The $60 billion plan to give every American baby $1,000 at birth
Andrea Miller, CNBC.com associate producer
The racial wealth gap between white American families and Black American families is, well, it's more of a chasm than a gap.
U.S. Sen. Cory Booker, D-N.J.
We have a real wealth crisis in the United States of America. The wealth gap continues to spiral larger and larger in this country while you see a lot more people being trapped, unable to create wealth, which is economic security, which can be passed down to generation to generation.
Andrea Miller
In 2019, the median household wealth for white families was nearly $190,000, almost eight times higher than that of Black households.
Cory Booker
If we don't do anything, it will be many generations, literally 100, 200 years before you begin to see that racial wealth gap closed.
Andrea Miller
There's are few ideas and potential policies meant to combat this very problem. One of them is baby bonds. Under this kind of policy, the US government would deposit money into interest-bearing accounts for every newborn baby.
Naomi Zewde, Assistant Professor, City University of New York
It should actually be called baby trusts more accurately. Baby bonds has a nice consonance to it.
Andrea Miller
A baby bonds program could cost the US government anywhere between $60 billion and $80 billion dollars.
Cory Booker
This is an idea to help more Americans have pathways to wealth.
Andrea Miller
Conservative policy experts argue that baby bonds could reduce incentives to save or to pursue education.
Aron Szapiro, Head of policy research, Morningstar
It is not a silver bullet. It does not solve the racial wealth gap. And I suppose you really have to believe in the power of this money to change people's life trajectories at age 18.
Andrea Miller
According to an analysis from investment for Morningstar, Senator Cory Booker's baby bonds proposal, the American Opportunity Accounts Act could reduce the racial wealth gap between white and black households by 40%, if passed.
Lia Mitchell, Senior Policy Analyst, Morningstar
As kids reach age 18, get access to this money, they'll have more funds to help them plan for their future. But will it actually do that? And to what extent will it do it?
Andrea Miller
Here's how baby bonds work.