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Commentary: Those $1,000 Trump accounts don’t match the hype

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Commentary: Those ,000 Trump accounts don’t match the hype

Proponents say the Trump accounts will be better than Social Security. Don’t believe them.

Here’s a riddle for you: A conservative Republican senator, a top economic advisor to the Trump White House and a venture capitalist walk into a conference room at a financial conference and claim a new government program will be a boon for all American families.

Question: Do you think these people are looking out for your interests?

If you trust Sen. Ted Cruz, economic advisor Kevin Hassett and millionaire Brad Gerstner to do so, feel free to stop reading here.

Here’s the dirty little secret: Trump accounts are Social Security personal accounts.

— Sen. Ted Cruz (R-Tex.) reveals that Trump accounts are designed to threaten Social Security

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If you’re skeptical, read on.

But keep in mind that Cruz (R-Tex.) was last seen in these pages promoting yet another big tax break for the 1%, Hassett appeared the other day on Fox Business arguing that while Americans are spending a lot more on gasoline, “they’re spending more on everything else too” on their credit cards, as if forcing households to max out their credit is a good thing; and Gerstner is, well, a millionaire tech investor.

At their panel discussion on May 4 at the annual Milken conference, Cruz, Hassett, Gerstner and their interlocutor, Michael Milken, talked as though the Trump accounts would be so fabulous for average American families that they would obviate the need for Social Security.

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“Here’s the dirty little secret,” Cruz said. “Trump accounts are Social Security personal accounts.”

Milken echoed that thought: “Do you have the right to decide where your money goes, or should you be giving it to the government and [letting] them decide where it goes?”

That gave the game away — this is yet another effort by Republicans and conservatives to end a program they’ve been trying to kill, and to give Wall Street firms a bigger bite of your retirement resources.

Let’s start with a primer about the Trump accounts, which were part of last year’s GOP budget bill and will be open to investment starting on July 4.

The headline pitch for these accounts is that they’ll be seeded with a one-time $1,000 government contribution for children born from 2025 through 2028, unless Congress extends the government donation. Accounts can be opened for children born before or after those dates, but they won’t get the government donation.

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Families can add up to another $5,000 in contributions every year until the child reaches 18, but those donations won’t be tax-deductible.

The money must be invested in low-cost stock index funds or exchange-traded stock index funds, and can’t be withdrawn for any reason without penalty until age 18. After that, the funds can be withdrawn without penalty for certain purposes such as educational expenses or the purchase of a first home. The accounts eventually become converted to conventional individual retirement accounts, or IRAs, and distributions will be taxed as ordinary income, though family contributions will be returned tax-free.

That $1,000 donation is the best feature of the accounts. But that may be their only good feature. For almost all the financial goals confronting average American families, such as saving for college or retirement, they’re inferior to tax-advantaged savings plans already on the books.

Like those programs, they’re much more advantageous for wealthier than to low-income families: Wealthier families typically have the wherewithal to make their annual contributions, and get a larger break from the tax deferrals of investment growth within the accounts because their tax rates are higher.

Though their promoters claim that the accounts will level the economic playing field for all families — “helping the bottom 10%,” Hassett said on the panel — that’s not the case. “Clearly, the program is structured to subsidize savings for those who already have the capacity to save, rather than meaningfully closing the wealth gap,” observes Sheryl Rowling of Morningstar.

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Another drawback cited by economists and financial planners is that the accounts are locked into corporate equity investments. Before the beneficiary reaches age 18, the investment mix can’t be adjusted. That’s dangerous because portfolio concentrations in corporate shares are inherently risky.

“A high school senior who plans to enroll in college next year cannot change the investment to a lower-risk portfolio,” say, to a mix of equities and bonds, notes Greg Leiserson of the Tax Law Center at NYU. “If the market crashes the summer before she plans to enroll, the Trump Account is of greatly reduced use.”

Trump account promoters have massively overstated the potential wealth gains for ordinary Americans. At the Milken conference, Cruz said that a child with a Trump account will have about $170,000 in it when he or she reaches 18 and $700,000 at age 35. “And very quickly after that, you get into the millions,” he said.

Cruz did acknowledge that those figures apply to households that “contribute regularly.” In fact, they apply largely to households that contribute the maximum $5,000 every year.

