💡 New from us: Minimum payment requirements for student loans, the EITC at 50, the macroeconomic effects of immigration policy in the second Trump Administration, Sun Bucks, and American workers moving to find work.
Recent legislation during the reconciliation process includes changes to income-driven repayment (IDR) plans for student loan borrowers. Lesley Turner, Zaria Roller, and Sarah Reber discuss the potential costs and benefits of the recently passed Repayment Assistance Plan (RAP), which differs in several ways from past IDR plans, including the requirement of a minimum $10 monthly payment. They also identify policies that could improve upon RAP, especially relating to the minimum payment requirement.
Sarah Calame recaps a recent Brookings panel discussion on the EITC's 50th anniversary, which celebrated its legacy as a powerful anti-poverty tool and described some shortcomings. Panelists praised the program for lifting 6 million people from poverty and generating long-term educational and earnings benefits for children. However, the program provides less assistance to key groups like childless workers, families in deep poverty, and eligible individuals who do not claim the credit.
In a new analysis, Wendy Edelberg, Stan Veuger, and Tara Watson project that the Trump administration's aggressive immigration agenda is likely to lead to net-zero or negative migration in 2025, a drastic drop that hasn’t happened in at least half a century. This sharp decline will have significant negative consequences for the U.S. economy. Watson highlights this research in a recent episode of the Democracy in Question podcast, where she argues that because Congress has failed to update immigration laws for decades, a policy vacuum has allowed for excessive executive branch power over immigration policy. She cautions that this sharp reduction in immigration will not only stifle U.S. economic growth but could also cripple the country’s future talent pipeline by restricting the flow of students and skilled workers.
Jacob Bastian writes that states opting out of the new "Sun Bucks" summer grocery benefit program are forgoing a "free lunch" for their communities. He highlights how the new program builds on the success of pandemic-era initiatives by providing $120 in food benefits directly to eligible low-income families when their children don’t have access to meals in school. He argues that this federally funded program is a proven strategy to reduce child hunger and improve academic readiness, all while stimulating local economies.
The Brookings Podcast on Economic Activity had Tara Watson on to interview the authors of the recent Brookings paper covering whether American workers still move to find work. Christopher House and Linda Tesar presented findings challenging the common narrative that U.S. workers have become less willing to relocate for jobs. While overall interstate migration rates have declined, they argue this is not because workers are less responsive to economic opportunities. Instead, their research suggests that the economic differences between regions have gotten smaller over time.
