California Invests in the Future of Young People

As economic inequality grows unabated in the United States, policymakers are reaching for solutions to ensure the future of children born into low-income households. This is a quest that Brown School professor Michael Sherraden has been at for decades with notable success in the US and abroad. Most recently, researchers at the Center for Social Development at the Brown School welcomed the launch of CalKids, a state program designed to give newborns and eligible low-income public school students a jump start on asset development. It included 3.4 million children in the first cohort of enrollees and has more than $1.8 billion in assets, making it the largest child development account (CDA) program in the nation.

According to the CSD news release: “CalKIDS began enrolling newborns and eligible public-school students in July during its soft launch period. The enrollment, account opening, and initial deposit occur automatically, with no initial involvement required from the child or family. Infants born on or after July 1, 2022, can receive seed deposits of up to $100 in their CalKIDS account, and eligible school-age children can receive up to $1,500. The policy will continue to expand through the automatic enrollment of newborns – an estimated 450,000 each year – and approximately 250,000 eligible students in public schools each year.”

Center Director Michael Sherraden and his team at CSD provided research evidence and expertise from its groundbreaking Seed for Oklahoma Kids experiment that aided the California legislature fashion CalKids legislation. An article in the Los Angeles Times credits CSD for providing the child development account model for the new program. CSD Policy Director Margaret Clancy said the program’s key partnerships offer additional benefits for California families, cities, and community organizations, especially those providing services to financially vulnerable families. University of Michigan scholars Trina R. Shanks, and William Elliott III, are CSD Faculty Directors and major contributors to asset-building policies.

Sherraden stated: “Of interest to social workers, the CDA policy gives much larger deposits to foster kids and homeless kids, but also includes all newborns. So, it is both fully inclusive and targeted. This platform will also be the best vehicle for delivery of “Baby Bonds”, targeted deposits with a focus on the racial wealth gap because it already exists, is widely trusted, and builds assets, in contrast to current baby bonds proposals. This is a long process, but the California policy announcement is a big step forward on a policy platform that can garner bipartisan support and be sustainable.”

Sherraden began this work back in the 1980s when he says there was little discussion in policy and community development circles about asset-building strategies for the poor; the focus was mostly on income support. His book chapter, “Asset-Building Policy and Programs for the Poor,” in Thomas M. Shapiro and Edward N. Wolf’s 2001 edited book, Assets for the Poor, presented ideas on the development of individual development accounts. Sherraden wrote that major shifts in policy occur because of structural changes to society, such as the country moving from an industrial-based economy to one based on information, and that policies can also shift through the collective efforts of organizations, offices, and interest groups that act to advance policy innovation. He feels strongly that a federal CDA policy is within reach.

California is leading the nation in investing in young people. In addition to CalKids, Vice President Kamala Harris recently joined Oakland leaders to announce the Oakland Generation Fund which provides financial assistance to low-income children to help end generational poverty. The city of Oakland raised $50 million from hundreds of local and regional donors aimed to help 30,000 students and children. The fund will expand programs under Oakland Promise, a 2016 organization created by Oakland Mayor Libby Schaaf, that grants $1,000 a year to any low-income public school student who chooses to attend a high school that includes a four-year college, two-year college, and trade school.

In July, the California State Senate and Assembly unanimously passed a $35 million basic income program for youth aging out of foster care. Each emancipated foster youth will receive $1,000 monthly—no strings attached, guaranteeing the first statewide universal basic income. Policy analysts estimate the UBI will serve 2,400 to 2,500 young people exiting foster care each year. Young people leaving foster care are more at risk to experience homelessness, educational delays, and incarceration.

Leave a Comment

Your email address will not be published. Required fields are marked *