Cory Booker Unveils New Proposal Aimed at Closing Racial Wealth Gap
Households of color have only a fraction of white households’ wealth -- median Black and Latino households that own just $3,400 and $6,300 in wealth, respectively, compared to $140,500 in wealth owned by their white peers. The Beat DC yesterday reported on the proposal from Senator Kamala Harris (D-CA) to repeal Donald Trump’s tax cut and give back to the middle class. On Mondy, another rumored 2020 presidential contender, Senator Cory Booker (D-NJ), released his own plan -- the American Opportunity Accounts Act. The newly introduced legislation will help level the wealth-building playing field and ensure that all children, especially those who come from low- and moderate-income families. He says his plan, which would be administered by the Treasury Department, would provide approximately four million children born each year with an American Opportunity Account seeded with an initial $1,000 deposit. Each year, until the child turns 18, their accounts would be boosted through additional, automatic yearly investments of up to $2,000 deposited directly into the accounts. At age 18, the funds could be used by the child to invest in wealth-building opportunities, such as a higher education or homeownership. For children who come from the most financially vulnerable families, the American Opportunity Accounts Act would provide them with the greatest wealth-building support. For example, by the time they turn 18, the American Opportunity Accounts Act would provide low-income children with as much as $34,000 in investments. And because the legislation’s automatic enrollment feature would allow those investments to grow to their maximum potential, this initial $34,000 would grow to be more than $45,000. “It would be a dramatic change in our country to have low-income people break out of generational poverty,” Booker said. “We could rapidly bring security into those families’ lives, and that is really exciting to me.” More here.