What'd You Miss This Week - New Jersey's Plan to Give Every Baby $1,000

This week, Darrick Hamilton, the Henry Cohen Professor of Economics and Urban Policy at The New School, and Naomi Zewde, an assistant professor in the Graduate School of Public Health and Health Policy at City University of New York, joined to talk about New Jersey Governor Phil Murphy’s baby bonds plan and how it could start to close the racial wealth gap.  Viral Acharya, former Deputy Governor of the Reserve Bank of India and NYU economics professor, came on to offer a global economic outlook

  • Play Speed:
Content Keywords: board member company
00:00:00
How can we harness and Collective energy?

00:00:04
What if I technology services today and tomorrow? Let's Champion the energy transformation discover how it Siemens energy.com.

00:00:24
I'm tired. I hide this podcast has some of our favorite interviews from the daily Market close to that. I talked about going on with Romaine Bostick & J wiesenthal what you miss is the perfect way to kick off your weekend this week. We took a look at the unequal economic recovery that is emerging from the coronavirus down time and steps that some politicians and policymakers a trying to take the clothes that that one of the new and Innovative policy prescriptions being offered is baby bonding. The electrons of time was introduced to most people buy New Jersey. Senator, Cory Booker during his run for president prime rate. Now, his home state is trying to put the idea into action, New Jersey governor Phil Murphy proposed to Statewide baby bottles initiative as part of his 2021 fiscal year budget the state to provide $1,000 deposit to eat newborn as long as the family income with less than 131000 a year.

00:01:20
500% of the federal poverty level according to the state budget presentation when these residents 1018 they kind of withdrawal These funds to help induce You Higher Education by a start a business with you all the wealth generating activities. We do Vin to the idea with two key experts in the field first. We spoke with John at Hamilton the Henrico and professor of economics and policy at the new school and internationally recognized Pioneer in the field of stratification economics. We started by asking him about how he sees Baby Bones as an interim step II reparations.

00:01:59
Reparations in baby bonds a complimentary reparations is a direct parsimonious approach to address the racial wealth Gap and it's a retrospective approach that recognizes the Injustice of the past and calls upon the US to atone for that with some redress. Where is baby Bonds in perpetuity ensured that everybody has access to Capital gender and race so you can see how both policies would complement one another sickly sketch through in the state of New Jersey. How do you see it actually playing out in terms of being a realistic plan that's enforceable.

00:02:46
And you know what? We say baby bonds for alliteration. If we were literal, they would be accounts baby account for trust accounts as opposed to a bond but I love the alliteration answer your question the ways in which both Cory Booker and Ayanna Pressley Define their bills in the Senate and House respective County could be augmented on a yearly basis based on the family economic circumstances that particular year. So I think the way to conceive of the New Jersey program is a downpayment States and localities. They are constrained physically in ways that the federal government is not because the federal government to stop in monetary power, but I love the way the governor of New Jersey explain this as a down payment and that he reserves the right to come back to these accounts on an annual basis.

00:03:42
And a down payment of schools is to be able to be able to do things. We see as grows in equality within the US economy that is very tough to try and focus on whether it's from a physical persuasion R&B from the monetary policy dramatically, if the accounts of properly resource the source of inequality in general in America is some young adults have access to an account that possibly appreciate over their life and accept it will pass if we appreciate like being a homeowner as opposed to a renter being a entrepreneur with some Capital to start a business as opposed to a worker or being in a managerial professional occupation without the albatross of student debt. So this is saying that as a Birthright less than sure. Everybody has some C.

00:04:42
They can benefit from an asset that will possibly appreciate over their life has unlimited capacity by state cases.

00:05:03
Yeah, I mean station wait like a dinner the New Jersey governor is saying we are not going to wait we are going to be proactive but this in solution to solving it has to come from the government. We can see places like California Environmental Protection before the Federal Government Federal Government, New Jersey taking this bold initial first physician children born in New Jersey with an opportunity to generate assets and then hopefully other states will emulate it and then the final so interesting you bring up California's leadership because my Toronto is in California, but also because it's feeling that does inequality in terms of representation in Corporate America.

00:06:03
political appetite the account

00:06:15
I mean if we work about where we are with reparations today compared to where we are little word for hatched four years ago. It's been dramatic progress. It is topical in conversation in the Democratic primary. All the candidates were held accountable based on position at least 1 HR 40. So one we've come a long way into its adjust policy so that to me is enough reason to commit to it.

