Republican Sen. Ted Cruz said during a public conference this week that the so-called Trump Accounts established under the GOP’s 2025 budget law represent a viable path toward Social Security privatization—something the Texas lawmaker described as a “dirty little secret.”
During a panel discussion at the Milken Institute Global Conference in California, Cruz said that “conservatives in America, for 50 years... have been trying to do Social Security personal accounts.” Cruz, who lamented the failure of Bush-era efforts to privatize Social Security, described such personal accounts as vehicles into which the payroll taxes that finance current Social Security benefits could be diverted.
In the not-too-distant future, Cruz envisioned, “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?’'’
“My prediction is, within five years, that is going to have a really compelling constituency,” the Texas Republican added.
Linda Benesch, vice president of communications at the progressive advocacy group Social Security Works, told Common Dreams that Cruz’s comments laid bare the “two-pronged strategy to push Social Security privatization: Creating the Trump Accounts with one hand and gutting the Social Security Administration with the other.”
Benesch pointed to the remarks of an anonymous Social Security Administration (SSA) worker, who warned in comments to The New Yorker earlier this week that privatization advocates plan to point to the decimated agency and declare, “Look how Social Security sucks.”
“They’ve been trying to privatize it for decades,” said the SSA worker. “Now this will give them the excuse.”
Benesch said Friday that Cruz is “giving away the other half” of the Republican scheme by promoting the eventual expansion of Trump Accounts, investment vehicles under which children born between January 1, 2025 and December 31, 2028 are eligible for $1,000 in “seed money” from the federal government. Parents of eligible children can contribute up to $5,000 per year to the accounts.
Cruz’s comments are not the first time a Republican official has openly characterized Trump Accounts as a potential avenue for Social Security privatization.
“In a way, it is a backdoor for privatizing Social Security,” US Treasury Secretary Scott Bessent said last summer. “Social Security is a defined benefit plan paid out that—to the extent that if all of a sudden these accounts grow, and you have in the hundreds of thousands of dollars for your retirement—then that’s a game changer, too.”
Axios reported Friday that “the idea that Trump Accounts could replace or augment Social Security is something that has been talked about behind closed doors with lawmakers.”
“But no one has wanted to touch that third rail, at least publicly,” the outlet added, citing a person familiar with the private conversations.
Max Richtman, president and CEO of the National Committee to Preserve Social Security and Medicare, noted in a Friday statement that polling has found little support for privatizing Social Security, with a 2022 survey finding that just 15% of American voters back the idea.
“Turning over Americans’ hard-earned benefits to Wall Street would expose future retirees to unnecessary risk while lining the pockets of the financial elites who donate to Republicans,” said Richtman. “Ted Cruz, Donald Trump, and their Republican allies should realize that the people will not stand for privatization of their hard-earned benefits, and we in the advocacy community will continue to ensure that it never happens.”