thank you for being here we want to start by talking about baby bonds the cover story which i wrote is this concept of baby bonds you came up with more than a decade ago let  s start by saying what is a baby bond and what is it designed to do   i am going to start with gratitude if you have not read that article yet the article is a parallel of my life with a policy proposal that was developed and now being thought about at statehouses across the country as well as at the federal level but ben his ability to capture the essence of me is personally gratifying i think extraordinary and my family they did not choose to have a public persona they were so proud of it it is meaningful for me and i really want to start with gratitude before we begin this talk what are baby bonds they are a birthright to capital simply by being born there will be a setaside amount of resource reserved for you that when you become a young adult you can have access to an endowment to begin a lifetime of building wealth building the economic security associated with wealth they are trust accounts the right to a trust account where it would not be reserved only for the wealthy but for everyone ben except the poor kids would get more money well why don  t you tell the story of how you came up with this and then we can talk about how they are designed dr hamilton as the article describes i had as some might say in a cliche form a tale of two cities i went to an elite private school in d downtown brooklyn and able to attend that school because of sacrifice and my parents being in over their heads what we talk about in the story is this is not a story about triumph because i lost my parents i lost my parents in my teen years for what i think is the result of stress nonetheless the exposed me to that education i could play football with my neighbors who i grew up with and i can go to brooklyn and play basketball with elite  the children of elite people and i could see they were not different but yet if we watch their trajectory one might end up robbing an armored car and the other could end up an investment banker the difference between those pathways was capital the difference between those two pathways were resources their parents had what this is proposing is a setaside amount of resources so that child who grows up regardless of whether they are black white or brooklyn heights can have a pathway toward economic security ben and this is really building on the decades of work you and others have done on talking about wealth and the racial wealth gap why are baby bonds a way to tackle the wealth race gap dr hamilton from a policy standpoint i like to describe them as race neutral in practice they are antiracist what makes them antiracist at this point we are pretty much all familiar with the racial wealth gap the racial wealth gap is dramatic such that the typical black family generally has about a dime for every dollar held by the typical white family and we are not talking about mean the mean differences are more dramatic the typical white family well the average white family has close to 1 million in wealth but we know that is not typical for most white families looking at the mean looking at differences between the experience of what happens typically across families white people have less wealth  far more wealth than black people and the result is not because of some effort or educational disparity but rather rooted in history we know a white assetbased middleclass never simply emerged it was federal policy it was the gi bill it was the homestead act when those bills were enacted although they may have seen facial race neutral it did not say black people could not be part of the homesteaders or could not get a gi bill but they were administered in a racial way they were designed in a racial way for example social security social security in its original form excluded domestic and agricultural workers what happened in 1930 the typical black woman who was employed 90 of them were employed as a domestic or agricultural worker for black men it was over half that was clearly a racist design so what baby bonds can do is they are not reparations they are not substitutes for reparations let  s be clear but what they can do is going forward they can ensure everyone has access to some capital to redress the historical disparities that have emerged they almost always become an automatic stabilizer an automatic stabilizer for your family who might be you know you can imagine being born into a family where you could have been  your parents could have been a doctor they get sued for malpractice their child would still need access to wealth even though at one point they might have been wealthy baby bonds become an automatic stabilizer that is counterintuitive for us policy usually we associate social mobility with one  s family this is saying that as a child irrespective of your gender race or the family position in which you are born you will have some setaside for you as a right so that you can reap the rewards of whatever ingenuity you have or whatever effort you might want to bestow ben in your original proposal you were thinking about 50000 to 60000 that the poorest kids would be able to access when they hit 18 or early adulthood this is an idea that is gaining real momentum and it is happening on the state level the states cannot afford 50000 to 60000 per kid but dc and connecticut implemented these things and they are basically starting with about 3000 and investing it and hoping it will be more like 10000 or more by the time they get to be 18 they are only focus on the medicaid eligible kids it is about half of babies born in connecticut and deceit good number of  connecticut and dc good number of children massachusetts new jersey we have legislators in new york mostly blue states really getting serious about this and they are doing pretty well financially right now just because of stimulus money and other things this is one place they are putting the money tell me how you feel about the political situation around baby bonds and the momentum it is getting are these state programs enough dr hamilton the state programs are a giant leap forward we don  t need to wait for the federal government we can start demonstrations at a local level we can build up momentum political momentum at a local level with the northstar is the federal government the federal government is the entity that has the capacity to ensure every child has a birthright to capital as you mentioned the biggest obstacle particularly on the state level is financed the capacity to seed that money especially when dealing with more emergency situations on a regular basis but the