Latest news with #TrumpAccount
The Guardian
29-05-2025
- Business
- The Guardian
Is Trump's ‘baby bond' really pro-child? No – children need a fair society to thrive
Turning children into capitalists – that's the purpose behind the new 'Trump account', which will give every new baby born in the US during the president's second term $1,000 to be invested in the stock market. Now, little shareholders can identify with the US companies they invest in. 'Hey … I own 50 bucks of McDonald's' was an example given by senator Ted Cruz. This is a surprise element in Donald Trump's 'big beautiful bill', which gives $1.1tn in tax cuts to the very rich funded by cutting Medicaid, food assistance and the education department. This joins a range of policies from rightwing parties around the world which look, on the face of it, to be pro-child or pro-family. In Hungary, Viktor Orbán announced an income tax exemption for mothers of two or three children – previously, only mothers of four or more children were exempt. Meanwhile, Nigel Farage in the UK has proclaimed that Reform would end the two-child benefit cap. Yet in reality, the policies are anything but. Trump's baby bond is not a pro-family poverty alleviation scheme, but his way of creating the 'shareholding democracy' Margaret Thatcher dreamed of when she promised in her 1985 conference speech to make 'owning shares as common as having a car'. Her government sold off nationalised companies cheap to encourage the capitalist impulse in British citizens: that's when we lost gas ('If you see Sid, tell him'), water and electricity alongside British Airways and others. It didn't work, as most sold these underpriced shares for a quick profit: by 2022, only 14% of British people directly held any shares. Britain had a child trust fund (CTF) for every baby until it was brutally axed by the coalition government. (Abolition was in the Liberal Democrats' 2010 manifesto: they weren't always nice.) Labour had introduced it in 2005: £250 for all, or £500 in low-income families, with a top-up of £250 at seven, and double that for poorer seven-year-olds. Parents who were able to could contribute extra. But Labour's intention was radically different from Trump's. The idea was to make a small dent in the colossal injustice of the inheritocracy so that every child at 18 would have something to see them on their way. The average £2,000 pot is only a wren-sized nest egg, but for those with no bank of mum and dad at least it can contribute towards driving lessons, renting a flat or education costs. When 8.4 million people have no savings at all, those from families with nothing risk being forced into bad jobs with no escape, for lack of the choices a little money can buy. Right now, restoring it is nowhere on the agenda; in these far harder times, the government must strive first towards its manifesto promise to cut child poverty. Gavin Kelly, the begetter of the CTF inside Gordon Brown's Treasury, laments that there is no research on its effects: this real-life experiment should be comparing those receiving the CTF with previous or later generations without it. The impulse for research dried up once the policy itself was killed off, but in one study done before the CTF came in, Abigail McKnight of the London School of Economics's Centre for Analysis of Social Exclusion found that 'early asset holding does have positive effects on later wages, employment prospects, excellent general health and in reducing malaise'. She says it allows young people to take risks, 'and risk-taking is very important for higher returns in later life'. Kelly has plentiful anecdotes. He just met a family in rural Suffolk with no savings whose son used his CTF to buy an old car he could never have afforded without it so he can travel to an apprenticeship 45 minutes away. Roughly 55,000 18-year-olds every month come into their fund, but it ends in 2029, when today's 14-year-olds will be the last recipients (18- to 22-year-olds, there are lost child trust funds waiting to be claimed). Back in 2005, Labour already had child poverty falling steeply, and this was a small attempt to ease the gap between the richest and the poorest. But it was far more than that. Here was another symbol of Labour's pro-child spirit – welcoming every baby and enhancing their lives with Sure Start centres. Labour was never consciously pronatalist, but its 'every child matters' policy strove to set children on their feet, with child tax credits among its pro-child impulses. Labour inherited a falling birthrate in 1997, but it rose until 2010, and then fell from two births a woman to 1.5 in the Tory years. Correlation is not causation, but unwelcoming years of cutting child and youth services can't have helped, with rising housing and childcare costs acting as barriers to child-bearing, and young people worse off than their parents were at baby-producing age. Children's pleasures were stripped bare, as school arts and sports were lost, and further education colleges, leisure centres, parks and every support to childhood were depleted, alongside savage benefit cuts. Even the infant mortality rate rose for first time in generations. So did the child death rate, up 8% in England in 2023, a third of it avoidable, according to the Royal College of Paediatrics and Child Health. This was all under the rightwing governments that savoured the two-child benefit cap, a (failed) eugenic attempt to prevent the wrong kind of children increasing the population. The sadness is that most women in the UK and other Organisation for Economic Co-operation and Development (OECD) countries wish they had more children than they do. In 2016, they wished on average for 2.3 – well above the population replacement rate of 2.1, let alone the current rate of 1.57. Rightwing leaders such as Trump and Viktor Orbán wish to own the pronatalist argument – don't let them. As the Social Market Foundation (SMF) reports in Baby bust and baby boom: Examining the liberal case for pronatalism, a country that celebrates childhood is often a better