Ted Cruz says Trump Accounts are 'Social Security personal accounts' that could reshape retirement

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Sen. Ted Cruz, R-Texas, said that the newly created Trump accounts for newborns and young Americans could pave the way for reforms to Social Security in the future.

Cruz spoke at an event during the Milken Institute Global Conference and said that the Trump accounts, which were created under the One Big Beautiful Bill Act last year and officially open this summer, will set an example that could build support for similar accounts geared towards retirement like Social Security.

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

Cruz said that Trump accounts will end up accumulating enough money in the years ahead that parents will want to have an account of their own and may be willing to support a change that would have their payroll taxes go into one in the next five to 10 years.

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Sen. Ted Cruz, R-Texas, said that Trump accounts could be a case study that enables Social Security reforms in the future. (Chip Somodevilla/Getty Images)

“We’re going to be able to go to parents and say, ‘Hey, you know that Trump account your kid has? Wouldn’t you like to be able to keep a portion of your tax payments, that you’re paying already, and instead of sending it to Uncle Sam, wouldn’t you like to have a Trump account just like your kid does?’” Cruz said.

The senator noted that efforts to reform Social Security have long encountered resistance and added, “Conservatives in America, for 50 years… have been trying to do Social Security personal accounts.”

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President Donald Trump signed the One Big Beautiful Bill Act into law last year which created Trump accounts. (Win McNamee/Getty Images)

The most significant Social Security reform proposal came during the second term of former President George W. Bush, whose plan would’ve reformed Social Security by allowing Americans to invest some of their taxable earnings and payroll taxes in low-cost stock market index funds on a voluntary basis into a retirement account.

He said that Bush “tried this fight, and sadly, Congress ran for the hills in a display of extraordinary cowardice.”

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Social Security is trending toward insolvency in less than a decade. (Mark Felix/The Washington Post)

“How did we get it done this time? Because we gave the money to babies, and so the old people didn’t get pissed. But you know what? Babies grow up,” Cruz said.

Social Security is trending toward insolvency, with its main trust fund projected to be depleted in 2032 as spending on the growing ranks of retired beneficiaries rises faster than the pace of growth in payroll tax revenues.

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That would trigger automatic benefit cuts for beneficiaries, as Social Security would be limited by law to only pay out the proceeds of payroll taxes once the trust fund is tapped out. The nonpartisan Congressional Budget Office (CBO) estimated that benefits would be cut up to 28% annually if Congress doesn’t act.