"Bringing the Future Nearer": Building the Wealth of Low & Middle Income Americans

Yesterday, Phil Longman and Dana Goldstein spoke with Minnesota Public Radio about their recent contributions to the July/August issue of the Washington Monthly. The issue, The Future of Success, features a package of articles looking at a range of innovative ways to incorporate asset-based ideas into U.S. policy with an eye toward improving economic security for low- and middle-income Americans.

Listen to their full conversation here:

Despite the emphasis on the campaign trail on job creation, even a return to higher employment rates will not fully address household-level economic problems. Addressing the erosion of household wealth, particularly from families in the bottom half of the distribution, requires a more targeted approach. One of the key policy proposals Longman hones in on is the American Stakeholder Account. By giving children savings accounts at birth and providing an initial deposit for the lowest-income kids, Longman argues that we can create a supportive infrastructure to develop a culture of thrift and savings from an early age.

Goldstein's investigation of the research on children's savings accounts supports this model. She highlights findings from Willie Elliott and others that suggest a strong predictive link between savings account ownership for kids and college attendance. She points out that with 80% of kids anticipating they'll attend college but far fewer attending, we're not doing enough as a society to follow through with meaningful support for the messages we send kids about the importance of academic achievement.

MPR's callers peppered Longman and Goldstein with questions on a range of key issues, such as the role of financial education in schools, the generational impact of inheriting wealth, and alternatives to the stock market for building wealth. Goldstein noted the role community banks and credit unions used to play in school settings has faded, and emphasized a key finding of the research: account ownership helps bring "the future nearer" for students. She also touched on the recent accouncement from the Department of Education of a College Savings Account Demonstration which will compare students with accounts to those without. Longman emphasized that indeed the stock market should not be viewed as the sole way to build wealth and identified a few other strategies from the Washington Monthly issue that would help ordinary Americans monetize their existing assets.

Read their articles, listen to the full conversation, and let us know what you think about the ideas they put forth.

Also be sure to check out the video footage of our recent event "Jobs are Not Enough" that featured the release of the Washington Monthly issue with Longman, Goldstein joining several other contributors on two panels.