place for everyone. Just as abortion is a right, so is the right to bear children. That's why abolishing the two-child benefit limit – as ministers have hinted they are considering – is about even more than alleviating child poverty. Scrapping it would signify the renewal of a hopeful attitude to children that was always in Labour's DNA. Any vision of the future has to embrace a younger population: old people are not a nation's dynamism or innovation. Falling fertility means long-term stagnation. Punishing the children we have only leads to long-term social and economic damage. For the children who receive one, the 'Trump account' may do some good. But whatever his motive, the president's version of pronatalism is doomed. Experience from around the world suggests bribery has a minimal effect: France and Sweden both have higher birthrates than Hungary, regardless of the tax breaks. So Trump's offer of $5,000 to mothers for every birth may be doomed without a social environment that nurtures all children. Nor is his bill really likely to turn babies into mini-capitalists. Polly Toynbee is a Guardian columnist
Time of India
22-05-2025
- Business
- Time of India
What is "Trump Account" for babies, the new 'big, beautiful tax bill' that could get $1000 to newborns
Credit: Instagram/@realdonaldtrump When Donald Trump is involved, subtlety usually leaves the room. So it's no surprise that Republicans have unveiled a new policy that practically has his name written in fireworks. It's loud, bold, and unmistakably Trump — right down to the branding. House Republicans have just unveiled a proposal to give every American baby born between January 1, 2025, and January 1, 2029, a $1,000 head start in life — deposited into a special investment account. What was once subtly called a 'MAGA account' has now been rebranded with zero nuance as the 'Trump Account.' This renaming came through a last-minute amendment to the party's sweeping fiscal package, which they've nicknamed the 'One, Big Beautiful Bill.' And just in case anyone missed the point, the change makes it unmistakably clear: this baby bonus is brought to you by brand Trump. So, what exactly are Trump Accounts? The original idea was to launch 'money accounts for growth and advancement' — MAGA for short, in a not-so-subtle nod to Trump's famous campaign slogan. But apparently, even that wasn't Trumpy enough. So Republicans took it a step further, ditching the acronym in favor of straight-up name recognition. According to the bill, the Trump Accounts would 'seed' $1,000 into an investment account for every eligible American newborn starting in 2026. Parents can add up to $5,000 each year into these accounts. If they don't set one up, the government will do it for them. The catch? The money must be invested in a broad stock index and can only be used for specific purposes like higher education, starting a business, or purchasing a home. Any withdrawals for other reasons would be taxed as ordinary income, not at the lower capital gains rate — a point of concern for some financial professionals. 'It's not very attractive,' said financial adviser Ann Reilley. 'It just seems like they're complicating things for no reason. ' Still, among the long list of symbolic tributes Republicans have floated — from putting Trump's face on the $100 bill, to renaming Dulles Airport, to letting him negotiate the purchase of Greenland (to be rebranded 'Red, White and Blueland') — the Trump Account seems to be the most viable one yet. It's part investment plan, part political branding exercise. Classic Trump: a baby gift with a bold signature. One step to a healthier you—join Times Health+ Yoga and feel the change
Yahoo
22-05-2025
- Business
- Yahoo
'Gross': House Republicans Ripped Over 'Incredibly Creepy' New Way To Honor Trump
Critics are giving a thumbs-down to a Republican plan to honor President Donald Trump by naming a program for babies after him. The program that would give each newborn a special savings account pre-loaded with $1,000 was initially called 'money account for growth and advancement,' aka MAGA, Trump's longtime slogan. But this week, Republicans changed it to the 'Trump Account' as they tried to push their 'big beautiful bill' through the House. Critics agreed that money for babies is a good idea. In fact, Democrats have proposed a very similar plan before. But they don't love the name ― and spoke out on social media:
New York Times
22-05-2025
- Business
- New York Times
Bill Would Give Newborns $1,000 in ‘Trump Accounts'
When Republicans first rolled out a proposal last week to invest $1,000 on behalf of every American baby born over the next four years, they were not exactly subtle about whom the public should credit for the cash. The original draft called for the funds to be put into new a 'money account for growth and advancement,' or, as the bill suggested they be called, a 'MAGA account.' Apparently, though, endowing the accounts with the name of President Trump's political movement was not clear enough. As part of a series of last-minute changes House Republicans made to their broad fiscal package Wednesday night, they decided to just cut to the chase. The money would now be deposited in a 'Trump account.' Under the bill, children born between Jan., 1, 2025, and Jan. 1, 2029, would receive the money, which would be invested on their behalf in financial markets. Once they had grown up, they could withdraw the proceeds to pay for certain expenses, including going to college or buying a house. The child's parents, or other third parties, could also contribute to the account. While the benefit of the $1,000 initial investment from the government is clear, the accounts have otherwise puzzled tax experts. People could only contribute post-tax income to the accounts, and gains in the accounts would also be taxed when money was withdrawn. That would appear to make the 'Trump account' function much like a typical investment account, rather than a tax-advantaged account like an individual retirement account or a health savings account.
