American billionaire outlines plan to give everyone cash from birth to become millionaires
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An American billionaire has outlined a plan to give everyone cash from birth so they can retire as millionaires.
Investor Bill Ackman has proposed a “Birthright” scheme where the US government would give every newborn a stock investment.
“A potential solution to the wealth inequality problem is to create a way for those with no investment assets to participate in the success of capitalism,” Mr Ackman wrote in the New York Times.
"To do so, we need a program that makes every American an owner of the compound growth in value of corporate America.
“The government could fund investment accounts for every child born in America, a programme we could call Birthright.”
The funds would be invested in zero-cost equity funds and people would not be allowed to withdraw it until they retired or turned 65.
At historical rates of return on equity of 8 per cent a year, a $6,750 grant at birth would be worth more than $1 million at the age of 65.
And that figure could be worth $2 million at the age of 74.
The scheme would cost the government around $26bn a year based on the average number of children born in the US.
Mr Ackman, the CEO at hedge fund Pershing Square Capital Management, spelled out his plan in an article for the newspaper’s DealBook section.
He said he had developed the idea as “the American dream has become a disappointment, or worse, for too many.”
“In addition to helping all Americans build wealth for retirement, Birthright would encourage greater financial literacy, and give all Americans the opportunity to participate in the success of capitalism,” wrote Mr Ackman.
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