Child Subsidies

http://www.cbc.ca/news/business/canada-child-benefit-social-safety-net-baby-bonus-childcare-justin-trudeau-social-assistance-1.3685290

So, I am pretty pissed about this because we are now actually going to be getting NOTHING because we make too much money (and pay taxes), losing out on approximately ~$1,400 after tax cash per year. Yes, my wife and I both work and do pretty well (I would say upper middle class income level), and yes, $1,400 won’t make a hugh difference (may cut back on vacations / dining out).

But what bothers me are…

  1. I feel like it incentivizes poorly educated / financed people to fornicate more and have more kids that will be further drain on the society down the road (such as the lady in the article… I don’t know her full circumstances but why anyone would have 4 kids when you are making $30K having trouble making ends meet is hard to comprehend).

  2. The money may not actually go toward helping the kids as these so called “parents” seem to have money to spend on things like booze, smokes and casinos.

  3. Keeps people that could add value to society at home thus negatively impacting the overall productivity / economy. I am seriously considering whether one of my wife or I should stay home and look after the baby because daycare is going to cost $2K per month, income tax just went up, and cost to commute will cost us more with carbon taxes as well.

  4. People who shouldn’t be getting these benefits will be getting them. (IE. millionaire Chinese families buying up real estate in Van City or so called “refugees” that brought over 5 kids and are already receiving tax payer support without having paid a dime into the tax pool)

I am however, open to other views… if someone can really convince me that this will be generally good for the society in the long run. For now, I just see it as some dumbazz left wing policy to get more votes.

Sounds like it’s basically a wealth distribution disguised as a child benefit. They probably could have accomplished the same thing by just increasing taxes. This way is just more politically acceptable.

It’s not just a feeling, you’re right!

Also, these are positive/negative incentive programs that promote dysgenics (further decline in human genetic intelligence). It’s a fact that lower IQ people make more babies because they don’t think things thru and can not learn/remember how to use birth control, higher IQ people plan responsibly making only the babies they can afford. These society incentives just further accelerate the trend which already exists.

“The poorest of those families will see the biggest boost while the wealthiest will see their child benefit payment disappear altogether.”

This comment on the CBC article summed it up well: Also anyone who thinks that all this money will actually be spent on children is also being incredibly naïve.

Money is fungible, and when you give people a check and doesn’t require it be spent on stuff for the kids, it probably won’t be, at least for sure not in its entirity. If only somebody could find the data to regress % change in sales at local liquor stores and beer vendors vs. % of residents getting this newly enhanced benefit., One can dream but I doubt that would ever come out or be available.

So given that government keep making assinine policies like this one…

How would you view it if I were to legally separate from my wife and file my taxes from another residence (ie. parents’ address) so that we can keep collecting some benefits? It’s not illegal… but maybe unethical?

See Murray Edwards: http://business.financialpost.com/fp-comment/the-tax-climate-refugee-murray-edwards

firstly, upper middle class households should have never been receiving child benefits so it is not about comparing the new policies with the old policies. there is no economic, social or moral benefit to giving rich people subsidies for kids.

the very poor, like the one example you provided (income under $30k), actually aren’t receiving much more under the new policies as they already received large benefits via the National Child Benefit and the various other provincial programs. it is those in the $50k-$90k range that receive the greatest increase in benefits with the new policies. the average $50k-$90k household has two income earners and likely pays daycare or has periods of maternity leave, so the increase in benefits will go to help those families who are cash poor.

my wife and i both work and live in a beta city, and having two kids in daycare is still brutal, even if you’re making ~$100k as a household. maternity leave kills your cash flow.

the new policies only amount to a reduction in after-tax benefits for 2 kid families if household income is above ~$140,000. i’d say at $140,000, you’re doing well enough that you no longer need child benefits to live very comfortably. it is certainly not the government’s job to provide anything beyond extreme comfort. also, that $140,000 is after RRSP contributions so for a family that saves for retirement (i.e. a prudent family), benefits shouldn’t decline from the previous amounts until the $170,000 gross income level.

the fact that your household income is likely well above $170,000 and you are complaining is just sad.

But there is a genetic benefit, which becomes economic over the long-term. To not factor this into your “analysis” is just plain sad.

Encouraging dumb people to make more babies – not smart.

Why not just give everyone a tax credit for children and adjust the tax base accordingly? Look at the discontent the class warfare causes. I’m pretty sure if you pay a million in taxes a year, you’ve earned your credit. Food stamps for all. Welfare for all. #stopclasswarfare #killthebureaucracy

to provide an incentive that actually moves the needle would require subsidies in the $50,000+ annually which would be blatantly retarded. the fact you think subsidizing rich people to have kids is actually a consideration is ridiculous. it’s not like when you reduce taxes on the 1% they start procreating at higher rates. for the rich, having kids is a lifestyle choice not a financial one. it doesn’t really matter how much money you throw at them, they still aren’t going to choose a lifestyle full of kids activities and responsibilities as they typically have their own activities and responsibilities.