00:06:44
How are you thinking about who would manage his account without Social Security work? We stop there is money left to pay out in about this is a great idea. How do you manage it and make sure that it is used for the benefits at which it was supposed to be in that is managed appropriate.

00:07:07
Yeah.

00:07:09
Many of our policies always politically vulnerable. What are the good things about social security that makes it less politically vulnerable is the impact it has had and the fact that people are already receiving the accounts the once if we get to a point where baby bonds are starting to extend go out and they're properly resource, it will be harder to go back but just like Social Security baby bonds would be managed by the state. So somewhat ironically intended to protect children from the decisions of their parents as well as the economic circumstances of their family. We haven't talked a lot about gender, but we know within households did patriarchy and probably decisions about which child male or female estate will Reserve this for you when you become an adult as a child. End in one last point

00:08:09
If you think about social security one of America's most popular programs and perhaps successful public policy programs.

00:08:18
We have stuff for people when they age into the Twilight of their life for nothing for young adults Beyond subsistence program when they are coming of age and beginning a lifetime of building. You can Amish the that's what baby bonds is intended to do. It's not an income policy would rather intended to address wealth so that we can begin a bridge to Social Security building a lifetime of Economic Security from birth cradle all the way to Gray.

00:08:48
And we continued conversation with Naomi Zodi and assistant professor at The Graduate School of Public Health and health policy at City University of New York near me is also a research fellow with the Roosevelt Institute and older the paper back in 2018 fighting a universal baby bonds as a way to reduce black white wealth inequality. We started by Austin help what amount of money the baby program would need to provide to really move the needle on the racial wealth Gap

00:09:16
the New Jersey Bill like you said, it's small but it's something and that is huge. I think that ideally, you know, when were talking about the magnitude of wealth inequality. There is one problem with his that smooth along the racial lines. We're at the median household in 70,000 verses about 17,000 along racial lines thinking about that kind of magnitude.

00:10:11
Interesting. So an order of magnitude larger than what he was talking about durations in particular to fix what has been in slavery north of inequality in general in America is some young adults have access to an account that will appreciate over their life and appreciate like being a homeowner as opposed to a Rancher being a entrepreneur with some Capital to start a business as opposed to a worker or being in a managerial professional occupation without the albatross of student debt. So this is saying that as a Birthright lesson sure everybody has something so that they can benefit from an asset. It will pass if we appreciate over their life.

00:11:20
That's right. So is the cost of higher education continues to increase at the pace that it has for the past 20 or 30 years many universities around the country. So no one trip to the hospital. It could we don't have control over the cost of basic living expenses education Healthcare and kind of strength in all of these parts of our society. Is it the baby when they turn 18, is it the parents during

00:12:20
structure that contract essentially between the state giving the money and the recipient

00:12:26
So I think this is difficult because so many parents might need that money today for their children program is supposed to be is that that you can use to reach forward like what comes in every month and you needed to meet your ongoing need any kind of changed like purchasing a home starting a business can just moving to another city. These are like kind of the extraordinary expenses that you have in the background for for that purpose in their basic kinds of restrictions on how they can use that money or should they be allowed to consume it?

00:13:24
Maybe people have enough kind of into the future and in coming to this money know that it's there when they're growing up there for their future and have some plans for how they can best maximize the returns did even visit this coming from a federal level a choosing but it needs the states to own it to. End of the federal government before we can make sure that this is something that crosses across the United States.

00:14:13
I think that we should try to get good good legislation passed weather is at the state or at the federal level and it's a good thing that the state of New Jersey and the governor in particular is taking some leadership on this quality in general most likely that's going to come from there's a lot of medicare-for-all in Paris.

00:15:13
Is anything potentially a harbinger of things to come?

00:15:18
The one constant in life is change. Should we all change for the backup? How come we call me some collective energy. How can I turn off Global challenges into opportunities? Can we transform not just our energy, but I was

00:15:36
That's galvanized change, you know homes offices in Industry. That's Champion the energy transformation discover how the Siemens energy. Come.

00:15:51
Roommate is not the only ones trying to a meteorite the economic pain being felled. I'm at the covid-19 global Central Bank has its going to Child Support Recovery using them under people. Listen to book. We spoke by the response. I had to the job site with Barrel at Aria is the former deputy governor of The Reserve Bank of India. We started by asking him when he would give monetary policy makers.

