New Report Proposes Bold Solutions for Fighting Wealth Disparity
|thenorthstar||Apr 26, 2019|
A new report from the Institute for Policy Studies proposed 10 “bold” solutions to the complicated, persistent, and entrenched racial wealth divide. Trends show that the racial wealth divide, which is greater today than it was nearly 40 years ago, will continue to widen, according to the report. The report’s four authors--Chuck Collins, Darrick Hamilton, Dedrick Asante-Muhammad, and Josh Hoxie--outlined 10 solutions to this issue in three categories: programs, power, and process. The authors said that each solution was “rooted in a public policy shift that can have a structural impact across society.”
Topping the list were baby bonds, as well as guaranteed employment, and increases to the minimum wage. The report proposed investing in affordable housing, Medicare for All, postal banking, significantly raising taxes on the ultra-wealthy, righting upside-down tax expenditures, creating a congressional committee on reparations, improving data collections on race and wealth, and a racial wealth audit.
“Implementing the policies in this report are essential to balancing the historical injustices that created the racial wealth divide in a manner that is universal but race-conscious,” Darrick Hamilton, report co-author and executive director of the Kirwan Institute for the Study of Race and Ethnicity at The Ohio State University, said in a statement to The North Star.
Report co-author Chuck Collins told The North Star that none of the proposals would solve the issue of the racial wealth divide alone. Collins said the proposals were part of an “ecosystem of ideas” that, together, could bridge the divide. Democratic presidential nominees have embraced many of these solutions. Collins told The North Star that it would “appear” that Democrats are more willing to enact proposals that would bridge the divide than the president.
Collins said that the report’s authors hoped to “lift” the idea of baby bonds because it isn’t as widely known. One of the baby bonds programs the authors examined was that of Senator Cory Booker (D-N.J.). According to Vox, Booker proposed giving newborns $1,000 and then adding up to $2,000 annually for children in low-income homes. That would average a nest egg of about $46,000 by the time children reach the age of 18.
Columbia University postdoctoral researcher Naomi Zewde has researched the effect baby bonds would have on the racial wealth gap and found that the divide between white young people and Black young people would close significantly. Zewde estimated that in 2015, the median white person aged 18 to 25 had a net worth of $46,000 while the median Black person had a net worth of just $2,900 — a ratio of 15:9. She estimated that baby bonds would “dramatically” close that divide to just 1:4.
Meanwhile, Senator Bernie Sanders (I-Vt.) is perhaps the best-known proponent of Medicare for All. Sanders proposes replacing private insurance, Medicaid, Medicare and the Affordable Care Act under his version of Medicare for All. The proposal by the Democratic presidential hopeful would call for a single, national health insurance program that would cover everyone in the US, according to PolitiFact. Fellow Democratic presidential contender Senator Elizabeth Warren (D-Mass.) is a big supporter of raising taxes on the rich. In her latest policy proposal, Warren suggested taxing the ultra-wealthy in order to slash student debt for Americans around the country.
Warren’s plan involves forgiving $50,000 in student loans for Americans in households earning less than $100,000 a year. That would represent student loan relief to more than 95 percent of the 45 million Americans with student debt, her campaign claimed.
The plan would cost $1.25 trillion over 10 years. In response, Warren’s wealth tax proposal, a 2 percent tax on wealth above $50 million and a 3 percent tax on incomes above $1 billion, would pay for the debt relief, CNN reported.
Collins said it was important to know that the racial wealth divide is due to systemic, historical differences. “We want to fix that,” he said. “We could totally fix [the divide] in one generation [and] it would be good for the economy.”
About the Author
Nicole Rojas is a breaking news writer for The North Star. She has published in various venues, including Newsweek, GlobalPost, IHS Jane’s Defence Weekly, and the Long Island Post. Nicole graduated from Boston University in 2012 with a degree in print journalism. She is an avid world traveler who recently explored Asia and Australia.