The White House estimates of potential returns are based on questionable assumptions about stock market gains over the 18-year periods in which the accounts will grow on a tax-deferred basis.

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According to the government’s own estimates, the account of a family taking the $1,000 seed money but making no contributions beyond that would have as little as $2,577 in their account after 18 years if stock market returns come to 5.4% over that period.

The government estimates, however, that the account would hold $730,395 if the family contributes the maximum every year and the stock market returns more than 18%. Another 10 years of growth at that level, and the account would grow to $1.9 million when the child reaches age 28.

The problem with long-term market estimates, such as the ones offered by the White House, is that they’re highly variable. No 18-year periods are the same. One thousand dollars deposited in a hypothetical account invested in a Standard & Poor’s 500 index fund would grow to about $6,600 if its 18-year lifetime culminated in 2025; if the 18 years ended in 2008, however, that deposit would have grown only to $3,960. In the 18-year period that ended in 1960, the account would have grown only to $2,940. What will the next 18 years bring? Who knows?

Variability like this, along with the sheer uncertainty of stock market projections for the future, helped sink George W. Bush’s 2005 attempt to convert Social Security into private accounts, which was also pitched as a key to minting millionaires by the millions through the magic of the market.

I asked the White House to respond to these criticisms. Spokesman Kush Desai called my questions “both a stupid and out-of-touch take,” asserting that the accounts are “already shaping up to make a generational difference for working-class children.”

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The truth is that if Trump were really intent on taking steps to “strengthen the financial security of American workers” and creating a “path to prosperity for a generation of American kids,” as he claims to be, he and his GOP followers in Congress wouldn’t have scissored away the American safety net, which is what they’ve done.

They wouldn’t have imposed new work requirements and narrowed eligibility standards for food stamps, resulting in the exclusion of more than 3 million people from the program, a decline of 8%. They wouldn’t have cut nearly $1 trillion in funding for Medicaid over 10 years, jeopardizing coverage for 3.6 million young adults. They wouldn’t have allowed Affordable Care Act premium subsidies to expire, resulting in a drop in Obamacare enrollments of about 1.2 million Americans this year compared with last year.

If they really cared about educational opportunities for “a generation of American kids,” they wouldn’t have narrowed eligibility for higher education Pell grants, and wouldn’t slash research grants for universities coast to coast.

So how can families better prepare for college and retirement expenses? For education, 529 plans are probably preferable to Trump accounts. The investment choices are more flexible, withdrawals are tax-free at the federal level and sometimes at state levels if used for most education expenses, and there are no federal limits on contributions (contributions aren’t tax-deductible).

For retirement, advisers have been favoring Roth IRAs. Contributions are not tax-deductible, and this year can be made by couples filing jointly with taxable income up to $242,000 ($153,000 for singles) and are limited to $7,500 a year ($8,600 for those 50 and older). But withdrawals aren’t taxed if you’ve held the account for at least five years and you take the money out after you turn 59 1⁄2.

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The bottom line, then, is this. Take the $1,000 if your child is eligible. As Rowling wisely advises, “Any time the government offers free money, you should take it.”

As for the rest, treat any claims offered by Trump account promoters as inherently suspect.

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Trump backs MAGA champion Mike Collins in Georgia’s Republican Senate runoff

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Trump backs MAGA champion Mike Collins in Georgia’s Republican Senate runoff

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President Donald Trump on Saturday made an 11th-hour endorsement in a crucial Senate race in battleground Georgia, which is among a handful that will likely decide if the GOP holds its slim majority in the chamber in November’s midterm elections.

Trump endorsed Republican Rep. Mike Collins, a MAGA champion and strong supporter of the president, who is facing off in Tuesday’s runoff election against former college football coach Derek Dooley, who has the support of popular conservative Georgia Gov. Brian Kemp.

The winner of the GOP Senate nomination will face off in the midterms against Democratic Sen. Jon Ossoff. Republicans view Ossoff as the most vulnerable Senate Democrat seeking re-election and are heavily targeting the first-term senator.

Collins, who represents Georgia’s 10th Congressional District, which is located between Atlanta and Augusta, is the son of the late Rep. Mac Collins, and is the founder and co-owner, along with his wife, of a trucking company.

