1.0Employment Policies Institutehttps://epionline.orgepionlinehttps://epionline.org/author/epionline/rich600338<blockquote class="wp-embedded-content"><a href="https://epionline.org/studies/r69/">Helping Low-Wage Americans – Wage Based Tax Credits: A New Solution to an Age Old Problem</a></blockquote> <script type='text/javascript'> <!--//--><![CDATA[//><!-- /*! This file is auto-generated */ !function(c,d){"use strict";var e=!1,n=!1;if(d.querySelector)if(c.addEventListener)e=!0;if(c.wp=c.wp||{},!c.wp.receiveEmbedMessage)if(c.wp.receiveEmbedMessage=function(e){var t=e.data;if(t)if(t.secret||t.message||t.value)if(!/[^a-zA-Z0-9]/.test(t.secret)){for(var r,a,i,s=d.querySelectorAll('iframe[data-secret="'+t.secret+'"]'),n=d.querySelectorAll('blockquote[data-secret="'+t.secret+'"]'),o=0;o<n.length;o++)n[o].style.display="none";for(o=0;o<s.length;o++)if(r=s[o],e.source===r.contentWindow){if(r.removeAttribute("style"),"height"===t.message){if(1e3<(i=parseInt(t.value,10)))i=1e3;else if(~~i<200)i=200;r.height=i}if("link"===t.message)if(a=d.createElement("a"),i=d.createElement("a"),a.href=r.getAttribute("src"),i.href=t.value,i.host===a.host)if(d.activeElement===r)c.top.location.href=t.value}}},e)c.addEventListener("message",c.wp.receiveEmbedMessage,!1),d.addEventListener("DOMContentLoaded",t,!1),c.addEventListener("load",t,!1);function t(){if(!n){n=!0;for(var e,t,r=-1!==navigator.appVersion.indexOf("MSIE 10"),a=!!navigator.userAgent.match(/Trident.*rv:11\./),i=d.querySelectorAll("iframe.wp-embedded-content"),s=0;s<i.length;s++){if(!(e=i[s]).getAttribute("data-secret"))t=Math.random().toString(36).substr(2,10),e.src+="#?secret="+t,e.setAttribute("data-secret",t);if(r||a)(t=e.cloneNode(!0)).removeAttribute("security"),e.parentNode.replaceChild(t,e)}}}}(window,document); //--><!]]> </script><iframe sandbox="allow-scripts" security="restricted" src="https://epionline.org/studies/r69/embed/" width="600" height="338" title="“Helping Low-Wage Americans – Wage Based Tax Credits: A New Solution to an Age Old Problem” — Employment Policies Institute" frameborder="0" marginwidth="0" marginheight="0" scrolling="no" class="wp-embedded-content"></iframe>http://epionline.org/app/uploads/2004/05/13-1.png860720Sixty-five years ago, pharmacies stocked mercury, heroin, and radon as remedies; few people believed that a fungus-based drug called penicillin could cure anything; and the minimum wage was considered our most effective anti-poverty policy. Doctors prescribing mercury today would lose their license, yet the popularity of similarly counterproductive minimum wage increases endures—despite the existence of successful anti-poverty measures such as the federal Earned Income Tax Credit (EITC). The near-universal conclusion of decades of economic research is that minimum wage increases diminish total employment and destroy opportunities for entry-level employees. Moreover, most of the benefits associated with minimum wage hikes accrue to non-poor families. The EITC, in contrast, increases poor Americans’ income and work-effort, without destroying job opportunities. Despite these well-documented realities, impending national elections—coupled with the superficial appeal of minimum wage increases—will once again lure lawmakers into promoting one of our least effective anti-poverty programs. But there is a better way. The Employment Policies Institute proposes a WBTC modification to the current federal EITC as a superior alternative to a minimum wage increase. The modest reforms required to create WBTC would make it a powerful tool to supplement the income of low-skilled working Americans. The WBTC will increase the effective wage of a full-time minimum wage employee with one child to $7.75 an hour. Employees with two children will receive $8.50 an hour. The average low-wage employee will receive 37% more benefits with a WBTC than under the current EITC. In addition to providing more benefits to those who need it most, a WBTC will cost less than the current EITC without the job-killing effects of the minimum wage.