State Treasurer Zach Conine is proposing a measure to establish a “baby bonds” savings account for every Medicaid-covered child born in Nevada.
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The program would invest $3,200 in a bond that the Treasurer’s office will manage until the child is 18 years old.
“Basically what it does is it provides a pathway to financial security for individuals who grew up in poverty,” said (D-NV) State Treasurer Zach Conine.
The proposed baby bonds program would give an individual whose birth is paid for by Medicaid—or who is under poverty—32 hundred dollars in an account that grows between the time they are born and the time they are eighteen.
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Conine says the average account will grow to $15,000.
“What baby bonds allow us to do is move families from poverty into the middle class. And, by moving them into the middle class, that means that all of a sudden the government is not paying for all the things that those individuals need, which means it saves the taxpayers money,” said Conine.
Conine says the program will help 15-16,000 babies a year and cost the state around $2.5 million annually.
“While we’re talking about investing this money into families, what we’re really doing is saving the state hundreds of millions of dollars in the long-term services that need to be provided to families who are never able to escape generational poverty,” said Conine.
One argument against the baby bond concept is uncertainty over what it can actually achieve.
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While the goal is to lessen intergenerational dependency on Medicaid, food stamps, and welfare; it’s unclear how much long-term wealth generation it will create due to the prohibitively expensive cost of higher education and the housing market pricing out the middle class—trends that show no sign of slowing soon.
But Treasurer Conine says the government is already providing services to Nevadans who cannot provide for themselves, which gives individuals a leg up.
“It gives them an opportunity to build their own future, as opposed to just being on the sort of government dole forever. It gives them a chance, and one thing the government should absolutely be in the business of is investing in ways that one – save the taxpayer money. Two – provide more opportunity for Nevadans,” said Conine.
Treasurer Conine says the treasury is performing the best it has in state history.
He says that when he started six years ago, the state was making about 12 million annually in investment returns. And now it’s making 400 million per year – more than one million dollars a day.