Sen. Cory Booker (D-NJ) and fifteen other Democratic Senators want to give $1,000 to every American child every year until they reach adulthood.
The American Opportunity Accounts Act — reintroduced by Booker in January — would give each American child $1,000 in “Baby Bonds” at birth. Depending on household income, the child’s interest-bearing account would receive up to $2,000 annually, which could be accessed at age eighteen for buying a home, starting a business, or paying for college.
While children from disadvantaged families could see their accounts reach nearly $50,000 in value, children from wealthy families would only end up with a total of $1,600 by their eighteenth birthday.
In a country as wealthy as ours, every person should have access to economic opportunity and the chance to build assets and create wealth. That’s why we need to pass Baby Bonds which would help level the playing field and close the growing wealth gap in our country.
— Sen. Cory Booker (@SenBooker) June 10, 2021
As CNBC reports, the plan could cost the federal government between $60 billion and $80 billion.
Among the bill’s cosponsors are Majority Leader Chuck Schumer (D-NY), Sen. Dick Durbin (D-IL), Sen. Bernie Sanders (I-VT), and Sen. Elizabeth Warren (D-MA). Similar legislation in the House is endorsed by Rep. Rashida Tlaib (D-MI) and Rep. Ayanna Pressley (D-MA).
“To truly ‘build back better’ our economy, we cannot ignore the extreme and persistent wealth inequality that deprives kids of economic opportunity right out of the gate,” said Booker in a press release. “Baby Bonds will start to level the playing field. In a country as wealthy as ours, every person should have access to economic opportunity and the chance to build assets and create wealth.”
“The racial wealth gap in my district and across the country is stark and only getting worse, exacerbating inequities and denying far too many people of color an opportunity to thrive,” said Pressley. “These disparities are the direct result of generations of policy violence exacted against Black and brown communities, so we must be every bit as intentional in advancing policies that center racial and economic justice — policies like Baby Bonds.”
Booker likewise stresses the racial impact of his legislation.
It’s past time we make meaningful strides toward closing the racial wealth gap in this country. Baby bonds can help get this done. pic.twitter.com/qTFhS01RZl
— Sen. Cory Booker (@SenBooker) March 3, 2021
The “Baby Bonds” proposal — which Booker wanted to include in the American Rescue Plan — is one of many Democratic policy proposals that would increase the federal government’s involvement in children’s lives.
Most recently, President Biden’s American Families Plan proposed $426 billion for universal pre-kindergarten and $493 billion on family and childcare initiatives, as well as $299 billion on free community college and $117 billion on other education projects.
The American Rescue Plan created a “Child Tax Credit” through which most American families will earn at least $250 per month.