The $25k Child Mortgage Credit

Under my proposed form of government, Randviscracy, citizens would qualify for mortgage reimbursement of $25k per child, with the number of eligible children based on IQ level of the parents averaged together. This is to create a soft eugenic effect over the long term. Studies of civilizations have shown that the most prosperous have large middle classes and small underclasses. In the past this was a side effect of strict rule of law (execution of criminals) and harsh living conditions (only the rich could afford to feed a large family). The result of this was that by the Victorian era, the estimated average IQ of Western nations during the Victorian era was 113.

Average IQ of parents and number of children eligible for $25k mortgage subsidy:

Below average IQ = 2 children/total of $50k mortgage subsidy

Above average IQ = 4 children/$100k

120 IQ or above = 10 children/$250k

A child subsidy of $25,000 per child seems like it would cost an enormous sum when first considering the plan, but after looking at the numbers and comparing it to other costs current governments pay, the program is very much a possibility.

At $25k per child, 1 million births per year would cost $25 billion. The average number of births for America currently are 3,791,712 according the CDC. This would equal out to $94.75 billion per year. Let’s compare this with some other costs America currently has.

Illegal Immigration costs America over $130 billion per year

Compare how much this would cost to pay for a large portion (or all) of every family’s home to how much illegal immigration is costing America each year.

A study by the Federation for American Immigration Reform(FAIR) found that the estimated costs of illegal immigration to American taxpayers is over $130 billion annually.

At the federal, state, and local levels, taxpayers shell out approximately $134.9 billion to cover the costs incurred by the presence of more than 12.5 million illegal aliens, and about 4.2 million citizen children of illegal aliens. That amounts to a tax burden of approximately $8,075 per illegal alien family member and a total of $115,894,597,664. The total cost of illegal immigration to U.S. taxpayers is both staggering and crippling. In 2013, FAIR estimated the total cost to be approximately $113 billion. So, in under four years, the cost has risen nearly $3 billion. This is a disturbing and unsustainable trend.

The Cost of Illegal Immigration on United States Taxpayers

Illegal immigration can be controlled and it is not as difficult as some with political motivation to import voters that they know will vote at a rate over 70% for them. Here are a few methods:

  1. Border wall/fences – border walls are an effective and necessary method of preventing illegal immigration. The nation of Hungary saw a 99.6% reduction in illegal immigration after installing a border fence.
  2. Identification(ID) checks required for vital services – many nations discourage illegal immigration by requiring ID for services like renting/buying houses, hotel rooms, apartments, vehicles, hospitals or any government service. This makes it hard to be a long term illegal immigrant when many services have to then be done on the black market at the risk of imprisonment.
  3. Prison sentences for illegal entry and aiding illegal immigrants – an example is that illegal immigrants and those who aid illegal immigrants in Mexico can face up to 10 years in prison.

These 3 measures alone would reduce illegal immigration and the $130 billion cost associated with it to almost 0. The reason America has such a large immigration problem is that the law is not being enforced in many “sanctuary” cities and states. In addition, government welfare, schooling and healthcare are given to illegal immigrants, increasing the attractiveness of illegal entry. The motivation for politicians again is to import voters and the motivation for businesses to both try to skirt the laws on hiring illegals and also supporting political candidates who don’t enforce the law is that immigration puts a downward pressure on wages and a upward pressure on prices, both of which benefit the business owner.

Property Tax and Education

I propose to fund the child mortgage credit using a property tax. Let’s look at whether property taxes would increase or decrease under the tax system I propose in Randviscracy.

In 2017 state and local governments in the US collected $525.9 billion in property taxes. Under the Randviscracy balanced tax system, property taxes are to pay for public schools and child mortgage credits. The costs of public schools in 2016-2017 were $739 billion. The average cost per student for public schools is $14,439 per year. Private schools vary in cost from $5,330 to $25,180, with the average being $10,740. The public can opt out of public schools and choose private schools instead and not have to pay this part of the real estate tax. This would reduce their property tax to only about about 18% of what they currently pay. (To get this number I took the estimated total cost of child credits divided by current total spent on property taxes.)

To prevent abuse of the public school system by people opting in when they need it and opting out when they don’t, the system would work like a membership and would be integrated with the libraries/recreation centers/public pools/community colleges/trade schools and adult education programs. Each year of opting in would reduce costs by 10% so that a person who has paid in for 10 years and was still paying would receive free services. In the case of young parents under 25 years old, their parents membership status would apply. This system would allow childless people and the elderly to still get a benefit from the money they pay into the system.

A factor that would lower the costs of those who chose the public school option would be that local businesses would also be paying property taxes which would help fund the public school system.

To ensure competition between public and private systems, there would be vouchers for the schools, libraries, recreation centers, etc. If a system in an area could not compete, so be it. It would be closed and sold to private management. The tax revenue would then go toward vouchers for citizens to use in public alternatives.

19.3% of the US population are school age. Multiply that by the average cost of private schools $10,740 (which due to competition the public schools would need to get their prices down to) then you have an average yearly cost of $2,072.82 per resident. Of course this is an average cost and will very greatly based on property value. Add to this an average of $427.50 for the child credit tax and you get a total of $2,500.32. The current average property tax paid by Americans is $2,375.

Scaled for property value

To distribute the costs in a way which does not disproportionately impact the poor, the amount of tax is scaled based on the value of the home or business. The median priced home pays the median price of the cost of the costs of education plus the average cost of the child credit. A home that cost twice as much as the median pays twice as much for the school and child credit taxes. Vice-versa if a property costs half of the median, both the school and child credit taxes are halved.

Businesses cannot opt out of paying into both the school and child credit taxes for their property.