PATERSON, NJ — Joined by legislators, faith leaders, and others, Gov. Phil Murphy held a press event in Paterson to promote his “Baby Bonds” initiative that would provide a $1,000 deposit into an account for every baby born into a New Jersey household with income less than 500% of the Federal Poverty Level ($131,000 for a family of four) in 2021. The plan, which U.S. Senator Cory Booker is promoting on the federal level, is part of Murphy's revised Fiscal Year 2021 Budget.
“While COVID-19 has had an enormous financial impact on many New Jersey families, it has laid bare systemic inequities that have disproportionately denied families of color an equal chance to achieve upward mobility,” Murphy said. “To emerge from this crisis as a stronger, fairer, and more resilient state, we need to lay the foundation for the next generation of New Jerseyans to secure their spot in the middle class and break the cycle of economic inequality.”
“We are seeing wealth inequality at its highest point in decades, which is severely limiting equal opportunity for many Americans,” said Booker. “Every child should have an opportunity to build assets, create wealth, and achieve upward mobility. As I continue working to address the racial wealth gap on the federal level, I applaud Gov. Murphy for prioritizing economic inequality and introducing this bold proposal.”
The proposal requires newborns to either be born in the state or be born to parents who are New Jersey residents in order to be eligible for an account. Baby Bond recipients would have to be New Jersey residents to withdraw funds from their accounts, although they would not be required to spend these funds in the state.
Republicans — including NJ State Senate Minority Leader Jon Bramnick, who met with Monmouth County Republicans on Wednesday to mobilize against what he calls the “tax and spend programs of Governor Murphy” — are not sold on the idea.
“Gov. Murphy’s budget includes a plan to gift $1,000 to every child born in New Jersey for one year. The governor must borrow 80 million dollars to fund the 'free money giveaway plan',” Bramnick tweeted.
Under the Governor’s initiative, the state would establish the Baby Bonds Initiative Fund, which would include individual accounts for eligible residents. Funds in each child’s account would be invested so that they generate returns that are at least equivalent to 30-year US Treasury bonds. Recipients would be able to withdraw funds when they turn 18 for allowable uses that build wealth such as homeownership, higher and continuing education or entrepreneurship.
Gov. Murphy reported on Wednesday that New Jersey has 356 new positive cases, pushing the state's cumulative total to 194,990. He also announced seven new confirmed COVID-19 deaths for a total of 14,220 lives lost. Of the seven newly confirmed deaths, four occurred within the past five days.