Connecticut
CT ‘baby bonds’ program discussed at Federal Reserve conference
Connecticut officials joined advocates and researchers at the Federal Reserve on Thursday to talk about the state’s trailblazing ‘baby bonds’ program, and how it might ultimately serve as a proving ground for efforts around the country.
The program, which launched in July 2024, invests $3,200 on behalf of babies enrolled in Connecticut’s Medicaid program, HUSKY. More than half the babies born in Connecticut are to mothers on Medicaid, and around 15,600 babies are expected by be enrolled in the program annually. Eligible participants live in every one of the state’s cities and towns.
Connecticut is so far unique in passing sustained, state-level support for the concept, but small experiments are popping up around the country, including one through private philanthropy in Georgia and a temporary program for children in foster care in California who were impacted by COVID. Several other states, including New Jersey and Massachusetts, are considering baby bonds-type programs.
The conference Thursday kicked off with a conversation between Connecticut State Treasurer Erick Russell and Darrick Hamilton, a professor at The New School and an economist who is credited with helping to create the concept. They discussed Connecticut’s first in the nation program, and how it may be planting the seeds of a national movement.
“We’re building political momentum, we start local,” said Hamilton, who is the founding director of the Institute on Race, Power and Political Economy at The New School. “But at the end of the day, to make this come into fruition, we’ve really got to get the federal government involved to ensure that all children of the United States will be able to get into that vehicle of wealth building.”
Russell spoke about his childhood growing up in New Haven, sweeping the floor and working the register after school at his parents’ store. No one he knew as a kid owned their own home and working paycheck to paycheck was a way of life.
Russell said he is trying to end poverty in Connecticut, and baby bonds are but one of many strategies required to achieve that goal.
“We understand that baby bonds, by itself, is not the solution to that problem,” Russell said. “This is a piece to the puzzle as we continue to make key investments in things like education and early child care and bringing down the cost of housing.”
Baby bonds can provide funds for a down payment on a home, money to open a business or pay for school. But officials said the existence of the funds may also help in less obvious ways: baby bonds can encourage a family to imagine a child’s future and plan for it. The funds could stave off gentrification by creating a cohort of people who are able to cash in at around the same time and even pool resources to support their neighborhood. And they help link parents to state supports through a positive vehicle.
“There’s a huge lack of trust between members of the community and government,” Russell said. “Now we actually have this positive way of connecting with people, right? Connecting with parents who are saying, ‘My child is going to have access to this resource and this opportunity that I could have never imagined.’”
A recipient must be between 18 and 30 years old to use the funds, pass a financial literacy test, and be a Connecticut resident. That money is expected to eventually be worth at least $11,000 and as much as $24,000, depending when the recipient chooses to cash in the bond.
Though the initiative received strong support from many political leaders, Gov. Ned Lamont nearly killed the program in 2023. The decision to draw from a surplus in Connecticut’s special reserve fund instead of borrowing money, as was originally planned, allowed Lamont and Russell to reach a compromise and the program was finally launched in July 2023. In fact, as Russell mentioned during the conference, the so-called baby bonds ended up not being bonds at all.
At Thursday’s event, the history of political infighting wasn’t discussed. Rather, advocates and researchers focused on the promise of the program and the synergy with another initiative: ‘guaranteed income.’
Stanford University researchers Max Rong and David Grusky explained why, based on their research modeling, simultaneously offering families guaranteed income and baby bonds may be a superior approach to offering a more generous version of only one of these programs.
The researchers said that guaranteed income can prove meaningful to help families from falling into poverty, relieving the stress of financial pressure from caregivers so they can form healthy attachments with their children and afford day to day expenses that keep them healthy and safe. However, just providing that cash is unlikely to allow a family to save the kind of money they need to ultimately open a business, buy a home, afford higher education and ultimately build generational wealth. On the other hand, a single infusion of money — a cashed-in baby bond— cannot undo years of underinvestment.
“You might think it doesn’t matter if you just do one or the other,” Grusky said. “What this suggests is that, given data about how the world works, you actually need both.”
Laura Clancy, the executive director of The Bridge Project, a guaranteed income program for new moms which recently launched in Connecticut, asked the room to simply trust mothers, who tend to have good judgment about what their kids need. She ended her panel by encouraging the audience to consider the power of imagination in initiatives like baby bonds and guaranteed income, and how thinking outside the box might help us upend the inequities we take for granted.
“What have we come to accept that is unacceptable?” she asked.
Connecticut is taking a step to make sure workers are paid fairly.
On June 30, Connecticut Governor Ned Lamont signed Public Act 26-17, which enables the State Comptroller to issue a stop work order and withhold state funds to contractors that are not properly paying their employees.
The bill was signed on the construction site for Greeneville Elementary School, which is one of the four new elementary schools being built in Norwich. The State of Connecticut is reimbursing the city for 80% of the project, and the law applies to “any place where the state is making a payment,” Lamont said.
Wage theft can take many forms
It matters because wage theft can take many forms, from money taken from base pay, to money not given in benefits, Kimberly Glassman, director of compliance and government affairs for the International Union of Operating Engineers Local 478, said.
Local 478 also has a presence in the Norwich school building project, with 10 to 20 union members working at each site daily, Glassman said.
What do state leaders think of the Greeneville site’s progress?
Lamont is impressed with how quickly the work is going.
“They told me that the walls went up in the last two weeks, so a lot of progress is happening,” he said.
During the bill signing, Norwich Mayor Swarnjit Singh touted the importance of using union labor and the value of project labor agreements.
“We are on time and on budget,” he said.
After the bill signing, Singh said its possible the Greeneville School building could be complete as soon as the first quarter of 2027, he said.
“They’re not wasting any time,” Singh said.
State Rep. Derrel Wilson attended the original Greeneville School as a kid, and still lives in Greeneville. He was credited as being one of the driving forces for getting the workers bill passed.
“It’s exciting seeing this revitalization for our neighborhood, seeing active construction and watching individuals rebuild our community,” Wilson said.
HARTFORD, Conn. (WFSB) – The U.S. Supreme Court said Tuesday it will take up an appeal challenging bans on the AR-15 and other semi-automatic firearms, including the ban in Connecticut and in the Chicago area.
Similar bans are in place in about a dozen states. The case is expected to be heard in the fall.
Connecticut Attorney General William Tong said the state’s assault weapons ban is lawful and that his office is prepared to fight the challenge in court.
“Connecticut’s assault weapon ban is lawful, lifesaving, and broadly supported. The gun lobby has flooded the courts in states across the country to get an assault weapons case up to this Supreme Court. We are prepared for this fight, and we are going to go in with everything we’ve got to keep these weapons of war off our streets, out of our schools, and away from our families,” said Attorney General Tong.
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