Roberto Germán [00:00:01]:
Welcome to our classroom.
Hey.
I am excited because I have a group of amazing individuals and I've been trying to set this up for a while. We've been doing work behind the scenes to make it happen because these folks are on the ground, busy, trying to push important matters forward. Not that my other guests are just sitting back idle, but I typically do not do interviews where I have so many people because it becomes a challenging coordinating schedule. But here we are. We made it happen, and I am so glad that we did, because we have an important topic to discuss today. We are going to get into talking about baby bonds, talking about the needs in our community and of course talking about inequality and wealth disparity and how it is impacting brown folks all over the United States. But also what it is that we can do about it. How it is that folks in different sectors are working to push things forward. And today we have Dr. William Sandy Darity, who spent a lot of time working in this area trying to solve the wealth inequality in the United States. And so he's going to be sharing. And we have Alejandra Montoya Boyer, and we have Sergio Munoz. And we have Abigail Golden, Vazquez. You call Abigail, or you could call it Abigail. Either way, it's acceptable. But Abigail got something has a flavor to it. All right, so we're going to oh, thank you all. Thank you all for being here and for our audience. Just so you know a little bit more about these folks, all right? These aren't regular Smegala people. These are folks who are doing big things. Dr. Darity is the Samuel Du Bonds Cook Professor of Public Policy, African and African American Studies and Economics, and the director of Samuel Du Bois Cook Center on Social Equity at Duke University. He has served as the chair of the Department of African and African American Studies and was the founding director of the Research Network on Racial and Ethnic Inequality at Duke. Sergio Muñoz, who has joined me before, so you've heard his voice. All right, he's back again. My friend, the Mexican banker who is in La. Has written eleven books, 550 essays published throughout the Americas, and has produced radio broadcast shows and is doing amazing things in the banking world. Serial is currently in production on an original series on Latino Latina prosperity. And so thank you for being here once again, Abigail Golden Vasquez Senior Fellow, Strategy and prior to that, prior to joining Prosperity Now, where she's at, served as Vice president excuse me. And executive director of Latinos and Society program at the Aspen Institute. Conceptualized and stood up on a new policy program to increase awareness of the growing significance of American Latinos to the future of the US. As part of the Aspen Institute's overall effort to foster leadership based on enduring values and to provide a nonpartisan venue for addressing critical issues facing Latinos in this nation. And Alejandra Montoya Boyer is the Director of Policy at Prosperity Now, where she oversees the development and implementation of federal, state, and local policy that seeks to improve economic opportunity for BIPOC and low income families and communities. Welcome to all of you. Thanks for being here. Listen, we're going to go ahead and get started because there is so much to learn from you all. And so why don't we go ahead and start with Dr. Darity just sharing a bit about the pedagogy and history here as it relates to baby bumps.
Dr. William "Sandy" Darity [00:04:40]:
Well, I'll try my best to tell the story as I remember it. I think circuit 2008 or 2009, derek Hamilton and I were particularly concerned about the evidence that the Obama administration was not going to make any type of commitment to do something that could be identified as being specifically for black people. And ultimately, I think the only major project that could be described as being specific to black people that the Obama administration pursued was my Brother's Keeper, which, from my standpoint, is a particularly fraught type of project. But that's another story. But at the beginning of the Obama administration, we reached the conclusion that if anything was going to be done to address racial wealth disparities in the United States, it would have to be done from the standpoint of designing a universal program that might have a disproportionate benefit for black Americans. And so that's how we came to thinking about this idea that you could provide every newborn child in the United States with a trust account that was calibrated on the basis of their family's net worth or wealth position. And that was the origins of the idea of a baby bonds proposal. It was different from some other types of plans that were already extant that people typically refer to as child savings accounts because we designed it intentionally to not have parents make contributions or grandparents make contributions into the fund, that this would be a purely publicly provided fund that would be available to every newborn infant in the United States. And in addition, the notion that the amount of the fund would vary with the family's net worth position was a sharp departure from many other types of initiatives to set up some sort of initial asset for newborn infants. We focused on the idea of giving this to infants because we thought that that would preempt the claim that the individuals themselves might be responsible in some way for their disadvantaged economic status. But there's nothing inherent in the proposal that makes it exclusively designed for newborn infants. You could just as well just set up the program so that young adults could receive it, particularly young adults that have newly formed families. There's any number of options. Let me say, though, that one of the critical aspects of the proposal, and it was something that I wasn't as sensitive to at the point at which we began to develop it is that it will not eliminate the racial wealth gap. And a lot of people do argue that it would. But the best case scenario for it having a significant effect on the racial wealth gap is if you measure the racial wealth difference at the median rather than the