Billionaire Says Government Should Give People Cash At Birth So They Can Retire As Millionaires
I think all of us have daydreamed about get-rich-quick schemes that will allow us to retire lounging on a beach, instead of working that 9-to-5 grind until death grinds us down.
But, one billionaire has come up with his own idea, which he believes will allow every American citizen to retire as a millionaire, while tackling the huge issue of wealth inequality in the states.
Bill Ackman, CEO of Pershing Square Capital Management has proposed a new scheme that would see the government handing over cash to every single newborn American.
The ‘birthright’ scheme is designed even out the wealth inequality problem in the states, by allowing those ‘with no investment assets to participate in the success of capitalism.’
‘To do so, we need a programme that makes every American an owner of the compound growth in value of corporate America,’ he explained in The New York Times.
‘The government could fund investment accounts for every child born in America, a programme we could call Birthright.’
The programme would invest in zero-cost equity index funds, which would prevent the owners from withdrawing from the pot until their retirement, meaning it would compound tax-free for 65 years or more.
Typically, Americans see equity returns of 8% annually, meaning an initial investment of $6,750 at birth, could be worth more than $1 million by a retirement age of 65, or up to $2 million by the age of 74.
Based on the average number of births in the US each year, the scheme would cost the American government around $26 billion annually.
Ackman knows what he’s talking about when it comes to investment. The 54-year-old managed to make an eye-watering $2.6 billion from the coronavirus market crash, after investing $27 million back in March.
‘The American dream has become a disappointment, or worse, for too many,’ he continued.
‘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.’
However, this universal basic income (UBI) scheme isn’t entirely new. Former presidential candidate Andrew Yang proposed his own UBI programme titled Freedom Dividend in 2019, which consisted of paying Americans $1,000 a month, or $12,000 a year after they turn 18.
An increasing number of countries have considered implementing UBI schemes that would ensure a minimum wage for everyone in the country, off the back of the economic fallout caused by the ongoing pandemic.
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CreditsThe New York Times
The New York Times