Treasury Secretary Scott Bessent suggested Wednesday that a newly created children’s savings program may serve as a pathway to privatizing Social Security.
Speaking at a forum hosted by conservative news outlet Breitbart, Bessent said the program, established under the former president’s sweeping tax cuts and spending law, could act “in a way, [as] a backdoor for privatizing Social Security.”
A Treasury Department spokesperson told Newsweek via email, “Trump Accounts are an additive government program that work in conjunction with Social Security to broaden and increase the savings and wealth of Americans. Social Security is a critical safety net for Americans and always will be. This Administration has not just fought tirelessly for seniors but is also fighting for the next generation. Under President Trump’s leadership, more Americans will reap the benefits of our booming economy than ever before.”
Why It Matters
The initiative, dubbed “Trump Accounts,” allows for the creation of savings accounts for newborns in the United States, each potentially seeded with a $1,000 contribution from the U.S. Treasury. While supporters frame the program as a bold new tool to promote long-term financial security, critics see a broader agenda.
Democrats swiftly condemned the remarks. “Trump is now coming after American seniors with a ‘backdoor’ scam to take away the benefits they earned,” said Democratic National Committee spokesperson Tim Hogan in a statement to the Associated Press.
The comments have reignited Democratic warnings that Republican plans could undermine the traditional Social Security system.
Associated Press
When Does the Big, Beautiful Bill Go Into Effect?
The One Big Beautiful Bill Act has various parts set to take effect at different times, with the earliest beginning in the 2025 tax year.
What Are ‘Trump Accounts’ and Who Is Eligible?
“Trump Accounts” are tax-deferred investment accounts. Under the program, newborn American children will receive a one-time government contribution of $1,000. The accounts will track a stock index and allow for additional private contributions of up to $5,000 per year, according to the White House.
How Does the Bill Impact Seniors?
The One Big Beautiful Bill Act includes a provision to raise the standard deduction for seniors aged 65 and over by up to $6,000 between 2025 and 2028. The White House said it is “the largest tax break in history for America’s seniors.”
Karla Dennis, a tax adviser and the CEO of the tax strategy firm KDA Inc., previously told Newsweek that the plan is a “short-term fix.”
“In the end, we need real change that lasts, not just one-time payouts. Seniors deserve long-term relief they can count on,” Dennis said.
What People Are Saying
Treasury Secretary Scott Bessent, at a forum hosted by Breitbart: “If, all of a sudden, these accounts grow and you have in the hundreds of thousands of dollars for your retirement, that’s a game-changer, too.”
DNC spokesperson Tim Hogan, in a statement to the Associated Press: “Donald Trump’s Treasury Secretary Scott Bessent just said the quiet part out loud: The administration is scheming to privatize Social Security.”
What Happens Next
“Trump Accounts” will be available to all children who are U.S. citizens starting in July 2026, CNBC reported.
This article includes reporting by the Associated Press.
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Update 7/30/25, 4:21 p.m. ET: This article was updated with additional information.
Update 7/30/25, 5:35 p.m. ET: This article was updated with additional information and remarks.