mean. And so to make it clear, if we are to focus on the racial wealth gap by looking at the middle black household and the middle white household or the middle Latino household, we come up with a very sharp difference in the estimate of the amount of the gap. So let's take the black white comparisons for simplicity. If you look at the median black and white household the difference in net worth estimated on the basis of the Survey of Consumer Finances from the Federal Reserve would be about $164,000 per household. But if you look at the mean differential, what we traditionally think about intuitively as the average, the mean differential would be $840,900. So I did some estimates of trying to determine what the impact of a baby bonds proposal might be depending upon which measure you use. And you have to keep in mind, of course, if baby bonds are distributed to newborn infants and they only receive access to those funds once they reach young adulthood, you really do have to talk about some period of 30 to 40 years beyond the inception of the program to see its full effects. And so if you're thinking about that period 30 to 40 years down the road, estimate that if you look at the median gap between black and white wealth, you could reduce it by as much as 74%. However, if you look at the mean gap, you reduce it by some figure that's closer to 20% to 25%. So there's a substantial difference in the impact. Now, one final initial comment because I don't want to monopolize the conversation, but there is a reason for using the mean measure as the disparity measure for wealth between social groups. That is a superior measure to using the median customarily. People think, well, you should use the median because the middle households are more representative of the typical experience of most members of the social group, particularly since that middle value is not affected or contaminated by outliers on either end of the distribution. But in the case of thinking about wealth inequality between social groups, especially in the US context, it becomes important to focus on the mean instead. The reason for this is it's because the concentration of wealth in the United States is so skewed. 97% of the wealth that is held by households in the United States is held by those that have a net worth above the middle, above the median. So it's only 3% of the nation's wealth that is held by households at the 50th percentile or below. So if you were to try to look at black white differences and focus on the median, you would end up ignoring vast amount of the wealth that's relevant to the comparison or the relative position. Let me conclude by saying that this huge concentration of wealth at the upper end of the distribution is not exclusively due to the fact that there's a handful of white billionaires. Indeed, there is a handful of white billionaires, but that's not the reason. 25% of white households have a net worth above $1 million. And this is true for only 4% of black households. I would argue that you really do have to pay attention to the mean gap. And unfortunately, if you focus on the mean gap, baby bonds is not as efficacious, but it is a wonderful proposal for mitigating the extremes of wealth inequality in the United States. And that's why I'm a fervent advocate of the project.
Roberto Germán [00:12:44]:
Thanks for sharing that context matters. That's data that probably the average person doesn't know. When you mentioned that 97% of wealth is held by households above the median, along with a lot of the other data points that you mentioned. And you were saying earlier, you mentioned that parents would not invest in this because it would be a public fund, which then got me thinking, like, SETI, I'm interested to hear your perspective as a banker, given that folks wouldn't be investing this. It's a public fund. How does that sound to you? And how is this sustainable? How can we transfer this?
Sergio Muñoz [00:13:26]:
Oh, boy. That's a tough question for me to answer, Roberto. I was coming at this from a drastically different perspective.
Roberto Germán [00:13:38]:
Let's hear it.
Sergio Muñoz [00:13:40]:
So forgive me if I twist a little bit right here with Dr. Darity's work. This is going on past a decade. Right, Sandy?
Dr. William "Sandy" Darity [00:13:52]:
Yeah, yeah.
Sergio Muñoz [00:13:55]:
We're at a point now where it's gaining traction. It's gained traction in DC. And California and Connecticut. In Massachusetts. They talk about this a lot. Before I would go to the question that you posed, which is how contributions would work. I was really looking more from the educational perspective of how do you educate a public, be it black, Latino, indigenous, on the type of complicated work that Sandy does as an right. Like, even even just the description that he gave prior to me speaking. When you start to go into means and medians and all that, how do you explain that to a child that's not prepared for that type of economist.
Roberto Germán [00:15:02]:
Language or even to the adult community that's not necessarily using that language on a day to day and may not have an understanding of mean versus medium?
Sergio Muñoz [00:15:17]:
I break this out into three different ways of understanding it, all right? Which is, one, understanding baby bonds, period. Like, just the concept of it. Secondarily is like, if it were to go into effect, who's going to be compounding the bond? And then the third, which is arguably probably the most complicated, which is spending the fund. Right. Like, one of the wealth building activities that they mentioned is business and that we could get into a whole discussion on venture capital and how complicated it is to start and maintain a so. I haven't gone that far, Roberto, on even the contributions. There is to your point, though, and Sandy can talk about this is there's a really interesting dynamic that Sandy was pushing originally with his proposal, which was that the parents or the grandparents, I imagine, wouldn't be able to manage the baby bonds for the children for very specific reasons, a lot of reasons. And so I would sort of move to that a little bit and push it back to Sandy as to the why of that.
