An economist has a wild proposal to give all kids in the US up to $60,000 at birth

Education is often considered the great equalizer, the tonic that will erase all injustice and inequality. As Nelson Mandela once said, "education is the most powerful weapon which you can use to change the world."

But economist Darrick Hamilton is calling for a fact check on the old stay-in-school, study hard advice.

Hamilton, a professor of economics and urban policy at The New School, believes a good education won't get you very far without some cold, hard cash, to go along with it.

"Wealth is the paramount indicator of economic security and well-being," Hamilton told a crowd at the TED conference headquarters in New York City last week, as world leaders were gathering nearby at the United Nations general assembly.

In the US, Hamilton is advocating for a new kind of federal cashflow pipeline — a wildly ambitious trust fund scheme that would endow every single American baby with a nest egg of cash, retrievable when they reach adulthood. It's essentially like social security in reverse, "an economic birth right to capital for everyone," as he put it.

"Without capital, inequality is locked in," Hamilton said. "It is time to get beyond the false narrative that attributes inequalities to individual personal deficits, while largely ignoring the advantages of wealth."

He asserts that what's "glaringly missing" from our current narrative about success is the role of power and capital in society, and how they each can be used to "alter the rules and structure of transactions and markets in the first place."

In the US, for example, the top 10% of earners hold about 75% of the wealth in the country, and the wealth gap disproportionately hits people of color, like Hamilton, extra hard.

That inequality trickles down from one generation to the next. Today, race is the single greatest predictor of a child's economic opportunity in the US, and things are only getting worse, as gains in the economy in recent years are going straight to richest among us, while the American worker's wages have stagnated.

Hamilton thinks adding in cash to the equation could help push society into fairer territory, so the American Dream really is more available to everyone.

The cash could finance all sorts of important life-making decisions, including private education; a decent health care safety net (health care costs are the number one cause of bankruptcy in the US); and a home in a good neighborhood.

The average endowment under Hamilton's new plan would be around $25,000 per kid, which would rise to $60,000 for the poorest children in America. Those born into the wealthiest tax brackets would not be excluded from the trust fund scheme, and every child in the US would get at least $500.

The money would be set aside in federally-managed coffers, growing around 2% a year (to adjust for inflation) until the kids reach adulthood. At that point, they'd decide what kinds of "asset-enhancing activity" they want to invest in for themselves, whether it be higher education, a new home, or their own business.

The baby trust idea is not a full-blown proposal at this point, and even Hamilton admits there are "many details" yet to be worked out.

But at it's essence, it's the promise of a social safety net that could allow more Americans to take the financial risks that allow them to reach for their dreams, without worrying they might go broke in the process. President Trump certainly benefitted from that kind of trust fund system, which made him a millionaire at age 8, according to a new report out Tuesday in The New York Times.

Whether the baby trust plan is the best way to combat income inequality is still up for debate. One 2008 report from the National Bureau of Economic Research argued that the single greatest cause of rising income inequality in the US is skyrocketing CEO pay, which has been going up at a breakneck pace that isn't in line with the rest of the economy. Others suggest that closing tax loopholes for the rich, or even providing a guaranteed minimum income could help correct the problem.

The cost of the new baby-funding plan is estimated at around $100 billion a year. As Hamilton is quick to point out, that's "far less than the $500-plus billion that's already being spent by the federal government on asset promotion through tax credits and subsidies."