If your family earns $25,100 or less – and Sen. Cory Booker becomes President – he pledges your children will leave high school with $46,215 in the bank, courtesy of the government.
That’s the promise behind Booker’s “Baby Bonds” plan, a plan that would provide every single child born in America with a savings account worth $1,000 at birth and up to $2,000 extra on every birthday.
It’s a bold plan to tackle inequality — one that experts estimate would cost the nation about $80 billion each year — but Booker’s hopeful that it’s the type of change Americans want to see enough to put him in the White House.
Cory Booker’s Baby Bonds Plan
Booker’s plan is about tackling inequality, especially for young people of color.
Under the American Dream, he says every person should have the ability to pull themselves up out of poverty. Booker argues, however, that it’s a lot harder to pull that off in practice, especially when the income gap is as wide as it is today.
The average young white American, Booker says, enters into College with a net worth for $46,000; the average young black American, on the other hand, enters it with only $2,900 to his or her name.
— Urban Institute (@urbaninstitute) April 15, 2019
According to Booker, that makes it a lot harder for the impoverished to catch up with the wealthy, especially with the rising costs of college tuition and housing.
Baby Bonds, Booker believes, would “virtually close” that gap.
Today, white young people have 16 times the wealth of black young people. I joined @TheRevAl to discuss my baby bonds legislation, which would virtually close the racial wealth gap. https://t.co/XFTvWOqvI6
— Cory Booker (@CoryBooker) March 25, 2019
He says his plan would provide every child with a savings account that they cannot touch until they turn 18. Each year, the government would deposit an amount of money based on how much their parents earn.
According to CNBC, a family of four’s benefits, based on their income, would be:
Until the children come of age, the US Treasury would manage the accounts, giving the funds an expected 3 percent annual rate of return. By the time children at the lowest level turned 18, according to Booker’s estimates, there would be $46,215 waiting for them to help them on their way.
The recipients wouldn’t be able to spend that money on anything they want. They’d be required to go toward practical uses, with restrictions that would require them to spend it either toward college, buying a house, or saving for retirement.
Pundits say it’s a bold idea — even if it is one they acknowledge we’re unlikely ever to see in action. Booker is currently a dark horse in the 2020 election race; CNN‘s ranking of Democratic nominees only puts him as the 8th most likely candidate to end up on the 2020 ballot.
Still, Booker is pushing forward with what he believes is the right step for America.
“The gap in wealth between the richest Americans and the middle class has grown dramatically in the past 50 years,” Booker says. “Everyone in America should have a real shot to succeed.”
More to the story
KSL Newsradio’s Ethan Millard and Todd Fooks talked about this story while guest hosting the Dave & Dujanovic show, and Millard argued that the people who would benefit from Booker’s plan really don’t have the same opportunities that the rest of us enjoy.
“There’s something that these young kids are not getting,” Millard said.
Todd Fooks replied: “Maybe what they don’t have is hope.”
If you missed their conversation live on the air, you can still catch everything they had to say on the Dave & Dujanovic podcast.
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