Roberto Germán [00:16:56]:
Yeah, if you could elaborate a little bit, Sandy, on that aspect.
Dr. William "Sandy" Darity [00:17:04]:
Yeah, actually, there could be an educational dimension to this project because the young people would not receive the bonds until they reached 18 years of age, or in some formulations, 21 or 24 years of age. So there would be an opportunity to provide them with various forms of financial management training, which they might actually have an incentive to pay attention to, knowing that they were going to receive somewhat of a significant asset later in their lives. But the premise behind excluding the parents from having any significant role in this process, which does raise questions about how you address family well being during the period before the child actually is eligible to receive the funds. But the premise here is that we did not want to have any kinds of complaints that there could be interference or mismanagement on the part of the older generation. That in some sense, this is a set of funds that would be protected through a centralized government agency for the purposes of being distributed to the young people when they reach the relevant age of majority. The other thing here is something that Sergio mentioned which is really important, which is the question of whether or not the funds should be designated for specific purposes or whether the young people can use it for whatever in the world they please. And that's been something that's been somewhat of a sensitive debate between Derek and myself at the point where we were formulating this because I was inclined to be non paternalistic and know they could use it for whatever. And he was more inclined to say, well, I look around and I look at stupid decisions that teenagers make, and so we ought to restrict it to either home ownership or educational purposes or business development purposes and the like. And from my standpoint, I'm open to having that conversation still. But I think that that's a really important question that Sergio has just raised.
Roberto Germán [00:19:37]:
Yeah. And it's a good opportunity for you to chime in as we're thinking about messaging to the community.
Abigail Vazquez-Golden [00:19:45]:
Just let me say it's an honor to be on this panel in this discussion with Dr. Darity, a founding father of this incredible legislation as well as every other person here and my dear friend and colleague Alejandra as well. And she's got a lot to say on the policy side. Yes. So about communicating around baby bonds or really any other policy or legislation that impacts Latinos and other communities of color, I think we need to recognize specifically when it comes to Latinos, we are not a monolith. We come, as I always say, in every shape, color and size, every flavor. Cara savor. We don't all speak Spanish, some of us speak only Spanish, some of us are bilingual, some of us have been here for know centuries before there even was a United States and others have come more recently. We represent all kinds of countries across Latin America and the Caribbean. So I'm saying this because we are so diverse. And so I truly believe that targeted messaging is essential and I'll get back to that later in terms of trusted interlocutors and strategies for doing that. But while I'm talking about all of this diversity, there's also commonality and there are messages and messaging that resonate across and I would say across all families and households but there is a very specific and heavy emphasis on la familia in the family, in our communities, across all the difference. And that is definitely not to say that's not the case in other communities. That is not what I'm saying. But that I think is a real critical messaging hook. And so when you're talking like how do you help families understand the great potential that this legislation has and to ensure that they are equipped to be able to take advantage of this? And as Dr. Darity was saying before that if there are any requirements about courses that need to be taken or how to manage this money successfully when they finally have it in their hands, this has to be done in a targeted fashion through trusted interlocutors. And some of those are organizations like CDFIs, community financial development institutions which are already in community and already working directly with folks and are trusted and know how to communicate these messages. I wouldn't be in this forum if I weren't to talk about the importance of schools and education. That's a great opportunity. And education is another really important pillar for Latino communities. It's seen as a mechanism for advancing and so there's a lot of trust put into teachers and to educational institutions. Despite the fact that they have failed us at times, it's still a very respected and important institution. Churches, these are all places I think that we can go to to try to get these messages. You know, Alejandra is one who really taught me about there's one thing to do policy, it's another thing to ensure that people can actually benefit from that. And so that's where this education piece comes in, is ensuring that we are targeting the messaging to the communities in the language that they are going to hear it. And when I say language, I don't just mean I mean, you know, if you're in, you know, using those terms and that language, that's going to resonate versus maybe if you're in Texas or California or New Mexico or where, you know, in so, you know, really targeting to your audience, very specifically tailoring your messaging and messages. So I'll leave it at that, and then I'll let Ali expand.
Roberto Germán [00:24:09]:
What should the average person that doesn't know much about this be paying attention to? How can we benefit from being more engaged as it relates to knowing what policies to advocate for? What are you doing at Prosperity now? Or what is Prosperity Now doing as an organization to help move things forward?
