There are currently over 6.6 million people in the united states that are unemployed (U.S. unemployment) and according to the U.S. bureau of labour statistics, these rates have remained unchanged for the better part of 2017 and 2018. Out of this large portion of unemployed members of the society, nearly “2.9 million Americans were claiming compensation” (Bureau of labour Statistics data). This compensation that is aimed at providing the needed relief to the unemployed, is most likely also the reason behind the stable unemployment rates in the United States. John Carney, an author for the CNBC and Tim Harford from the Slate magazine have come to the same conclusion after interviewing several economists. They have both concluded that by providing unemployment benefits, we are giving the people an incentive to remain unemployed, and this is contributing the problem of unemployment (Carey, Harford). It therefore becomes vital for the government to look at their unemployment welfare policy and make drastic changes and possibly even move away from the policy. In order to decide exactly how one can bring about the necessary changes, one must take a closer look at other policies, such as the earned income tax credit that might be an excellent replacement to the current unemployment welfare policy. The earned income tax credit may help solve the current complex problem of unemployment, and might prove to be much more efficient than the unemployment welfare policy. The Earned Income tax credit, EITC for short, is a federal tax credit for lower income workers. Since its establishment in 1975, the once small and obscure provision of the federal tax code been able to transform to “one of the largest programs in the U.S. social welfare system” due to it providing over 47 billion U.S. dollars every single year to more than 24 million families (Skyes). Politicians throughout history have supported this policy and even President Bill Clinton himself once called this policy “a cornerstone effort to reform our welfare system and make work pay” (William). Looking at this historical and political side of ETIC begs the question- ‘Is the EITC a better alternative to the current unemployment welfare program?’This question can be answered by looking at the cultural, economical and social benefits and disadvantages of this policy that together determine whether the policy is advantageous. First and foremost, the members of the society that this policy targets and helps is a highly valued group of the society- the working parents. As shown in the graph to the right that is taken from the Internal revenue service, United States’ tax collection agency that administers the ‘Internal Revenue code’ enacted by Congress, ETIC provides the most benefits to low-wage workers that have two or more kids (Internal revenue service). The graph displays the value that is received by different members of the society based on the number of children they have, and how much their income is. In order for one to obtain any benefits through this policy, one must be a working member of this society. This results in the policy promoting work and helping to increase not only people’s incentive to find work, but also increasing the overall employment rates. Research conducted by Hilary Hoynes, an economist who is one of the world’s leading researchers on the issues related to the labour market, (New research), has found that EITC has been able to increase unemployment as well as decrease the use of welfare among single female parents (Meyers). Ankur Patel, an employee at the Treasury department also observed the same increase in employment due to EITC (New research). Looking at the economic conditions of individuals who are benefited by this policy, a decrease in poverty can also be observed. According to the Center on Budget and Policy Priorities, an American think tank that analyzes the impact of federal and state government budget policies, in 2013 alone this policy helped lift 9.4 million people above the poverty line, of which 5 million are children (Center of Budgets). Most researches analyzing EITC conclude that the policy has had a huge impact in decreasing the poverty. However, Anne Alstott, the author of “why eitc doesn’t make work pay” disagrees. According to her, although the policy does help lift people over the poverty line, the poverty line “incorporates an unreasonably low standard of living” which she explains that the families that they consider ‘poor’ are the families that are in “extreme distress” (Alstott). She also points out that the number of children this policy pulls out of poverty is not that high considering that the policy advocates that it “lifts more children out of poverty than any other single program or category of programs” (Center on Budgets and Policy Priorities). This is contrary to what other researchers have concluded, yet highlights the drawback of this policy. Returning to the benefits of this policy, research shows that one of the social and cultural benefits is the feeling of inclusion that this policy provides. Four researchers interviewed 115 EITC recipients about their 2006 tax filings and recorded the replies of each person (Skyes, Jennifer et al.). Through what these people said in the interviews, patterns were created to find a trend about how the people feel about this policy. Through their responses, the scientists discovered that eitc was “more than dollars and cents”. EITC to the members that received benefits from this policy showed “evidence of feelings of social inclusion that are fueled by the refund check” (Skyes). People said that through the benefits they received, their role as a working-parent was emphasized and this boosted their self-esteem. Also, they deemed eitc as a ‘reward’ for the hard work that they had done for the whole year. According to most of the people who participated in the interview, due to the money from eitc they could do and buy what they ‘wanted’ instead of what they merely ‘needed’. All participants showed signs of feeling extreme relief as they were able to to pay off their debt and get a little ahead in life. For example, Claire Haynes, the mother of three children, stated that “sometimes the kids get what they need, but it’s not what they want.” “so with this refund money, I was able to take them to T.J. Maxx and let them pick their clothes. It might have been a couple of dollars more expensive, or it might have been even double the price, but the point was they got what they needed and at the same time they felt like a million bucks. Because they got actually what they wanted. My kids felt like a million dollars” (Skyes, Jennifer et al.). This interview alone displays just how much the eitc means to the people. It is a form of ‘hope’ for these people that they are capable of making it in life. Despite all the aforementioned benefits, one the cons of the EITC is that it is not that widely known. According to IRS, nearly 4 million eligible individuals fail to file for their eitc and this translates to nearly $4 million (Annie). This is an aspect of the eitc that requires more work since this prevents the policy from benefiting the people that need the help. The battle against this ignorance has already begun as states and cities have begun their own “EITC knowledge campaign” (Mendenhall). The unemployment benefits does more harm than good, as it tends to increase the overall unemployment rates. It therefore becomes important to take a closer look at policies such as the eitc which might be a better alternative to the welfare program as according to the sources presented previously, it not only increases employment rates and decreases poverty but also create feelings of social inclusion as eitc is perceived as a reward to the members of the society that are benefited by this policy.