Connecticut Has Found a Novel Method to Close the Racial Wealth Gap

More than two years after then-presidential hopeful Cory Booker floated the idea of baby bonds—a program that would give each child born in the U.S. cash in a savings account that they could then draw upon when they turn 18—as a way to help close the racial wealth gap, Connecticut is about to become the first state in the country to create its own baby bond program. {snip}

Unlike Booker’s plan, which was based off of a proposal by the economist Darrick Hamilton, Connecticut’s baby bond program will be solely targeted to low-income families. More details, via the Hartford Courant:

Beginning July 1, babies born to low-income mothers who rely on Medicaid insurance would receive $3,200 in a special savings account under the $600 million Connecticut Baby Bond Trust program included in a bipartisan state bonding bill.

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Connecticut’s Democratic Governor Ned Lamont is expected to sign the legislation into law. {snip} As the Connecticut Mirror noted, while the program will benefit all children born into poverty, it will have its largest impact on Black and Latinx children and families in the state.

Connecticut state treasurer Shawn Wooden, who championed the program, described the baby bonds as a way to help reduce, as he put it, “the wealth gap and economic disparities [that] have only been exacerbated as a result of the pandemic and have disproportionately impacted communities of color.”

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Hamilton, the New School economist who pitched the idea of baby bonds at a conference in 2018, commended Connecticut for taking action. {snip} And while more states should continue to implement similar programs, to truly use the idea of baby bonds to help close the racial wealth gap, the federal government needs to act. {snip}