Alejandra Montoya-Boyer [00:24:33]:
Yeah. So I'll jump in and start with kind of why this matters for Prosperity Now and the approach that we're taking to this, recognizing I'm going to start with we're trying to solve racial economic injustice, system and wealth inequality that has existed for nearing 500 years. These are things that we're undoing. And so solving through policy, there's no silver bullet. There's no one policy or even a handful of policies that are going to fix all of this. And to Dr. Darity's point, baby bonds is a fantastic proposal, but it is one of many things that we need to be able to completely resolve and solve these structural challenges. So as excited as I am about the work that I do, the proposals that we move forward and turn into policy, these are things that will take decades for us. And, I mean, there's just a lot of work to do. So I want to start there, mostly because I'm a little bit of a pessimist, but I'm working through that, and I'm going to bring an optimist approach to this conversation. I'm going to start with another data point as well. To add to dr. Darity's, I apologize. It's in the median and not the mean. So as we just heard, there are some limitations with the way that that data is depicted. But black households have $0.12 for every white dollar, and Latina households have $0.21 for every white dollar. So if we're looking at some kind of bare minimum ways to cut wealth mean, that's pretty massive. And so when we looked at the policy proposal that Dr. Derek Hamilton put together around baby bonds, prosperity now is really trying to see how do we actually turn these proposals into policy and then know, go through the legislative process and then implement them. So at the federal level, prosperity now has worked with Senator Cory Booker, who introduced the American Opportunity Accounts Act, which is the legislation that would actually put a national baby bonds program together. We've worked with him for several years now. He reintroduced it this year with Representative Ayanna Presley and the House side. And in its current iteration, this is what it would do upon birth. Every single child of the 4 million babies that are about 4 million babies that are born in the United States would receive $1,000 into an account and then every year based on income. So really targeting with an income based approach targeting the lowest income families, dollars would be invested back into the account from the government. As Dr. Darity said, this is specifically a public investment into these accounts and that would grow over the course of the 18 years. Estimates with those initial accounts for the lowest income families would amount to about $34,000. With the growth on those bonds, it would actually look like probably $45 to $46,000 at 18. So if we're looking at the affordability crisis on post secondary education, housing, starting a business, we know that $45,000 is not going to solve the problem, but $45,000? As an 18 year old, I mean, I can tell you as someone that went to overpriced college with not the resources available that I would have liked to have had and am now swimming in student debt, it would be fantastic to have had $45,000 to put toward my education, to put toward buying a home and the specific purchases or ways that we can spend the money. And Dr. Darity, I agree with you. We can definitely talk about that, have that conversation. But right now, the legislation is specifically targeting purchases that are considered wealth building opportunities. There is a return on investment that would grow into hopefully not just individual wealth, but generational wealth through homeownership, post secondary education, starting a business, sometimes retirement. So that's the federal program. We've heard talk about the state programs that have already come up. Most notably, Connecticut was the first state to pass a state program. It functions very similarly to the federal program, though I will put the caveat that it is a much smaller amount of money just given the fact that the state of Connecticut has nowhere near the resources that the entire United States have. So kids born in July are the first this year are the first round of kids that are going to be able to access these funds. And the estimation is that by on turning 18, they'll have around $12,000 to put toward those same wealth building opportunities. So these are policies that, like I said, they are attempting to really shift the way that we are starting out, letting the next generation start out on a more even playing field. It is not going to be able to solve full wealth inequalities or as we said, close the racial wealth gap, but it is trying to even that playing field so that kids, young adults starting in college are entering that stage of their life on a more similar playing field to white kids. And so recognizing that, recognizing that these are public investments. Back to the question for Sergio. Part of our perspective from Prosperity now, why we don't want parents and grandparents investing is not just because of some of the financial issues, but also recognizing we're trying to close gaps. If there are families that have more money to be able to put into that account, it could actually exacerbate gaps knowing that the lowest income families don't have added savings or added resources to be able to target savings. So from our perspective, the goal really is to iterate and innovate on these policies, knowing that baby bonds is a fantastic program if implemented. But how can we connect the dots between baby bonds, a future investment, toward what do families need right now? What can we do with guaranteed income, with expanded child tax credits, with housing needs? Like knowing that there's a full body of policies and programs that families will rely on to truly be able to make a meaningful dent in a wildly uneven playing field right now. And so for us, that's really what we're coming and approaching baby bonds with.
