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U.S. Sen. Cory Booker, a Democrat from New Jersey, introduced legislation on Thursday for the federal government to create a $1,000 savings account for every newborn American baby.
Dubbed baby bonds, the U.S. government would contribute up to $2,000 every year depending on a family's income. In essence, they are annual federal "stimulus checks" for American children.
Booker's bond idea, first suggested during his failed primary bid for president, is aimed at reversing the growing tide of student loan debt. Recipients could begin withdrawing money from their accounts at age 18, giving them a savings account to tap for their college education, new car, downpayment on a home or to open their own small business, Booker has said.
The money would sit in a U.S. government account, earning interest, and might help narrow the economic gap between rich and poor, Booker said.
During the presidential campaign, the New Jersey Democrat said his idea could put as much as $50,000 in the bank for each child by the time they graduate from high school.
“In a country as wealthy as ours, every person should have access to economic opportunity and the chance to build assets and create wealth,” Booker said, according to NJ Advance Media.
Democrats now control both the House and the Senate, giving Booker's idea a stronger chance of passive in 2021.
Senate Majority Leader Chuck Schumer, a New York Democrat, said, “Giving our youngest Americans and their working parents an economic opportunity like baby bonds would deliver strong economic relief and mark an investment in our collective future,” according to NJ.com.
Gov. Phil Murphy has proposed a state-version of the "baby bond" plan as reported here by nj.com.
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