The Congressional Democrats reintroduced a bill that would create a $1,000 Baby Bonds Bill for every American when they are born, setting up savings accounts that individuals will not touch until adulthood. It's one of many measures introduced by lawmakers to fix the wealth inequality and extend the federal government's child benefits.
Under the Baby Bonds Bill, which is led by Sen. Cory Booker (D-N.J.) and Rep. Ayanna Pressley (D-Mass.), someone born after Dec. 31, 2021, has an "American Opportunity Account" set up for them when the government pays them with $1,000.
The savings account will accrue about three percent interest, and when the child turns 18, the federal government will deposit up to $2,000 per year in the budget. In other words, if the child is below 18, he is not allowed to withdraw money from the account saved for him.
The sum deposited depends on the household's income level, and homes would not receive any extra funds if they make up more than 500 percent of the poverty line, which for a family of four will be around $131,000 in 2020.
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All of them Democrats, including Senate Majority Leader Chuck Schumer, have already endorsed the bill around fifteen senators. Depending on household income, it proposes to build and grow a savings account of $1,000 at birth, with additional deposits of up to $2,000 (£1,460) per year.
"The funds will sit in an interest-bearing account, which can be accessed by account holders at age 18 for allowable uses like buying a home, paying for educational expenses, or starting a business," said Schumer in a statement.
It is not Booker and Pressley's first effort to push the bill. They also proposed it in the 2019 Congress session, but it failed to gain much support.
Booker said in a statement that to build back better our economy truly, we "cannot ignore the extreme and persistent wealth inequality that deprives kids of economic opportunity right out of the gate" end of quote.
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The Baby Bonds Bill is gaining support
Booker said there was growing support for the proposal, as for the 15 senators who co-sponsors in it, although they are all Democrats. But Booker said he was still hopeful that the bill could be approved and signed by President Joe Biden by a Democrat-controlled Congress.
Aside from Schumer, other senators who co-sponsors the Baby Bonds Bill include Sens. Kirsten Gillibrand (D-N.Y.), Elizabeth Warren (D-Mass.), on Bernie Sanders (I-Vt.) and Amy Klobuchar (D-Minn.), all of them run in the national Democratic Presidential last 2020.
Last year, a bill that is close to the Baby Bonds Bill was endorsed by New Jersey Gov. Phil Murphy. With the same idea to give $1,000 to every child born in New Jersey with a certain income level reached by their families. The draft did not make it into the final budget.
The Baby Bonds Bill proposal of Booker's has quickly become his centerpiece in the campaign. Positively, the bill would precisely provide every newborn child in America savings. And for most people, it will mean more money will be added in each year.
Booker lags behind presidential hopefuls Bernie Sanders and Joe Biden in the polls, but his call to offer a savings account to every American has been lauded for its clarity and possible efficacy in reducing racial wealth disparity United States.