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Republican U.S. Senate candidate Rep. Mike Collins of Georgia speaks to supporters at a primary night event on May 19, 2026, in Jackson, Georgia. (Jason Allen/Getty Images)

He and Dooley, a lawyer, a former University of Tennessee football coach and the son of legendary University of Georgia head football coach Vince Dooley, were the top two finishers in a crowded field of candidates that also included Rep. Buddy Carter. Since no one topped 50% in last month’s primary, Collins and Dooley advanced to Tuesday’s runoff election.

While Collins has long showcased his MAGA credentials and support for the president, Trump remained neutral in the Georgia primary and runoff election until now.

Meanwhile, Dooley is strongly backed by the term-limited Kemp, who is a lifelong friend. Kemp and his wife, Georgia First Lady Marty Kemp, have regularly appeared with Dooley on the campaign trail, and the governor’s top political advisor is a senior consultant for Dooley’s Senate bid.

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GEORGIA GOP SENATE PRIMARY HEADS TO RUNOFF AS REPUBLICANS BATTLE TO UNSEAT OSSOFF

Georgia Residents Vote In Primary Election Derek Dooley, Republican US Senate candidate for Georgia, from left, his wife Allison Jeffers Dooley, Marty Kemp, Georgia’s first lady, and Brian Kemp, governor of Georgia, during an election night event at Park Bench Battery in Atlanta, Georgia, US, on Tuesday, May 19, 2026. (Ben Hendren/Bloomberg via Getty Images)

While Dooley has emphasized his outsider image and targeted Collins as a political insider, Collins has criticized him for a lack of political experience and for living outside of Georgia for much of his adult life.

Both candidates have some political baggage.

The House Ethics Committee has been investigating Collins over allegations he paid an intern in a district office who had a romantic relationship with his congressional chief of staff but who did not actually perform any work. Collins denied any wrongdoing and kept the staffer on his Senate campaign.

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But the staffer was later fired by Collins after taking to social media on behalf of the campaign to mock the wife of a Dooley campaign advisor who attempted suicide after accusing Matt Lauer of rape. The social media post was deleted and Collins apologized, calling the tweet “despicable and unauthorized.”

Dooley, over the past week, was reportedly accused of being part of a “pay to play” scandal involving brother Daniel Dooley, and the governor. Dooley and Kemp have denied any wrongdoing, but Democrats in the legislature requested an independent investigation.

Sen. Jon Ossoff, a Democrat from Georgia, is running for re-election in the 2026 midterms. (Aaron Schwartz/Bloomberg/Getty Images)

While the Republicans have been battling for their party’s nomination over the past year, Ossoff has built a powerful war chest that will give him a major fundraising advantage as the general election gets underway.

While he isn’t on the ballot, the president’s immense clout over the GOP is also facing another key test in Georgia’s other runoff, where Trump-backed Lt. Gov. Burt Jones is battling billionaire businessman Rick Jackson for the GOP gubernatorial nomination, in the race to succeed Kemp.

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The brute force of the president’s endorsement power has been on display in GOP primaries over the past month, with his candidates ousting incumbents he targeted in showdowns in Indiana, Louisiana, Kentucky and Texas that grabbed plenty of national attention.

But Trump’s endorsement streak in statewide and congressional Republican primaries was snapped two weeks ago when his 11th-hour endorsement of Republican Rep. Randy Feenstra of Iowa in the race to succeed retiring GOP Gov. Kim Reynolds wasn’t enough to propel the three-term congressman to victory.

Feenstra was narrowly edged by Zach Lahn, a businessman, farmer and former political strategist who was backed by the political wings of MAHA — the acronym for the Make America Healthy Again movement aligned with Trump Health Secretary Robert F. Kennedy Jr. — and Turning Point USA, the powerful conservative organization co-founded by the late Charlie Kirk.

Zach Lahn raises his fist in celebration after defeating his primary opponent in Iowa’s GOP gubernatorial race on Tuesday, June 2, 2026. (Zach Lahn for Governor via Facebook)

Trump rebounded last week, as the candidate he endorsed in the South Carolina GOP gubernatorial primary, Lt. Gov. Pamela Evette, finished first in a crowded field and clinched one of the two tickets in the race for the nomination.