Roberto Germán [00:31:27]:
Yeah, I think that's critical. I mean, to think about the possibility of an 18 year old receiving thousands of dollars and I know you mentioned Connecticut fine, it's not 45,000, but to receive 510, maybe 15,000 upon turning 18 to invest in your education, to maybe use as a down payment for a home. I mean, with the housing crisis, that even sounds like small money with everything that's going on now. Right. But then again, when you think about all of the programs that are available, things that could help folks get a leg up, first time home buyer program, things of the sort. And a lot of this we mentioned this earlier as it relates to messaging in the community, a lot of this does come down to awareness. Right. A lot of this does come down to educating and advocating. Right. And again, that's where I come in as someone in the K through Twelve Realm. And so, Sergio, Sergio, I'd love to give you an opportunity to build on some of what was stated here, as I know this is something that you're passionate about and that we've been talking about. Just bring us further into your lens as a banker and how this resonates with you.
Sergio Muñoz [00:32:58]:
So I've been entrenched over the last 13 years in government funded programs that go out to homeowners. And so the funds are originating at the US. Treasury. And so I have been at the street level watching how these programs work. And so in my mind, when I first met Sandy Darity, I thought, wow, these programs were created over a weekend with the Tarp program. Like, over a weekend, two days to get these programs into place with $9 billion. Right? And so I see similarities with, like, for example, the Dream Acts. You can't do anything to get that to pass baby bonds. I'm seeing that it's building momentum, but I'm seeing that it hasn't passed yet. Right? And so what what does the public need to do? Or how does the public need to get educated on building that groundswell of support. So that I imagine and Sandy, I'll ask you, how did Corey Booker get involved and why is he not powerful enough to put this through over a weekend?
Dr. William "Sandy" Darity [00:34:44]:
That's a great question.
Sergio Muñoz [00:34:47]:
No disrespect. Right.
Dr. William "Sandy" Darity [00:34:53]:
When we first heard from him, it was at his staff's initiative. He had a staff member who he had told, go out and find me some big ideas for my campaign. And this was prior to 2019, obviously. And so there were two big ideas, and there's one that we really haven't talked about at all today, but the first big idea was baby bonds, and the second one was a federal job guarantee. And what's interesting about that is actually upwards of 75% to 80% of Americans are in favor of it, but it has no traction whatsoever in Congress, which raises some further questions about the nature of American democracy. But that's something that we're tangling with at the deepest level right now. But when work was being done on the baby bonds idea, it was also folded into a wider package of policies that come under the rubric of an economic Bill of Rights for the 21st century. And so I have no idea why there hasn't been more support for the federal job guarantee. I can understand that we don't have an acknowledgment of significant public support for Baby Mons, although even right wingers who talk about leveling the playing field ought to be heavily in support of something like this because it doesn't undermine the market system. In fact, it just makes the capacity for people to participate in the market system more equitable. So that's a great mean. I don't have a good answer. Political the political failings here.
Sergio Muñoz [00:36:57]:
Let's push it to Alejandra.
Alejandra Montoya-Boyer [00:36:59]:
Yeah. Can I jump in? I said I was going to bring an optimistic approach, and so that's what I'm going to try to offer. Although the sentiments of our potentially failing American democracy maybe that's another podcast, and I'm happy to talk about that anytime.
Roberto Germán [00:37:14]:
You're welcome to come back.
Alejandra Montoya-Boyer [00:37:16]:
But I will say it didn't happen in a weekend and it's not happening next weekend. I can tell you that. But momentum has shifted. This is a policy. Baby bonds is a policy that went from kind of obscurity with a handful of brilliant economists coming up with a proposal that the American public did not really know about and even still is under known for sure. And there's a mobilizing and public awareness campaign work that we are working on with a number of partners that is critical for its success. But I will say that the fact that we're seeing state legislatures pick this up, the fact that there's actual conversations when Senator Booker first introduced the American Opportunity Accounts Act, I think he and a handful of senators, there was like two or three senators that were co sponsors. There was not a House counterpart since then, since he ran for. President, and it become a much more widely known policy. Chuck Schumer has now co sponsored the co sponsorships in the Senate are almost all of the Democrats, to be quite honest. The House counterpart now has a number of I mean, we've seen Connecticut and Washington, DC. Pass legislation. California has something similar that's specifically targeting kids who lost parents to COVID. We've seen legislation in Washington, Massachusetts, Nevada. Louisiana has done a study of it. Iowa has brought this up. There's talks in New Mexico. I absolutely recognize that there is more that the federal government could and should be doing. But in the span of about ten years, we've taken a policy that is almost specifically race targeted, which in this political climate is a nightmare, to be quite blunt, to become something that has growing momentum that people are really interested in learning about and supporting. And when we go to the Hill, we're now talking about it, and state legislatures. We're now talking about it as something that is maybe not viable this year, but is becoming viable in a near future in a way that I think is very surprising and a deep shift in its place in the policy space.
