Robinhood CEO Vlad Tenev calls Trump Accounts 'amazing', recaps CEO roundtable with the president
Vlad Tenev, Robinhood CEO, joins 'Closing Bell Overtime' to talk the newly announced 'Trump Accounts', investing trends on the platform, the recent Bitstamp deal, and more.
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Washington Post
4 hours ago
- Washington Post
Trump pushes $1,000 ‘Trump accounts' for babies
As Republicans' massive tax and spending cut bill makes its way through the Senate, President Donald Trump on Monday touted a provision in the measure that would provide every child born in the United States with a $1,000 investment account. Dubbed 'Trump accounts,' the tax-deferred investment accounts would be set up for children born in the U.S. after Dec. 31, 2024, and before Jan. 1, 2029 — covering the majority of Trump's second term. The accounts will, over the course of a child's first 18 years, track the overall stock market, and parents are allowed to contribute up to $5,000 a year to the account. The accounts will be controlled by the child's guardians or parents. Once an account holder turns 18, they can cash out and use the funds, which will be taxed as long-term capital gains, for limited purposes: they can pay for college or a job training program, open a small business or make a down payment on a first home. If the money is spent on anything else, it will be taxed as ordinary income. 'This is a pro-family initiative that will help millions of Americans harness the strength of our economy to lift up the next generation, and they'll really be getting a big jump on life, especially if we get a little bit lucky with some of the numbers in the economies into the future,' Trump said Monday. Trump promoted the program as a pro-family, pro-child initiative at the same time his administration and congressional Republicans face criticism from Democrats over cuts that the tax, spending and immigration bill would make to programs like Medicaid and the Supplemental Nutrition Assistance Program. Democrats argue the reductions would leave millions of American children and families without proper health care or nutritional benefits. Trump appeared at a White House roundtable that featured leading CEOs, including Dell Technologies founder Michael Dell, Goldman Sachs chief executive David Solomon and Uber CEO Dara Khosrowshahi. Dell said his company would match the government's $1,000 seed money in the accounts of their employees' new children. At the event, House Speaker Mike Johnson (R-Louisiana), who shepherded the tax and spending cuts bill through the House last month, said the program is a 'transformative policy that gives every eligible American child a financial head start from day one.' 'If you have a 401(k), you understand the power of investing early for the future,' Johnson said at the White House. Trump accounts were originally introduced under the 'MAGA Act' — short for 'Money Accounts for Growth and Advancement' — by Rep. Blake D. Moore (R-Utah) in May. The proposal adopted Trump's name before it was incorporated in the House Republican version of the bill, which the Senate is working on. While Trump and Johnson encouraged Senate Republicans on Monday to keep the program in the bill, it is unclear if the proposal will remain. Already, fiscally conservative Republicans in the Senate have complained that the bill doesn't do enough to cut spending, and they are looking to make substantial revisions in the House package. Republicans have not released any cost estimates for the program. But with about 3.6 million babies born in the U.S. each year, the cost could exceed $3 billion annually. The One Big Beautiful Bill — as Trump and Republicans have dubbed the tax and spending cut package — is expected to add more than $3 trillion to the national debt over the next decade, according to the Congressional Budget Office. The Trump program is similar to 'baby bond' programs run in California, Connecticut and Washington, D.C., which give some newborns investment accounts. However, while those local programs were created to reduce the wealth gap by supporting children in need or lower-income families, Trump accounts will be made available to Americans regardless of their socioeconomic status. To open a Trump account for their child, at least one of the parents will be required to have a Social Security number with work authorizations — leaving some U.S.-born children of immigrants out of the program. Economist Darrick Hamilton — who conceptualized the idea of baby bonds — told The Washington Post that Republicans' program will probably 'enhance inequality' by 'directing our public resources towards an already affluent class while at the same time, imposing … mean-spirited cuts to those who need the most.' 'It's a bad idea co-opting a good idea in both rhetoric and design,' Hamilton said. Other critics of the program said American children in poverty would be better off if congressional Republicans did not make major cuts to social safety net programs like Medicaid and the Supplemental Nutrition Assistance Program. The current tax and spending bill would make significant cuts to both programs. 'Feel like low-income families would prefer their assistance buying groceries not get cut, but that's just me,' said Center on Budget and Policy Priorities Senior Director Brendan Duke on X.
