Promoting Economic Equity in 2020 and Beyond February 25, 2020 - - PowerPoint PPT Presentation

Promoting Economic Equity in 2020 and Beyond

February 25, 2020

Prosperity Now’s mission is to ensure everyone in our country has a clear path to financial stability, wealth and prosperity.

Housekeeping

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Today’s Speakers

Emanuel Nieves

Associate Director, Policy

Vanna Cure

Senior Advocacy Manager

Today’s Agenda

✓ Overview of Wealth Inequality in America ✓ The Case for Bold Policy Solutions ✓ Designing Baby Bonds to Promote Economic and Racial Justice ✓ Prosperity Now Tax Campaign Priorities ✓ Group Discussion and Q&A ✓ Next Steps & Close

Poll Question Are you currently working on policy issues to address wealth inequality?

▪ Yes, at the federal level ▪ Yes, at the state level ▪ Yes, at the municipal level ▪ No

(Use the poll tool on your screen to record your answer.)

Wealth Inequality in America: An Overview

Emanuel Nieves

Associate Director, Policy

Distribution of Household Wealth in the U.S

Source: Federal Reserve, Survey of Consumer Finances and Financial Accounts of the United States

61% 70%

35% 29%

25% 30% 35% 40% 45% 50% 55% 60% 65% 70% 75%

Share of Household Wealth, by Wealth Percentile I 1989:Q3 — 2019:Q3

Top 10% Middle 40%

Distribution of Household Wealth in the U.S

61% 70% 4% 2% 0% 15% 30% 45% 60% 75%

Share of Household Wealth, by Wealth Percentile I 1989:Q3 — 2019:Q3

Top 10% Bottom 50%

Source: Federal Reserve, Survey of Consumer Finances and Financial Accounts of the United States

Distribution of Household Wealth in the U.S

61% 70% 35% 29% 4% 2% 0% 15% 30% 45% 60% 75%

Share of Household Wealth, by Wealth Percentile I 1989:Q3 — 2019:Q3

Top 10% Middle 40% Bottom 50%

Source: Federal Reserve, Survey of Consumer Finances and Financial Accounts of the United States

Distribution of Household Wealth in the U.S

$ $20 $40 $60 $80 $100

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Level of Household Wealth, by Wealth Percentile I 1989:Q3 — 2019:Q3

Bottom 50% Middle 40% Top 10% Source: Federal Reserve, Survey of Consumer Finances and Financial Accounts of the United States Trillions

Distribution of Household Wealth in the U.S

$ $20 $40 $60 $80 $100

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Level of Household Wealth, by Wealth Percentile I 1989:Q3 — 2019:Q3

Latinx Black White Trillions Source: Federal Reserve, Survey of Consumer Finances and Financial Accounts of the United States

Household Wealth in the U.S

$3K $6K $141K $17K $21K $171K $K $20K $40K $60K $80K $100K $120K $140K $160K $180K Black Latinx White

Median Wealth by Race I 2016

without durable goods with durable goods

Source: Federal Reserve, Survey of Consumer Finances (wealth with durable goods), Edward N. Wolff, Household Wealth Trends in the United States, 1962 to 2016: Has Middle-class Wealth Recovered? (wealth without durable goods)

• 50%

0% 50% 100% 150% 200% 250% 300% 350% 400% 1989 1999 2009 2018

S&P 500 and Real Family Income Between 1989 and 2018, as a percentage of 1989 levels

S&P 500 Real Average Household Incomes Real Median Household Incomes

Stocks vs Income

Percent Share of Total U.S. Assets Held

49% 39% 85% 20% 51% 61% 15% 80% 0% 20% 40% 60% 80% 100% Pension/Retirement Accounts Real Estate Stocks and Mutual Funds Total Debt

By Asset Class and Wealth Percentile I 1989:Q3

Top 10% Bottom 90% 54% 45% 88% 25% 46% 55% 12% 75% 0% 20% 40% 60% 80% 100% Pension/Retirement Accounts Real Estate Stocks and Mutual Funds Total Debt

By Asset Class and Wealth Percentile I 2019:Q3

Top 10% Bottom 90% Source: Federal Reserve, Survey of Consumer Finances and Financial Accounts of the United States

Composition of Household Wealth

12% 23% 23% 21% 5% 6% 26% 38% 6% 11% 35% 26% 0% 5% 10% 15% 20% 25% 30% 35% 40% Private Businesses Stocks and Mutual Funds Real Estate Pensions

By Race/Ethnicity I 2019:Q3

White Black Latinx Source: Federal Reserve, Survey of Consumer Finances and Financial Accounts of the United States

SOURCE I Prosperity Now analysis of Office of Management and Budget data

The Rising Cost of Upside Asset / Wealth-Building Programs

The Rising Cost of Upside Asset / Wealth-Building Programs

Designing Baby Bonds to Promote Economic and Racial Justice

Enrollment and Age of Eligibility

• At birth and possibly before the age of 13
• Automatic enrollment

Administration and Account Structure

• Administered by a central entity – the U.S. Department of the

Treasury

• Funds invested in U.S. Treasuries

Seed Amount and Deposits

• Lump sum at birth
• Universal sum at birth, followed by tiered deposits

Designing Baby Bonds to Promote Economic and Racial Justice

Allowable Uses of Funds and Age of Disbursements

• Higher education
• Homeownership
• Entrepreneurship

Cost Estimate and Funding

• $60 - $100 billion per year
• Upside-down tax expenditures

✓ Bills have been introduced in the House and Senate

✓ American Opportunity Accounts Act (Sen. Booker/ Rep. Pressley)

• Drum up as many co-sponsors as possible

in both chambers

• Build momentum for the 117th Congress

2020 Advocacy Goals for Baby Bonds

What Can You Do?

2020 Right-Side Up Tax Campaign Priorities

• GOAL: Fund VITA

Program at $30 million in FY21

2020 Right-Side Up Tax Campaign Priorities

• GOAL: Co-

sponsorships and passage in the House

Audience Q & A

What questions do you have?

Share them in the Questions box!

Vanna Cure | Senior Advocacy Manager

vcure@prosperitynow.org

Emanuel Nieves| Associate Director, Policy

enieves@prosperitynow.org

Stay in Touch!

Next Steps and Wrap Up

Vanna Cure

Senior Advocacy Manager Prosperity Now

Next Steps

▪Please complete the survey! ▪ Explore new state and Congressional district Scorecard data: https://scorecard.prosperitynow.org/ ▪ Visit our online Advocacy Center at https://prosperitynow.org/take-action

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