Dr. William "Sandy" Darity [00:39:58]:
Yeah, I was just going to say that one of the things that's important to keep in mind is that most of the state level policies have some sort of means test attached to them, whereas I think the conversation about the federal policy is it's indeed universal. Now, when Derek and I first introduced this idea, we said, well, the amount should be calibrated on the basis of the net worth position of the child's family. In the Corey Booker proposal, the amounts are calibrated. Well, it's a little trickier. There's a lump sum that's given to every child, and then on an annual basis, additions are made to that lump sum by the government that's based upon the income of the family, not the net worth. And I think that this is a clever idea because it prevents families from gaming the system. But on the other hand, we would rather that it would be the family's annual wealth position rather than its income position that's being used for the calibration. But I think that the Booker staff thought that that was data that was too hard to get, whereas you could rely directly on people's income tax information. That gets a little tricky for the people who don't have to pay any income taxes, who were probably the folks we're most concerned about, but income was easier to get a handle on than wealth with the existing data that we have on individuals in the United States.
Roberto Germán [00:41:47]:
So much nuance here, just thinking about everything that y'all are sharing.
Sergio Muñoz [00:41:53]:
So, Roberto, I would like to bring this to the more personal level. If you didn't is with you. You have three children, correct? Yes. Okay. I'm looking at this from the perspective of a six year old, and I'm in the fortunate position that I'm privileged. And so I actually did this for my six year old. Like, my six year old has a six figure drip fund that is compounding. He does not know that he has a six figure drip fund that is compounding. Right. And there is no language available to me as his father to explain it to him. Right. At six, how do you feel? What are the ages of your children?
Roberto Germán [00:42:45]:
Eight, five, and two.
Sergio Muñoz [00:42:48]:
Okay, so the eight year old, do you feel that you can explain economics in any way to the eight year old?
Roberto Germán [00:42:57]:
I don't think I can explain the drip fund, but we talk about the importance of investing, the importance of saving, the importance of compound interest. I think there's probably more work that I could do to make it kid friendly, and I'm still trying to understand that. Right. Because if I'm being completely honest, it's also taken me a while to understand not just a lot of the language, but how this works.
Sergio Muñoz [00:43:34]:
Let's go to Abigail and talk about messaging in terms of compound interest in elementary school.
Abigail Golden-Vazquez [00:43:43]:
Why are you doing this? To like, what kind of question is that? No, it's cool because I'm actually obsessed with this issue, not necessarily compound interest, but I'm very obsessed with the creation of wealth and how people who don't have it can get it. And I am going to tell you why. Because I literally had one wealthy grandparent and one factory working grandparent who, when they retired, had to work as a janitor to continue to survive and provide for his immediate family. So I have seen firsthand in my own household, the absolute different trajectories available to people, depending on where the starting point is. So I care deeply about this issue. Interestingly, I have a 13 year old who was lucky enough in public school to start an invest to take an investing club, to participate in an investing club, probably when he was about nine or ten. And I didn't know that it might have sunk in. But check this out randomly. This weekend, we were coming back from baseball camp and he started telling me about how the teacher told them not to invest in Tesla because their class last year had lost all this money in Tesla and this one kid did it and killed it. You don't know what they're able to learn or not learn. I'm not sure about whether it's important to have some complex baby bonds discussion or some complex compounding interest discussion with a child. There's age appropriate things that educators would know a lot more than me about. However, I started an allowance when my child was about five years old and there was $3 a week. One dollars went to charity, one dollars went to personal use savings no, excuse me, personal spending, including buying gifts for birthday, gifts for friends, and one dollars went to savings. And we have slowly increased that over time with age, according to literally what the Internet tells you, you can do, like, what's appropriate for the age. And my kid is I wouldn't say super savvy, but he started a little business. He was side hustling. He would buy stuff at Costco and then resell it at school. And we sat down and really tried to work through like, how do you know if you're making a like, how do you know how much you need to buy and how much you're trying to make and all the stuff he got in trouble for it and he had to stop. But I think these things are what we as parents can and should be doing, is to start introducing them to these things. And I certainly wish there was a lot more education on finance in school. I think that's something we could bring back. And it used to be in home economics and stuff like that, and then that just got thrown out the window at some point. But in whatever fashion that it comes, I think it's incredibly important to continue to educate. Eventually you can get to compound interest, but let's just start maybe with our home savings account.
