American Prosperity and Stability Act¶
Overview¶
Published February 2026¶
Based on Rev 4.8 of the American Prosperity and Stability Act
Problem Statement¶
The American economy generates unprecedented aggregate wealth while failing to deliver financial stability to most of its participants. Nearly half of American adults lack savings to cover three months of expenses. Even households with two earners often cannot absorb modest disruptions -- a car breakdown, a medical bill, a seasonal layoff -- without crisis. Housing, healthcare, childcare, and education costs have outpaced wage growth for decades, compressing the financial runway that families need to plan, invest, and build.
This instability is not simply an economic problem. It shapes family formation decisions, geographic mobility, educational attainment, labor market dynamics, and political behavior. When financial survival dominates daily life, democratic participation becomes a luxury. Fear converts to resentment, resentment to division, and division to institutional fracture. Stabilizing individuals and families is a precondition for stabilizing democracy.
Solution Architecture¶
The American Prosperity and Stability Act (APSA), hereafter referred to as "the Act," creates a single integrated system with two components that reinforce each other. The American Prosperity Stability Payment (APSP) provides monthly income to eligible adults. The American Prosperity Contribution (APC) funds the system through a broad contribution on domestic consumption. Together they form a stability feedback loop: the APC generates predictable revenue; the APSP translates that revenue into household financial security; stable households generate stable consumer demand; stable demand sustains APC revenue.
The design reflects several deliberate choices. The system is funded through consumption rather than income, avoiding disincentives to work, hiring, or wage growth. Benefits are calculated on an individual basis, ensuring marriage neutrality. All thresholds are anchored to Federal Poverty Level multiples, enabling automatic indexing without annual Congressional action. And a Bridge Period funding mechanism delivers benefits within months of enactment rather than requiring years of APC phase-in before anyone receives a payment.
Major Provisions¶
Benefit Structure. The APSP combines two elements. A baseline payment of $200 per month goes to all eligible adults below the clean exit threshold, creating broad political constituency and covering the typical APC contribution burden for middle-income households. An income-adjusted stability payment of up to $428 per month provides additional support that tapers gradually using a logarithmic formula as income rises. At zero income, the combined maximum benefit is approximately $628 per month ($7,530 per year), anchored at 50% of the Federal Poverty Level. The stability payment reaches zero at 7x FPL (approximately $105,420), above which recipients receive only the $200 baseline until the clean exit threshold at 10x FPL (approximately $150,600). Adults above this threshold and those with net worth exceeding $5 million receive no payment. Approximately 90% of American adults fall below the clean exit threshold.
Funding Mechanism. The APC is a 12% contribution on goods and services sold for domestic use, collected at the value-added stage. Essential categories -- housing, healthcare, education, and financial services -- are exempt, enhancing progressivity without complex rebate systems. The APC is border-adjusted, zero-rating exports and applying equally to imports. At full implementation, the 12% rate generates approximately $1.56 trillion annually. Revenue is split 80/20 between federal APSP operations and state revenue sharing.
Bridge Period. Benefits begin accruing on the day of enactment, funded through a hybrid of bounded deficit financing (40%, capped at $400 billion), temporary progressive bridge taxes (30%), and early APC collection at a reduced rate (30%). Bridge taxes -- an income surtax on high earners and a corporate surtax on large firms -- sunset automatically when the Bridge Period ends. All borrowing carries a statutory repayment obligation from APC surplus, estimated at 6-8 years. The Bridge Period ends when APC revenue self-funds APSP obligations for two consecutive quarters and the Stability Buffer reaches its minimum reserve.
Federal-State Revenue Sharing. Twenty percent of APC revenue (approximately $312 billion annually at full implementation) flows to state governments distributed by pure population share. States retain complete autonomy over allocation, with transparency ensured through standardized annual reporting and a public comparison dashboard. An enforcement ladder for non-reporting escalates from technical assistance through escrowed funds to penalties redistributed to compliant states.
Rapid Deployment. Tax filers with direct deposit on file are targeted for enrollment within 90 days; SSA beneficiaries within 120 days; non-filers with earnings history within 180 days; and all remaining eligible adults within 12 months. Benefits accrued before enrollment completion are held in trust and delivered retroactively. Non-filers can establish eligibility through a one-page Simple Form available at SSA offices, libraries, post offices, and online.
Fiscal Safeguards. A Stability Buffer maintains reserves of 6 to 12 months of projected outlays. If the buffer falls below the 6-month minimum for two consecutive quarters, the APC rate automatically increases by 0.25 percentage points, up to a 2-point cumulative cap. Automatic increases reverse when reserves recover. A solvency trigger requires Congressional notification and action if reserves are projected to exhaust within 18 months.
Program Interactions. APSP eligibility uses Adjusted Gross Income as defined by the Internal Revenue Code, inheriting existing tax definitions without creating parallel measurement systems. Permanent disregards protect SSI and TANF recipients from cliff effects. Programs that adjust gradually with income -- SNAP, Medicaid, Section 8 -- require no special treatment. All existing benefit programs continue during phase-in, with program consolidation considered only after APSP reaches operational maturity.
Implementation Overview¶
The Act phases in over five years alongside APC rate escalation: 6% in years 1-2, 9% in years 3-4, and 12% from year 5 forward. The baseline payment ($200/month) is paid in full from the Launch Phase; only the stability payment scales with the APC rate. This ensures meaningful benefits from the beginning while the full system reaches steady state.
Administration operates through existing federal infrastructure. The IRS handles eligibility determination and APC collection; the Bureau of the Fiscal Service manages payment distribution, state revenue sharing, and the Stability Buffer; and the Treasury Inspector General provides oversight. An American Prosperity Oversight Council -- comprising the Treasury Secretary, IRS and SSA Commissioners, presidential appointees, and Congressional appointees -- monitors system performance and recommends adjustments.
When the American Payment Network Act (APNA) is operational, APSP payments flow through Network Accounts. If APNA is not enacted, the Act includes standalone provisions for delivery through direct deposit, Direct Express cards, or paper checks.
Conclusion¶
The American Prosperity and Stability Act establishes economic infrastructure rather than a transfer program. Shared contribution through the APC funds shared stability through the APSP. The design prioritizes durability -- automatic indexing, fiscal buffers, and broad political constituency rather than dependence on annual legislative maintenance. The result is a system where nine in ten American adults have a direct stake in its success, states have a fiscal interest in its continuation, and the economic conditions that fuel democratic instability are structurally addressed.
Revision History¶
Revision 1.1 (Current)
- Renamed file from APSA-Rev-4-7-Overview.md to overview.md per APAI Document Production Standards Rev 1.6 Section 1.1
- Updated reference line to APSA Rev 4.8
- Added self-reference establishment per Section 1.7 ("hereafter referred to as 'the Act'")
- No changes to policy substance or analytical content
Revision 1.0 - Initial publication based on APSA Rev 4.7
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Prepared by Albert Ramos for The American Policy Architecture Institute