Great idea. Allow parents to deduct kids as 50% of the basic exemption and be done with it. Matt: Our income tax system is already very progressive in Canada. Absurdly so actually. These changes just increase the wealth distribution impact of government. I see no different in Justin cutting my child benefits by a couple thousand or him raising my taxes by a couple thousand. The net impact is the same to me and to the state. Though he increased my taxes too, so WTF…

This was the case prior to the new liberal policy. I would receive a universal childcare check and get taxed based on my higher tax bracket (thus the clawback). Lower income family would be taxed at a lower rate, thus keeping more.

Huh, I’m going to have to use my “I agree with Purealpha” card here. Won’t happen again until 2019.

the greatest thing about the new child benefit policies is that they actually work to fight income inequality. the poor aren’t getting much more (but they’re doing much better now than a few decades ago), the rich are getting less (they are getting far more than a few decades ago) and the middle is getting much more (they are getting less than they did a few decades ago). the middle is struggling and this is one of the first policies, along with the tax cut between $45-90k, that actually works to prevent the growing income disparity between the middle and upper middle. i am perfectly fine with getting less when my gross family income is above $170k. it’s called perspective. i’m a rich a$$hole at family income of $170k+. guys, just realize you’re rich a$$holes.

There are more direct ways of addressing income inequality, mixing reproduction into the matter is unnecessary, and dumb.

I don’t have the stats in front of me, but last I saw, in general number of kids tends to be inversely correlated with household income. So what if we had financial incentives for poor people to not have kids? If the people that are least likely to be able to adequately provide for kids are the ones having the most, doesn’t this seem like it could make economic sense? Or reduce the transfer benefits for kids after the first two, give 50% for the 3rd, and zero for any additional kids? Replacement rate for the population is ~2.1 kids per couple. If you leave the benefits uncapped it just gives incentive to have 4-5 kids because the people who would do this likely don’t have the financial thought process to think beyond “alright the govment will give me $5k more for another kid!”

Exactly, I’ve been saying this forever. Lots of smart ideas could be explored here.

Whoever the “analysts” are working at these society planning type jobs, they are definitely B-team. Really past time for “long-term society planning and analysis” to become a serious field, with serious people. Take some of the smart guys wasting their life as quants at hedge funds, and move them into these important jobs.

I have a feeling that poor people will reproduce at the same rate regardless of this benefit; if economics were a major factor, they would not have so many kids to begin with.

I actually think upper middle to rich people should be the ones encouraged to have more kids, even if this costs the government money to implement. Rich parents will invest more in the kids, stimulating the economy and producing future higher productivity individuals.

sounds like China most people = 1 child max wealthier can pay fine for 2+

You sir are hired!

Case in point, any amount of discussion and analysis on these topics by the smarties, and bam, we make progress. It’s not necessarily a hopeless problem. It’s just that serious jobs in this field do not yet exist, currently just some dimwit government employees not thinking things thru.

How is it sad that I’m complaining? Is it so sad that as a tax payer, I ask for benefits that other families who pay less taxes are entitled to? My wife and I worked hard / invested time & money to make what we make, and I don’t feel good about being penalized for it. Over the last several years, my wife spent $100K+ on an an MBA. I completed my CPA and is near my completion of CFA program - this takes time and money as you know. So, we put off having a kid until now so that we could be financially well established to provide for our kid(s) since kids are expensive. Reading your situation, I am sure you had taken a similar approach and I agree mat leave is a pain since my wife is on one now.

Also, I’m not asking for government to provide me with extreme comfort… what I’m asking for is that they do not use our tax dollars to support the poor decisions of others who do not plan for kids.

I am not against supporting people who have fallen on hard time or to good causes and we live pretty modestly to do so (ie. we have one car - 2010 Nissan Murano and I take the bus to work). My wife and I give to our local church, cross cancer institute, sponsor a child overseas through HART foundation, fort mac disaster and etc etc all in the tune of close to our 10% of net income (yes we get tax benefits for these). However, my view is that this particular program doesn’t really improve the outlook for our society and is a scheme just to get more votes for the liberals (see my original post).

It’s all a moot point since we are stuck with the current government for at least another 3 to 4 years, but I would like to see some constructive arguments as to why this is good for our society to counter the points I made rather than outright saying it helps cash poor families and that it will definitely go towards helping children… because I see good number of people making $50-90K driving new Audi’s, BMWs and other high end vehicles that they financed.