12/13)


Like Richard Primoff, when I first learned of the Bradley attack I assumed that what Gore had said was that he had been a main proponent of the various expansions of the EITC (which, as Edward Byrnes has noted, have had the unfortunate side effect of making it a prime target of tax cheats). But when I looked up the interview in Time it seems quite clear from his language (assuming it is correctly quoted) that he was claiming authorship of the whole thing.

--Jodie Allen

(To reply, click here.)


The Time article quotes Al Gore as saying about Bill Bradley, "[He proposes] the expansion of the Earned Income Tax Credit. I was the author of that proposal. I wrote that, so I say, welcome aboard. That is something for which I have been the principal proponent for a long time."

It is clear from Al Gore's remarks that he claims two things: (1) Al Gore wrote the EITC proposal or the expansion of the EITC proposal and (2) Al Gore has been the principle proponent of EITC "for a long time."

The first claim is highly unlikely even if one assumes that Al Gore means he was the author of the more recent expansion and not the EITC proposal. The vice president has not been writing legislation during this administration.

The second claim is laughable given that the EITC is so popular among members of both parties. There is no "principle proponent" of this long-standing, popular program.

--Jack

(To reply, click here.)

(12/15)


I'd like to help set the record for Slate.

The quote from Time magazine was:

"(He proposes) the expansion of the Earned Income Tax Credit. I was the author of that proposal. I wrote that, so I say, welcome aboard. That is something for which I have been the principal proponent for a long time.''

Clearly Gore was referring to a proposal to expand EITC. On Feb. 7, 1989, Gore and Reps. Tom Downey, George Miller and John Lewis introduced a bill to expand the EITC by $34 billion by raising taxes on people earning more than $200,000 a year. Much of that proposal was incorporated into the 1993 Clinton-Gore tax increase. I wrote a story about the tax proposal for the Memphis Comnmercial Appeal.

--James W. Brosnan

(To reply, click here.)

(12/16)


Mr. Brosnan has added another small footnote to the long history of the EITC. He notes that then-Sen. Gore cosponsored one of many EITC expansion plans, though not one that made it directly into law. As the House Ways and Means Committee's authoritative "Green Book" notes, there were several expansions to the EITC:

The earned income credit (EIC Code sec. 32), enacted in 1975, generally equals a specified percentage of wages up to a maximum dollar amount. ... The income ranges and percentages have been revised several times since original enactment,expanding the credit (see table 13-12). In 1987, the credit was indexed for inflation. In 1990 and again in 1993, Congress enacted substantial expansions of the credit. ...

So what Vice President Gore might have accurately said was, "I was the co-author of one of numerous proposals to expand the EITC, though the one I cosponsored wasn't the one that was enacted into law in that period."

That's not what he said.

--Jodie Allen

(To reply, click here.)

(12/20)

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