$5,000 for Every Child?
By Alan Stewart Carl | Related entries in Economy, IdeasWhat if we gave every American baby a savings account with $5,000 in it? We then allowed their parents to contribute more, tax free, until the child is college age. The child could withdraw the money between the ages of 18 and 25 to pay for college, start a new business or buy a home. The catch: they have to commit to one year of national service in order to access the government money. Harold Ford Jr. and Al From are proposing just that.
In general, I think our government is most effective when creating opportunity rather than just handing out money. However, this could be a giveaway that results in opportunity. A lot of Americans lack a safety net, particularly in their early adult years and this would provide one while also invigorating national service. Unless you’re reflexively against all government-based plans, this one is worth consideration.
I do have several concerns. Will the $5,000 be held in private banks or some kind of government run account? If it the money is put into private banks, who chooses those banks? Do we have systems in place to absorb a large increase in youth joining national service organizations and do we have the funds to pay those youths a decent wage during their service?
Will we need safeguards to protect these investments from a market collapse? Will there be tight restrictions on how the money can be spent or will the recipients have access to the money regardless of how they want to spend it? Finally, this plan would balance government coercion with personal responsibility – is it wise to make those types of bargains or is it social engineering that would create undesirable consequences?
I’m always fascinated by new/different ideas. I hope this one receives some real discussion.
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March 22nd, 2008 at 8:18 am
I am a firm believer in national service – I think 1 year is too short – 2 to 3 would be better – and it must be mandatory. Children of the Bush’s, Clinton’s, Vanderbilt’s, Rockefellers are required as well – no deferrals, no quibbling, “just do it”.
I don’t agree with the $5,000 at birth it just seems silly – sort of like a bribe to help them get elected again. I subscribe to the 75/25% rule in that after your service (military, peaceful, whatever) 75% of tuition and books cost is covered at most universities/trade schools and 25% by the individual either through 0% interest loans or work-study. If they want to go start a business “economic enterprise zones” offering mentoring and help combined with 3-5 year financing could be another alternative. I don’t like throwing money at problems…..I like throwing “people†talent at problems and then determining the best way to get to “root cause” – then throw money at it.
There is nothing wrong with taking an 18-year-old kid who doesn’t know “shit” and making him or her do something solely for the purpose of the greater societies benefit for a 2 to 3 year period. Afterwards they can go and live their lives as they normally would have – but with so much more life experience. It could really pull the country together as everybody of the same age bracket is completely level set for a period of their life – they are all the same….treated the same, paid the same, expected to perform the same. It would be a great lesson in humility that would come at the perfect time in their lives. It wouldn’t hurt them a bit.
March 22nd, 2008 at 9:13 am
I’m unclear on one thing. If it’s for you to use when you’re 18 and you have to sign up for military service… then why give it to them when they’re babies?
March 22nd, 2008 at 9:33 am
Dr. … it’d be an interest account. So $5,000 would be worth around $17,000 or so by the time the kid reaches adulthood (based on the calculations of Ford and From) and even more if his/her parents contribute regularly into the account.
March 22nd, 2008 at 11:45 am
Such a program sounds great in a sound bite, but is impossible in a practical sense. As part of my dissertation research, I’ve had to read much of the congressional and media debates over national service going all the way back to the 1950s. The problem is that there is never enough real work to occupy the 3-6 million people that would be entering the program each year. There is also no way to prevent rich people from being disproportionately able to evade it, either by purchasing exemptions (even medical exemptions can be bought) or just fleeing out of the jurisdiction to live it up in Europe for a couple of years.
Mandatory national service without exemptions is just not practical.
March 22nd, 2008 at 1:28 pm
Harold Ford and Al From have a lot of good ideas for strengthening our country and expanding opportunity. A few years ago, Ford proposed creating a savings account for every child born in the U.S. I really like the concept with a few conditions. To withdraw from the account at age 18, you have to graduate from high school with a certain minimum GPA and pass a drug test – which should also be requirement for the issuance of your first driver’s license. We need an expanded and updated GI bill for those young people who opt for military or national service. If you spend a couple of years serving your country, it would no longer be necessary to go into debt to obtain a college education. A similar program should exist for those students going into public service careers like education, law enforcement and other careers where we have a shortage of trained personnel like the health care and science fields.
March 22nd, 2008 at 6:17 pm
Jason
It’s public service – there is always allot of work to do in that area – no shortages of trouble and lot’s of help always needed. Social theorists love to talk about Immanuel Kant, post-modernism, structuralism, and even the overall lack of personal choice when discussing such subjects as national service. AmeriCorps, Citizen Corps, Senior Corps, Peace Corps, Army, Navy, Air Force, Marine Corp, Learn and Serve America even the Coast Guard or Border Patrol – these could all be expanded.
The issue isn’t one of practicality it’s one concerning our country and the increasing inability of the populous to negotiate those area of our society which hold our republic together.
The rich and well to do rarely if ever bear the burden of holding a society together. For their motivation is much more closely associated with taking from society far more than they traditionally give back. Rich people will always find their way out of situations like this if they are motivated to – but not always. In many cases those of the privileged class do serve, in fact they are proud to do so – and they serve with distinction. If they do not serve penalties can be determined but humiliation and loss of prestige work well too.
Despite my bloviating here, I very much appreciate the Libertarian point of view that “no one, no state, has the right to force service out of anyone for collective purposes”. Although asking our young people to serve for 2-3 years and offering incentives for that service is a step in the right direction.
Programs can be created that will work – the question is whether or not our nation has the sense of “nationhood†which would make this endeavor a success.
Do we have the will to foster a sense of shared success is the real question.
March 24th, 2008 at 7:48 am
Donklephant » Blog Archive » $5,000 for Every Child?…
From the article: “In general, I think our government is most effective when creating opportunity rather than just handing out money. However, this could be a giveaway that results in opportunity… Unless you’re reflexively against all government-b…