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Meanwhile, longtime Trump ally Sen. Lindsey Graham did win a majority of the vote in the Republican Senate primary, and avoided a runoff.

Graham, who was endorsed by Trump, was facing primary challenges from five candidates, including conservative businessman Mark Lynch, who took aim at the senator over his support for the war in Iran. Lynch was backed by some MAGA leaders who have been critical of the president.

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Judge orders Trump administration to restore national park signage on climate change, slavery

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Judge orders Trump administration to restore national park signage on climate change, slavery

A federal judge has ordered the Trump administration to restore signs related to topics such as climate change, slavery and Indigenous and LGBTQ+ history that were removed under an executive order to purge language at national parks that allegedly cast America in a negative light.

The order has prompted the removal of mentions of President Washington’s slaves at Independence National Historical Park in Philadelphia, signs regarding climate threats at Fort Sumter in South Carolina and a pride flag at the Stonewall National Monument in New York City, according to the lawsuit challenging the action.

In California, language related to the internment of Japanese Americans at the Manzanar National Historic Site, as well as the history of Indigenous people in Death Valley and Muir Woods came under scrutiny.

A preliminary injunction was issued Friday by U.S. District Judge Angel Kelley in Boston, who sided with a coalition of conservation and historical groups and ordered all language removed under the order to be reinstated before the Fourth of July. Earlier this year, another federal judge ordered the signage related to Washington’s slaves restored.

In Friday’s injunction, Kelley accused the Trump administration of seeking “to rewrite the Nation’s history with a white-out pen,” and said that national parks play an important role in telling the multifaceted history of America, including “the good, the bad, and the ugly.”

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“Because Defendants deemed it important to strip the parks of these undeniable truths in anticipation of the 250th Anniversary of our great Nation,” she wrote, “it is equally important that our shared history be honestly told and fully restored by the 250th Anniversary to properly honor the remarkable achievements of the United States.”

A spokesperson for the U.S. Department of the Interior dismissed the ruling as the work of a “liberal activist judge.”

“The Department will look at our appeal options while we celebrate UFC Freedom 250 on the South Lawn of the White House this weekend in honor of our nation’s 250th with the greatest president in the history of our country — President Donald J. Trump,” the spokesperson said in a statement.

Trump initially signed the executive order in March 2025, arguing that a revisionist movement is seeking to undermine American history by replacing objective fact with a distorted, ideologically driven narrative.

“Under this historical revision, our Nation’s unparalleled legacy of advancing liberty, individual rights, and human happiness is reconstructed as inherently racist, sexist, oppressive, or otherwise irredeemably flawed,” the order stated.

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Under the order, more than 430 sites under the purview of the National Park Service were told to review language on monuments, memorials, statues and markers to ensure they didn’t disparage Americans past or present, with a close eye on language added during former President Biden’s administration. QR codes were also added at sites encouraging visitors to report any signs they believed violated the order.

In February, a coalition including the National Parks Conservation Assn., American Assn. for State and Local History, Assn. of National Park Rangers and Union of Concerned Scientists filed a lawsuit in federal court in Boston alleging that the order was erasing American history and science.

“National parks serve as living classrooms for our country, where science and history come to life for visitors,” Alan Spears, senior director of cultural resources at the parks conservation association, said in a February statement. “As Americans, we deserve national parks that tell stories of our country’s triumphs and heartbreaks alike. We can handle the truth.”

The Associated Press contributed to this report.

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Video: Trump’s Name Is Removed From Kennedy Center Facade

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Video: Trump’s Name Is Removed From Kennedy Center Facade

new video loaded: Trump’s Name Is Removed From Kennedy Center Facade

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Trump’s Name Is Removed From Kennedy Center Facade

Workers removed President Trump’s name from the John F. Kennedy Center for the Performing Arts on Saturday following a judge’s order.

“Even though we can’t see it yet, I’m just really, really feeling hopeful right now. I also hope that it falls, like, right now.” “Take it down, take it down, take it down.” “Now this tarp, that’s a Trump thing. Covering it up, not wanting the public to see his name come off of this vanity project that he has created.”

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Workers removed President Trump’s name from the John F. Kennedy Center for the Performing Arts on Saturday following a judge’s order.

By Cynthia Silva

June 13, 2026

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