The Hill
4 hours ago
- The Hill
Trump hails $1K-per-child ‘Trump Accounts' during White House roundtable
(NEXSTAR) – On Monday, President Trump promoted the so-called 'Trump Accounts' during a roundtable meeting with lawmakers and business leaders, including the CEOs of Dell, Uber and Goldman Sachs, among others. Related video above: Trump and Musk feud continues over 'big, beautiful bill' 'This is a pro-family initiative that will help millions of Americans harness the strength of our economy to lift up the next generation,' Trump said at the meeting. 'They'll really be getting a big jump on life, especially if we get a little bit lucky with some of the numbers and the economy.' The proposal, part of Trump's 'big, beautiful bill,' would create tax-deferred investment accounts for infants that start with $1,000 per child. Once the child reaches age 18, they would be able to take out money to put toward a down payment for a home, education or to start a small business. If the money is used for other purposes, it'll be taxed at a higher rate. Dell CEO Michael Dell called the proposed accounts a 'simple yet powerful way to transform lives' Monday. Dell and the other assembled CEOs were expected to earmark billions of dollars to be invested in the Trump Accounts for their employees' children. 'Decades of research has shown that giving children a financial head start profoundly impacts their long-term success,' Dell said, according to the White House. 'With these accounts, children will be much more likely to graduate from college, to start a business, to buy a home, and achieve lifelong financial stability.' In order to qualify for one of the accounts, the child must have at least one parent with a Social Security number with work authorizations, meaning that some babies born in the U.S. to immigrant parents might not qualify. The money will be invested in an index fund where it will grow until the child reaches 18 and can withdraw funds to buy a home, pay for education or start a small business. Money spent on other things would be taxed at a higher rate. Families, guardians and private entities will be able to deposit up to $5,000 more per year. While the investment would be symbolically meaningful, it's a relatively small financial commitment to addressing child poverty in the wider $7 trillion federal budget. Assuming a 7% return, the $1,000 would grow to roughly $3,570 over 18 years. It builds on the concept of 'baby bonds,' which two states — California and Connecticut — and the District of Columbia have introduced as a way to reduce gaps between wealthy people and poor people. Economist Darrick Hamilton of The New School, who first pitched the idea of baby bonds a quarter-century ago, said the GOP proposal would exacerbate rather than reduce wealth gaps. When he dreamed up baby bonds, he envisioned a program that would be universal but would give children from poor families a larger endowment than their wealthier peers, in an attempt to level the playing field. The money would be handled by the government, not by private firms on Wall Street. 'It is upside down,' Hamilton said. 'It's going to enhance inequality.' Hamilton added that $1,000 — even with interest — would not be enough to make a significant difference for a child living in poverty. A Silicon Valley investor who created the blueprint for the proposal, Brad Gerstner, said in an interview with CNBC last year that the accounts could help address the wealth gap and the loss of faith in capitalism that represent an existential crisis for the U.S. 'The rise and fall of nations occurs when you have a wealth gap that grows, when you have people who lose faith in the system,' Gerstner said. 'We're not agentless. We can do something.' The Associated Press contributed to this report.
Business Insider
4 hours ago
- Business Insider
These CEOs plan to invest billions in 'Trump accounts,' government savings plans for newborns
The White House is ready to usher in a new generation of boss babies — and it's enlisting the help of some of America's most prominent executives. A small crowd of CEOs joined President Donald Trump at the White House for a roundtable on Monday to promote his plan to deposit $1,000 in investment accounts for newborn babies. The program is part of the president's signature — and controversial — spending bill, which has passed the House but faces headwinds in the Senate after getting publicly bashed by Elon Musk. The CEOs who attended the roundtable included Dell Technologies CEO Michael Dell, Uber CEO Dara Khosrowshahi, and Goldman Sachs CEO David Solomon. A White House official confirmed to Business Insider ahead of the event that under the program, the executives would announce plans to invest billions of dollars worth of collective investments into Trump Accounts for their employees' future children. With the exception of Dell, it was not immediately clear how much each company plans to invest if the initiative becomes law, and the companies did not specify when contacted by BI. Dell said in a statement provided to BI that the company would match the government's $1,000 investment for the children of its employees. "The creation of investment accounts for every child will compound into substantial nest eggs providing support for education, home ownership, and starting families," the CEO said. Other corporate leaders who attended the event on Monday afternoon included Robinhood CEO Vladimir Tenev, Salesforce cofounder Parker Harris, Altimeter Capital CEO Brad Gerstner, Arm Holdings CEO Rene Haas, and ServiceNow CEO William McDermott. "This is a pro-family initiative that will help millions of Americans harness the strength of our economy to lift up the next generation, and they'll really be getting a big jump on life," Trump said during his prepared remarks at the start of the roundtable. Trump Accounts would be available to every American citizen born from January 1, 2025, and December 31, 2028, according to the bill. Under the program, if the bill in its current form passes and is signed into law, the federal government would invest $1,000 into an index fund that tracks the stock market. The child's guardians will control the account. Guardians could deposit up to $5,000 a year into the account, which the child could access once they're 18. In a statement to BI, White House press secretary Karoline Leavitt said that passing the president's spending bill, called the "One Big Beautiful Bill," and the associated Trump Accounts, will put the lives of young Americans on the right financial path!" BI reached out to the companies of the CEOs who attended the roundtable. In their remarks at the event and statements provided to BI, the CEOs emphasized that the investment accounts would set the next generation up for success by giving them a financial head-start. "Our economy's future vitality is dependent on young people understanding the power of investing for the long term," Solomon, CEO of Goldman Sachs, said during the roundtable. "The American stock market is among the greatest wealth creation engines of our time," Tenev, the Robinhood CEO, said in a statement. "Speaking personally, as an immigrant to this country, I've seen firsthand the vast opportunities afforded by our financial system." A representative for ServiceNow said in a statement: "This is more than policy — it's about unlocking a future where more Americans can own, build, and thrive." Monday afternoon's investments are another example of the Trump administration's close ties to the private sector. The administration has also secured hundreds of millions of dollars in pro bono work from major law firms for causes the administration supports.