federal government has the finance capacity let me say something about the universality of it it is stakeholder society aspect whether you are born into the most wealthy family or the lowest wealth family you get a stake in our society just like social security that makes that program elegant but what you also need an addition to the universal aspect of everybody being eligible it has to be progressively seated if it is not progressively seated it is inflationary if you gave everybody the same amount at birth what you are doing is enhancing inequality those that have more will be able to add to their wealth portfolio and account pounded way also if you literally gave everyone the same amount you raise the price level for assets in a general way it is useful for it to be progressive ben what do you envision this money being used for you put some strings on this dr hamilton you know a lot people contrast baby bonds with guaranteed income or worse dare i say universal basic income i am not a fan for some of the reasons i mentioned i am a fan of guaranteed income i am a fan of the child tax credit simply by being a human being one needs income we have seen from some of the experiments that have been done at local levels the conservative critique that giving people money you will dissuade them from working you will discourage them from working the opposite occurred by offering people resources they were able to engage in more work they were able to overcome all types of circumstances that a state probably could not anticipate in order to be more employable similarly baby bonds is offering people resources and you might say well why restrict it why not use it for anything they want to use it for it is not intended to be paternalistic but it is intended to be specific for the goal of the program income and wealth are not the same income is necessary and useful but it is a flow good it is a periodic reward for some activity most americans get it in the form of labor but it can come in return for capital as well baby bonds is dealing with wealth which is perhaps a paramount indicator of economic security it affords you to go to a college an expensive college you want to went to finance that out of income if you are faced with the criminal justice system and you need to hire an attorney you are not going to be able to finance that out of income if you want to go into business you are not going to be able to finance that out of income wealth provides agency in one  s life the way income does not therefore baby bonds is not intended to be paternalistic but keenly focused on getting young people in an asset that would passively  and that is the keyword passively  rise over their lifetime like a home what is the difference between a homeowner and renter often a down payment what is the difference between a worker and a business owner i am being somewhat facetious but you can be a worker with all the ingenious ideas in the world if you don  t have capital to actualize that idea you are limited what baby bonds does is it redresses some of the exploitive and being able to extrapolate from people aspects of a market by shifting power to them by offering them wealth so they can in an authentic way have agency in their lives ben this is great i have been talking to legislators across the country about this idea and it is not just urban legislators that want to do this there is some broader appeal why do you think this idea is catching on and gaining some momentum dr hamilton i mean this is not about capitalism or socialism i am intentionally using the word economic right the reality is that for markets to work people need some power to engage in them if you enter a market with nothing you have nothing by which to bargain with you are simply at the whim of markets or the whim of charity i had a good friend that wrote an article about baby bonds and i love her title  an idea a conservative should love  if you are authentic about your belief in markets you would hope people would resource so they can go into that market and authentically bargain and trade in a way that can lift them up ben one of the quirks is out of rural areas that are represented by republicans in these places have lost a lot of capital and economic development the last decades that is one of the argument i kept hearing dr hamilton you are right capital flows will go into areas that have been depleted of capital i use the word automatic stabilizer it would be applicable here as well if you imagine areas that for various reasons might have divestments or loss of capital what baby bonds does in an automatic way is send resources in that area not just people geographies in that sense it becomes useful in fact we heard in the previous panel the discussions about being an american versus living in another society the idea of a birthright this should transcend borders you should imagine developing countries  if we want to be true to our humanistic spirit everybody should have some capital set aside for them for when they become an adult and be able to utilize it ben if you don  t mind talking a little bit more about where you are coming from growing up in bed brooklyn the profile we did of you you really did not like the rags to riches story you didn  t want to be seen as inspirational or an inspirational s success story why is that dr hamilton we cherry pick we pick examples of successful cases and what we don  t do is all the other evidence of systematic evidence so people that did work hard that did study hard were not successful those anecdotes are inauthentic if you look at my own personal case  i say this in the article  i would rather have my parents if i had the choice at 18 of having access to pathways that could lead me to be a professor through that expensive brooklyn education or have them i would  ve made a different choice but that choice was not afforded to me that is the tragic choice they made and that is the tragic choice millions of families are having to make when we ask them to be superhuman everybody cannot be above average lebron james in a commercial one time pointed out you know i get this narrative of coming from a humble beginning and making it in this nike commercial he said i want to live in a society where there are no more humble beginnings and that is what i want i don  t want humble beginnings if we want to have true competition if we want to have true human rights we need to eliminate humble beginnings ben we have a couple of more minutes but that is a wonderful place to end really appreciate you coming in and sharing your wisdom with us and sharing your thoughts for the bloomberg story dr hamilton thank you ben thank you a lot applause