ANOTHER SENATE PROPOSAL THAT WOULD RAISE THE ESTATE TAX, BUT THIS TIME TO DIRECTLY FUND A NEW ENTITLEMENT

A U.S. Senator recently announced a plan that would give each new American baby a savings account of $1,000.  Each of those children who is in a family with income under certain limits would receive an additional deposit to his or her account each year.  The amount of those deposits would be progressively smaller as the family income increases.  
The account would not be accessible until the child reaches age 18, and then would only be available for certain purposes, such as home ownership and higher education.  Sorry kids, no Corvette at age 18 (although I haven’t seen any explanation of how the limitations on the use of the account would be enforced).  
The distinguishing characteristic of this proposal is that funds for a direct benefit to one group of taxpayers would come solely from a tax on another group of taxpayers.  The funds for the proposed accounts would come from an increase in the estate tax, according to the proposal.  
Senators have already floated one proposal this year for increasing the estate tax, but this proposal is qualitatively different.  Has the federal government ever taxed one group to fund a direct benefit to another group?  I could be wrong, but I don’t think so.