`IF you work 40 hours a week and you have children in the home, you should not be in poverty."
That statement, made by President Clinton last week, ran as a theme through his presidential campaign. Now, as one way of helping to lift working families out of poverty or near-poverty, the president has proposed doubling the size of the earned income tax credit program to $25.4 billion within the next four years. Under this plan, every dollar a low-wage working parent earns up to a designated ceiling qualifies for a cut in taxes.
The tax credit is available to both married and single parents, even those who earn too little to owe federal income tax. About 1 in 3 American families now qualifies for assistance under the program. By 1997, the program would benefit 2 of every 5 families. The increases are partly aimed at offsetting the effect of new energy taxes.
Although the proposal enjoys bipartisan support, some critics complain that it comes at a time when lawmakers are looking for ways to slash budgets and to cut another entitlement, Aid to Families with Dependent Children, which benefits the poorest families. …