Time to Sow Seeds, Not to Space Out

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Now that the federal budget deficit is out of this world at $500 billion and counting, President Bush wants to put down a billion-dollar deposit for a manned trip to Mars. The full fare over the next 16 years, say experts: $1 trillion.

Compare that white-collar jobs extravaganza for the aerospace industry with the well-grounded need for the Saving for Education, Entrepreneurship and Downpayment (SEED) Policy and Practice Initiative germinating in 10 communities, from New Haven, Conn., to San Francisco.

The SEED effort, managed by the Corporation for Enterprise Development (CED), will test the viability of setting up partially publicly funded Individual Development Accounts (IDAs) for every American child.

Why? Because each year 4 million American children are born, almost two-fifths of them into families with few assets beyond next month’s rent and the price of one of those chocolate Mars bars Saddam Hussein had on hand when he was captured.

SEED’s 10 sites will use various financial instruments to encourage poor families to set up savings accounts for their children. More than 1,100 children will receive up to $2,000 in inducements to save for the day they turn 18. Then they can spend the money on further education, homes or other purposes that are deemed to be sound.

Four of the groups implementing SEED are rooted in youth work: Harlem Children’s Zone in New York, Boys & Girls Clubs of Delaware, JUMA Enterprises in San Francisco (a spin-off of the Larkin Street Youth Center) and the Mile High United Way in Denver.

In Denver, the United Way will work with Young Americans Bank (yes, it’s an FDIC-insured commercial bank) and the Jim Casey Youth Opportunities Initiative to set up accounts for 50 foster teens. In Delaware, the Boys & Girls Clubs will enroll 75 adolescents. Each youth who saves $1,000 and attends financial education classes will wind up with more than $3,000 in savings at age 18 – and, it is hoped, the good habits of thrift to last a lifetime.

Turning poor kids into asset-holding stakeholders in the nation’s economic and civic life is as worthy of support as an expedition to outer space. By 2020, when the president hopes an astronaut will stride on Mars (named after the god of war), some 25 million poor kids could, through IDAs, have a sound financial education and modest assets to create their own entrepreneurial opportunities.

Providing IDAs for all would be expensive. But consider that even though the White House and Congress have decreed that budget deficits don’t matter, we’re going to need every young hand on deck in 2020 to pick up the tab for today’s budget follies.

The Corporation for Enterprise Development estimates that every child in a low-income family could have an IDA for about $5 billion per year. That total price tag of $80 billion by 2020 is just 8 percent of what the president wants to spend over the same period to hit pay dirt of dubious value on Mars.

Britain – remember, they have an army in Iraq, too – recently launched the Child Trust Fund, a financial asset-building program for youth. At birth, every British child receives a “Baby Bond” account that starts at $400 and rises to $800 for the poorest children. Parental contributions to custodial accounts are matched periodically by the government. Come 2020, even today’s poorest British child will have an IDA of about $7,000.

The British venture is modeled on a similar program in Singapore, which virtually guarantees that no child in that small nation of 4.2 million people grows up in poverty.

There are other youth-focused IDAs in the United States, such as the one run by the Jackson, Miss.-based Foundation for the Mid South. That program has enrolled 1,716 low-income people. It has helped 400 savers purchase homes, start new businesses and pursue further education.

In Portland, Ore., the REACH Community Development Corp. has a tiny IDA program for youth, as does the Latin American Youth Center in Washington, D.C.

Of course, eliminating childhood poverty doesn’t have the awesome entertainment possibilities of that ultimate adult toy – a rocketship to Mars. Space exploration may swell national pride, but aren’t sound social programs like SEED more likely to build sustained pride in our nation’s accomplishments?

What’s of lasting value in the heavens, we don’t know. But Jesus says in Matthew 3:31, “The kingdom of heaven is like to a grain of mustard seed, which a man sowed [invested!] in his field. Which indeed is the least of all seeds: “but when it is grown, it is the greatest ...”

Mr. President, leave the astronauts behind. Invest in kids. That would be shooting the moon.