Treasury Secretary Spills The Tea On Social Security Privatization Scheme

Speaking at a live-streamed Breitbart event Wednesday, Treasury Secretary Scott Bessent crowed about the Trump (formerly MAGA) accounts established by the Big Ugly Bill, and how they would be a back door into privatizing Social Security.

For those who are unfamiliar with these Trump accounts, they function in a similar fashion to IRAs, in that up to $5,000 per child can be deposited each year for them from employers or individuals. The government will also deposit $1,000 per child born during 2025 through 2028. The funds are tax-deferred, restricted from withdrawal until age 59, or for the purchase of a home or college expenses. But here's the catch: They MUST -- not may, MUST -- be invested in stock index funds.

For perspective on this, think about IRA accounts or 401k plans. In those plans, you are permitted to spread your investments around to minimize risk, so that most balanced portfolios have some stock, some short and long term bonds, maybe some real estate investments, and some cash. But the "Trump accounts" are only permitted to invest in stocks, which would drive cash into the stock market and prop up companies' equity ratios for sure, but also transfer all of the high risk onto individuals.

So here's what Scott Bessent said:

[W]e are going to push with these accounts that if you have the account, we want you to learn about it, we want you to understand it, it's almost like if you get a pet, you understand everything about your pet.

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