00:16:18
Is 7.528 a dividend an excellent job of accommodating the short-run concerns, they've gone to the emberlight very decisively extending the support event markets, which is something that typically Federal Reserve doesn't do that easily the nerves right at the time of the question is there seems to be a significant disconnect and possibly even zombies from The Walking Dead companies in the economy. And the fact that they're actually able to continue to leverage of their balance sheets at extremely low V.

00:17:18
Play sleep because of this concern of credit risk and how that might play out in the economy down the lines that I fall short of giving it to 9 or the responsible gotten out of policymakers here. There's also this sense here that there's been a lot more Nations this time around in this recession recession all fiscal policy and monetary policy. There has been sort of a melting of this. We seen some countries take it to the extreme like in Indonesia, and we seem countries here in the US sort of nibble around the edges with it. Are there Distortion risks that we need to be worried about as investors as. Just type of coordination.

00:17:59
Please turn off the Apple Bank that's physically dominated meaning that it starts focusing exclusively on helping the government instability inflation objektiv that has been very common in Emerging Markets along the lines you mentioned it's something that I talked about quite a bit in my recent book request for restoring Financial stability in India, but I think we are likely to see it in the shores of a developed economy's very soon.

00:18:59
The last 6-7 years used to play a physical role. Why is this important? This is important because right in some ways that are some supply-side cost pressures building up, especially in emerging markets and discretionary spending investigating get credit from the bank's money to go to work Elementary.

00:19:59
Definition of repression risks from policy is reflected in these negative Real Racing 3 is what you see when you see negative will Raves across across Europe real nominal negative race as well as search for the fixed-income instruments are also giving very repressed user to login because of large quantitative-easing programs direct interventions in the whole package of this front or search will actually carry over to the equity markets as well. So while it is still too early

00:20:59
vigorous

00:21:14
So I want to ask you specifically for a second here about India your course you were the former Deputy Governor. They're over at The Reserve Bank. And you know, you came to a lot of people detention Elise outside of India when you gave that speech a couple of years ago about Central Bank Independence, the more importantly about some of the stresses in the banking sector and when you look at the state of India's banking sector right now, you look at some of the stresses in the corporate sector there and you look at the contraction that we seen in the economy. What steps do you think that the government there can take at this stage to take itself out of that hole?

00:21:51
That's a great question in the first chapter of my book is India's financial statement be separated from the stability of the fiscal situation would face. What about 3 years. You spend your way out of the current problem.

00:22:51
Actually hold the mirror the government progress on fiscal consolidation going for government borrowing requirement between us entered the States government owned Enterprises of various types Because unless you know, exactly the situation is right now. Should be a calibrated mediums of thought because of the likely Mountain non-performing assets. I say when you invest in real estate location location, then you want to stabilize your financial sector its capital capital.

00:23:51
I think he needs to ask his thanks to a stop at 1 or 4:40. I think this would be a perfect time to go to the bank balance sheets with public sector banks by the government to put the steaks below 50% in many cases has some of the NBA.

00:24:22
Toto Trattoria, it's a question. That is also not shut juice is way awesome. Yes, I was time and time again at the moment as to the two poem nature of the recovery. We're likely to see faces equal night shift, so we will see how worried are you how to study this to ensure that the recovery from this financial crisis what crisis doesn't drive in a call to see if you still back in 2008?

00:25:01
Set of questions everyone's focus is on getting together and it is a very fundamental shock accelerated some strange that were already under way in terms of how the economy is using its productive capacity at the same time. It's talked to some of the services sector a minimum of three to four years such as in case of Airlines to come back to their feet covered by you the time should not be to work on release measures. This is a great time to actually undertake the missing structural reforms.

00:26:01
Elliptical or shoot some of it be used to actually build infrastructure and create jobs for the economy need to be undertaken in the number of these countries. This would be out of the private sector can also actually start growing where they would be easily and you and you have to go to his inventions that are required by my fear is that we would have been so much and so little quote sustain momentum. You know, it may be harder to actually create jobs Medical

00:27:00
This week. We also took a look at some of the companies looking to turn this down turn into an opportunity crafting like that. Let sports fans legally gamble trading is a public company back in April of reverse merger with diamond Eagle acquisition Corporation since then she has more than doubled even the Hiatus. Full now the company is going in a major Boost from one of the world's most famous athlete whose own love of gambling what time NBA champion Michael Jordan in exchange for his role as a special adviser. It online sports betting companies directed the movie has even higher we spoke about the deal with Mark kadish dropped off our president in America by asking him what the company hopes to get out of the NBA legends advisory role.

