Baby Bonds

Baby Bonds

Listening to The Takeaway this morning (6-7 A.M. here in our west coast town), I heard a new idea for bridging the growing income inequality in this country.

Darrick Hamilton from the New School was interviewed. He and William Darrity (Duke) published an article, “Bold Policies for Economic Justice,” laying out their concept. I’ll paraphrase:

The greatest cause for the ongoing disparity of opportunity for minority groups is the lack of inter-generational wealth. Well-off young adults (predominately white) receive money from their families—as gifts, loans or inheritances—and use this to build future wealth. Poor families do not have this advantage.


Hamilton and Garrity’s idea is for the government to create Baby Bonds, an endowment put aside for each newborn, which grows to maturity with the child, free of the parents’ finances, and is available to start a business or for a down payment on a house—the building blocks of asset development. The poorer the child, the larger the endowment, but they recommend $20,000 for the poorest, which would grow to $60,000, at a government insured rate of 1.5%.

As the playing field is leveled, Hamilton said, Baby Bonds will decrease the dollars needed for other government-supported programs for the poor.

7 responses »

  1. Money is not the only thing that economically stable families give their children. They often afford advice and a good example about the use of money. Without that, a novice can blow through money very quickly. I generally don’t think that 21-year-olds know how to use money very well, and a lot of us need to learn about how to make money work for long-term gain. Money management is not part of our school curriculum and I think it should be.

  2. Sondra Alexander

    Learning about money management at a young age is a really good idea along with the baby bonds which is about time, an updated 40 acres & a mule

    • harriet gleeson

      Well, I’m no economist, but this sounds sensible and good. Pity the pols.
      don’t necessarily go for sensible and good..

  3. Brilliant idea. I think it should include a few years of travel to other countries, a year in the peace corp or the humane society and a wardrobe and vehicle. AND the moola.

    • Hmmm, what are these people smoking? Since our country is nearing $17 TRILLION in debt where is this money coming from? LaLa land of course…you sound like our Congress!

  4. Norma,

    What are these guys smoking?  Our country is nearing $17 trillion in debt and they want to do what?  God help us if they decide to run for congress. With our gimme gimme generation they would probably win.

     I came from a poor family…10 children abandoned by their father in the midst of the depression.  All my older siblings went to work to help feed the little ones. They worked hard all their life and never went on welfare. I was a single mother at 27 with four kids and no education. JFK had put in a educational program which I applied for. I went to business school and learned skills to help  me get a job.  I lived with my sister in a two bedroom, one bath house in Lynwood with my four children. Poor sister. It was a nightmare for us all but I did it!  And she did it.  Upon graduation I got a job as a secretary making double what I did working as a receptionist in a hospital. I raised my kids alone with no financial support from my husband.  It was the hardest thing I have ever done. There were times when I thought I couldn’t make it…but, the thought of going back to my husband gave me the strength to go on.

    I raised four wonderful, self-supporting children.  Chris went to college in a wheelchair,and had a very successful career as a photographer Nancy graduated from college and became an incredible teacher. She worked her way through college by waiting tables one semester and going to college a semester. It took her longer to graduate, but she graduated.  Karrie loved gardening and started her own landscaping business. She raised two sons alone. Her son graduated with a civil engineer degree while the other one joined the  navy.  My youngest son, Scott did not graduate from college but he’s smart. He holds a position that requires college degree with the salary of one. 

    The way I see it, people just don’t want to work.  Egads! why work when the government will support you.  The more illegitimate babies one has, the more money she gets. She in turn raises her children with a welfare mentality…and the beat goes on.

    Our country is in dire trouble and dribble such as this sends me into orbit.  And, now you know how I feel about this in as few words as I could use. 🙂    




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