State Senator Josh Becker Urges Using the Historic Surplus to End Generational Poverty

For Immediate Release

MENLO PARK – State Senator Josh Becker called today to use the state’s historic surplus to attack economic inequality and for the Legislature to embrace a moonshot investment to break the cycle of generational poverty.

With indications this week of a historic $75 billion surplus—three times what was projected just four months ago and a $125 billion reversal from one year ago—Senator Becker said California must use the surplus to tackle the problem of economic inequality by taking bold, innovative steps to end generational poverty. One way to do this is by starting a Baby Bond program along the lines of what has been proposed at the federal level.

“We should invest heavily in our youngest. The Governor’s proposal for savings accounts for school kids is a great start,” said Senator Becker, D-Peninsula. “We have a historic $75 billion surplus. Now is the time to be bold: Let’s start with babies. A Baby Bond program would put money into a publicly funded trust account for every child at birth -- with more for lower income families. An analysis by Naomi Zewde at CUNY shows this proposal can dramatically reduce wealth disparities.”

‘Historic Need and Historic Opportunity’

“This is a time of historic need and opportunity,” Senator Becker said. “I'm heartened that the Governor is strongly embracing early childhood education. From my years on the San Mateo County Childcare Partnership Council, I know what a smart investment this is for our kids, our families, and our community.

“Baby Bonds are the next step. A savings account for every newborn, especially those in low-income families, will give kids a chance to get ahead.”

Momentum for asset-building policy is not new. Senator Becker pointed to Full Circle, a nonprofit that he founded, that has supported asset-building policies over the years -- policies aimed at encouraging saving, matched savings accounts, getting low-income workers into the banking system and other policies that can break generational poverty by allowing savings to ultimately be used for higher education, buying a home or starting a small business.

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Further resources:

Universal Baby Bonds Reduce Black-White Wealth Inequality, Progressively Raise Net Worth of All Young Adults
https://journals.sagepub.com/doi/10.1177/0034644619885321

Effects of Child Development Accounts on Early Social-Emotional Development
https://jamanetwork.com/journals/jamapediatrics/fullarticle/1815478

Media Contact: Leslie Guevarra, 415-298-3404, leslie.guevarra@sen.ca.gov