00:27:58
We're really excited to get to have Michael Jordan join as a strategic advisor to the board and I'm a board member. I oversee our marketing and brand building operations. I think he's one of the Geniuses in terms of brand building is a marketing genius an iconic image and brand around himself and then brought that to Millions. It's an entire cultural movement really and I think that just to Yuma collaborate work with Michael on our different business initiatives are marketing our brand and it just the day-to-day interaction will really help Elevate what we're doing on all aspects of the way we go to market and connect with our customer.

00:28:39
Yeah, I did a billion to realization say it's excited by what he can provide us about the focus of marketing and how competitive it is out there at the entrance into the market. Is that going to be a warrior king concern or is it with the likes of Michael Jordan that you can get a bit of Football Focus?

00:29:11
Performance marketing company we invest where we believe we can get it at gravy turn on the marketing Investments that we're making the sports betting expansion in the United States is traumatically increase our customer LTV. He's in those markets and then in some markets where there's Casino offerings and other things all of that just adds up to a really really valuable customer that were chasing after and there's millions and millions of them throughout the entire country. So we believe our culture of view analytics Performance Marketing and and using that framer to go to market and invest aggressively been up to our limits in customer acquisition is the right formula to win long term. We have eight years of experience doing that in fantasy. And now we're just applying that into sports betting and until he's also trying to capture the customer's attention while you have them of course many people are working from home is so there are feeling like you're setting is something the same time.

00:30:11
Are you worried about a shift if we do end up going back to work how you continue to capture that attention?

00:30:20
Yeah. Yeah, I mean it's a day in day out effort to make sure that we understand the context around what's going on in sports and that were staying relevant and connecting with the customer and last year at this time. There was a NBA playoffs there wasn't Major League Baseball and our team is very Scrappy and hungry to go out in the end attract and retain your every last skin in the game sports fan out there in the United States. Yeah, that's what we do. We're content company first in everything. We put out there to drive engagement and retention of that audience said so coveted right now location of ounces to deal with all across the street from Wrigley Field and if it's a kid who grew up while running around the grandstands at Comiskey Park, I won't fault you for going to the north side rather than the South side, but I can understand for business that has been so successful with the guards WhatsApp and it's online president. What does having a physical location bring two?

00:31:18
DraftKings has announced in cor official partnership with a tons Cubs which makes us the official sports betting partner in this multi-year agreement. I think that Crown Jewel of that agreement is the right to build a retail Sports Pack, which is really going to be a flagship destination Sports Park in the heart of Wrigleyville. We're in the process now of collaborating with the I'd be the Illinois gaming board as well as the city and state officials to make sure that we can get our plan approved and Brake Grand and I believe that DraftKings here as a part of that Community. We can really add a lot a lot to the experience of going to a Cubs game and stop by the books make a couple of bats go in cash them on your way out your it could really had a lot to the experience that I think millions of saying I'm looking for but we want to do it the right way. We want to build great relationships in the city and collaborate with the gaming board and make sure that that's a fantastic relationship all the way through.

00:32:18
The ways and means of which civilization is on vacation. I'm interested in the 110 States you written about

00:32:48
the news is coming in Fast & Furious. I would say around sports betting whether it's a Virginia, Michigan State's are all talking about whether or not they want to regulate and open up the market for sports betting operators DraftKings to enter and I think there's a ton of Merit to the idea of opening it up first, you know, there's already a very vibrant black market around sports betting and DraftKings. It is really just bringing it regulated safe to play market the same product at millions are already playing today. It's a benefits and turns and jobs in tax revenue in the state at a time, especially like now we're so many states are feeling the pinch from coronavirus and the end of thing of it. I make activity date and tax generation and its really brought opportunities like sports betting to the Forefront everyone's talking about it, but there's so many issues out there. So it's really a state-by-state roll out and we're just looking forward to seeing what comes next.

00:33:48
Agile company we can get up within a few days or weeks of announcements of what different states would like to do on the sports betting issue and we're eager as in those markets as they open up.

00:34:03
That's it for this episode of what you missed this week. If you like the Subscribe and whatever you listen to your poker and June and every weekday to our daily market closed from 3:30 to 5 p.m. On Bloomberg television on from 4 to 5 p.m. Streaming on Twitter. Thanks for listening and have a great weekend.

00:00:00
Translate the current page