Professors Suggest 'Baby Bonds' Could Fix Widening Inequality In The U.S.
What if every baby born in the United States was a trust fund baby? That's what two economics professors are proposing, that Uncle Sam provide each American newborn with a trust fund. The amount would vary depending on the parent's wealth, with an average of about $20,000. NPR's John Ydstie reports the professors floating this idea say it could help boost opportunity.
JOHN YDSTIE, BYLINE: Duke University professor William Darity Jr. says there's a huge wealth gap in the United States. He points out that the richest 1 percent of Americans hold nearly 40 percent of the nation's wealth. Meanwhile, nearly a third of Americans have no accumulated wealth outside the value of their home. And wealth gives you opportunity, says professor Darity.
WILLIAM DARITY JR: Wealthier families have the capacity to purchase homes in higher amenity neighborhoods. They have the capacity to provide their kids with higher quality education.
YDSTIE: And he says wealthier families have assets they can draw on to handle emergencies like the loss of a job or a serious medical condition, emergencies that can devastate families with no assets. Darity says there's often a bias against providing help for those struggling families because they're viewed as having been irresponsible or having made bad choices. That's why he says providing a trust fund for infants makes sense.
DARITY JR: You can't blame the infants for the condition that they are born into. And so let's do something about that when they have an opportunity to reach adulthood.
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