Alejandra Montoya-Boyer [00:47:10]:
Yeah, well, one I'll throw one little quick thing. Prosperity now has been using a Monopoly metaphor. We have some TikToks out there that I'm happy to send because, yes, we're on TikTok and we're trying to get it out to the masses. The Monopoly metaphor works to some degree with kids, but also with adults.
Sergio Muñoz [00:47:29]:
Does monopoly still exist?
Abigail Vazquez-Golden [00:47:31]:
Yeah, except there's like a million new versions and there's one forever. I'm sure there's going to be like a Barbie movie version and a Monopoly.
Roberto Germán [00:47:38]:
Monopoly has a monopoly on the board game, Sergio.
Sergio Muñoz [00:47:41]:
I can't see my six year old actually busting out a Monopoly thing with a switch next to him or a tablet next to sure, I can't see it happening right now, but I'd love to see it happen.
Abigail Vazquez-Golden [00:47:56]:
Yeah, I'm sure there's versions. And while I'm not a parent, I do have two Sobrinos that are eight and ten and they keep me very aware of what's on the forefront of toys and board games. I swear my niece is going to be a politician, a president, like maybe the first Latina president, who knows? But I think they fully do understand. They can describe what I do better than I describe it sometimes because I think they're fully aware of we've worked really hard to describe the challenges of the world and just be really blunt and upfront with them about racism and sexism and wealth inequality. And that part of the way that we're able to fix this and fix it is through we have a government that is meant to be responsible for responding to these challenges and crises. And right now how effective that is, again, probably for another conversation, but that it's meant to be driven by the people and they as kids are a part of that group. And so making their voice heard by they've written letters to the president. They've written letters to their members of Congress. My niece has published an op ed on providing resources for low income families in the Albuquerque Journal. I'm from New Mexico, so I also think they have a particularly involved know I'm not the only person involved in politics and policy. So they're in an environment and ecosystem where that's being absorbed and they have that privilege. But I can also say they go to their school and perform these same things. They're running their little friend groups because they've built up this idea of consensus and they implement their democratic practices. They run little elections on what games they're going to play and who's going to be like captain of the soccer team. One, I think we underestimate what kids can absorb and take in and learn, especially when these are like politics is born out of lived experiences and particularly for people of color, that stuff gets absorbed young and kids are so aware of what's going on in ways that is so impressive. And so if we can just foster that even just a little bit, and flame those fires or whatever the metaphor is, I really think that it's something that future advocates and we're seeing that. I think newer generations, Gen Z and whoever like TikTok and Twitter, although maybe not Twitter so much anymore, is so full of examples of advocacy and people fighting for and calling out bad policy, good policy. Being translators for their community and other communities both in, like how do I describe this in a way people will understand, but also, how do I turn this into Spanish language? All the things I think it's happening naturally because we're also as a response to trauma and crises, which is pretty terrible, but also hopefully they're going to make it all better and fix it for us.
Roberto Germán [00:51:19]:
Absolutely. Part of what we're trying to do here is, yes, there's been some reactive stuff, but we're trying to push this so that there are proactive approaches to the dialogue, that we're implementing proactive strategies, and that we're also encouraging. The schools to teach about these topics, to teach financial literacy, to help support economic freedom, right through advocacy, but also through understanding the policies that are out there that could help change the trajectories of families. And so as we wrap up here, because we only have a few minutes left, I'd like to just go around the room real quick and ask each of you, starting with Sergio, to share as it relates to this topic of wealth inequality, what's a message of encouragement that you have for the people. And Alejandro, you're going to love this because I know you're working on not being a pessimist.
Sergio Muñoz [00:52:16]:
I'm in the same loop of defeatism that Alejandra's in. So I sympathize and empathize, and my opinions of the United States are probably a lot lower than maybe other people's. So Corey Booker was just with the Aspen Institute and talking about baby bonds and he we really got to turn ideas into was for me. That was the thesis of what he said. Right. And so the idea has already been thought by Sandy Darity and Derek Hamilton. It's already gone through multiple iterations and if we start to get positive about it, it's starting to gain some momentum in certain ways. Not enough for me, but still nonetheless, the action that would inspire me now would be to build that groundswell of support among educators, especially in K through twelve, to begin to talk about money, which is taboo still in this country, and trust in the money management industry, which is super complex. And then lastly, compounding. Compounding is such a bizarre concept in capitalism that I don't know why anybody would understand it. Right. But it has worked really well for a certain type of person over the course of history.
