Why does our tax system give out money beyond the amount payed in tax ?

Because in trying to mold behavior, congress (not the president) decided to reward people with money.

Congress is blissfully unaware of the amount of fraud this generates and the fact that EIC creates and entitlement mentality, not appreciation for the help.

The federal income tax system collects taxes from taxpayers, and also distributes money to taxpayers for various programs, such as the Earned Income Credit, the First-time Homebuyer Credit etc. This is a matter of public policy that has been put into law.

Because that is the decision that the Congress of the United States of America made (many years before Obama was elected). It does not matter whether it makes sense or not. Once Congress decides on the tax laws, the IRS has to follow Congress's decisions, even if they are illogical.

It is not because Obama is President; it was the law before he was elected, and it would have remained the law even if he was not elected.

Congress decided to use the tax system to encourage low income people to work.

yea, I definitely agree with some of your statements but we can't get into the heads of those in Congress who come up with some of these ideas

Because obama is president.