Roberto Germán [00:54:07]:
Well, we're going to push to make it work well for every type of person. Dr. Darity, your message of encouragement.
Dr. William "Sandy" Darity [00:54:14]:
Well, I do think there's some signs of encouragement Alejandro mentioned which have to do with the initiatives that are underway in a variety of states for this type of program. And I hope that at some point there will be sufficient momentum to make it happen at the federal level and that that will encompass all of the state initiatives that are underway. But I think there's something positive in the fact that this has gotten serious consideration and even approval in at least one state.
Roberto Germán [00:54:55]:
Thanks for sharing, Abigail.
Abigail Vazquez-Golden [00:54:59]:
Sure.
So mine is a bit of pessimism with a slight bit of optimism at the end. One of the things I didn't get a chance to talk about before is so often Latinos are left out of the messaging piece of all of these great policies and I can give plenty of examples, but we're at the end here, so I'm not going to do that. But what I want to say is we know now what can be done. I think we have some hooks around messaging that can work and it's really just about investing. So what would make me very optimistic was if we started to invest in getting that awareness out to the Latino communities. I always say plural because there is not one Latino community. So I think we know what we have to do and I think we know how to do it. We just need the dollars to make it happen. So that coming to the table would make me super optimistic.
Roberto Germán [00:56:01]:
Gracias, Alejandra.
Alejandra Montoya-Boyer [00:56:03]:
Yeah, I'm still learning to be an optimist, so it's going to be a little pessimistic. Yum. We have to, I mean, the reality is that if we're not doing something about wealth inequality, about the barriers caused by structural racism, this country and our global society will not be able to function. And flourish with a growing number of people of color. With capitalism on the brink of whatever it's doing, our democracy, we really have to do it. These are necessary challenges to solve, and they will just continue to exacerbate to the point where apocalyptic visions are entering my brain right now. So my message is really like, and there are so many ways my point is not everybody needs to be a policy advocate or a politician or all these things. Educators, artists, activists, creators, authors. There are so many ways to tackle these massive challenges that are all intersecting. And so this isn't just like, everybody go work in Washington, DC. This is like, we need to make a more just economy, a more just society, and we're hopefully going to find a way to do that.
Abigail Vazquez-Golden [00:57:34]:
If I could just add one more little optimistic note, too, to end on is I'm old enough now to have seen some huge changes in the last couple of years. Just even awareness of wealth inequality, of tracking of inequities, and a new lexicon in a language to talk about it that is widely understood and accepted. Not by everyone, of course, but I think we are in a very different place than we were 1520 years ago of just understanding the causes of structural racism and systems of oppression and inequality on a mass level that certainly wasn't around when I was coming up.
Dr. William "Sandy" Darity [00:58:22]:
One more addendum yes. Which is people always ask, how are you going to pay for it? Well, this is not a particularly expensive program. If 4 million newborn infants received an average of $25,000 as their initial trust fund amount, it would cost $100 billion. And that's out of a national budget of $6.27 trillion in this country.
Roberto Germán [00:58:48]:
We invest more money than that on things that are meaningless or less impactful, I should say. Well, thank you all. Thank you all. I'm hopeful because you're doing a lot of great work that is having a big impact. And I know we have some pessimists here, and I include myself at times. I'll also add that when I think about some of the people in my circle, it's been fascinating to see witness the growth in terms of a generation of people who are really paying attention to the steps that they need to take in order to set their children up. Even if the school is not feeding them that information now, we're still going to push the schools. And that's part of my duty. And we're still going to challenge curriculums to include teaching on financial literacy, to include opportunities such as the one that Abigail's son had, to have a class in which they're actually doing hands on learning as it relates to investing, just like my nephew had at the private school that he attended. And so we want kids to have those opportunities across the board, right? Not just certain public schools and not just the private school. We want kids to have those opportunities regardless. And so thank you all for your insight. Certainly there's a lot more that could have been discussed and a lot more that you can all contribute because you're experts in your area. So I'd love to reconnect at some point down the line to dig deeper into some of the things that we weren't able to unpack more fully. I invite you now open invitation to revisit our classroom, to continue to share your knowledge and hopefully to impact my audience and to impact the many educators that I know who I think are receptive to this. But perhaps don't necessarily have the understanding, the insight or the strategies to teach some of these principles, which for you it might seem like a basic thing, but I think there are many individuals who are also struggling to understand how they could become financially free themselves. And so we want to support them in doing that. And as we're supporting them, then they will be supporting our young people. Thanks for your time, and we will do this again. .
