KELLY O'GRADY:
00:00:00
This week, President Trump celebrated what he is calling one of the most transformative policies of all time. On Wednesday, he hosted a summit to raise awareness of a new federally funded investment program aimed at giving American kids a longterm financial foundation. They're called Trump Accounts. So we sat down with Treasury Secretary Scott Bessent to discuss this initiative and the looming changes at the Federal Reserve. President Trump touted his new Trump Accounts, designed to grow a nest egg for young Americans. We're going to give every newborn American child a financial stake in the future.
KELLY O'GRADY:
00:00:34
Any US citizen with a child under 18 can opt into a Trump account when filing taxes. We sat down with Treasury Secretary Scott Bessent to chat about the initiative. What, for families viewing, is your one-sentence pitch on the Trump Accounts? Well, for the families who have children between January 1, 2025 and December 31, 2028, you've got $1,000 coming from the government that's going to be invested into an index fund.
KELLY O'GRADY:
00:01:03
Parents, employers, and nonprofits can make contributions in any Trump Account, up to $5,000 annually. If the government's initial $1,000 deposit is left alone, it could grow to $5,800 in 18 years, but by contributing the maximum, over $300,000. If I'm a low-income family, my child, when they turn 18, may only have $5,000 or so, give or take. So how are you going to prevent the wealth gap from widening with this program? Well, I think that that is a terrible criticism. It shows how out of touch anyone who says that is. Because if they say, only $5,000, these are families-- a huge number of families in America wouldn't have $500 to meet a medical emergency. So how can they say only $5,000? If they aren't able to go out and pay for college to go buy a home eventually, if it hasn't really meaningfully changed their ability to do that, would you call this a failure? Or is there a different way that the Treasury measures success in this particular program? Well, as I said, so many Americans couldn't even meet a $500 emergency. So maybe people just put it away and it's their rainy day fund. It can be a component. I worked three jobs to put myself through college. So maybe I would just be working two if that happened. What are some of the safeguards in this program that will help educate folks so that when someone does turn 18, they are able to utilize this in the right way and benefit? Sure, great question. I've been a big proponent of financial literacy over the years. We are pressing the states. We think states should be in charge of education. But I believe that by virtue of the accounts existing, we're going to have a great real-time laboratory that people are going to want to get up to speed. Because you're going to be able to look at it on your phone.
KELLY O'GRADY:
00:03:00
We also discussed Federal Reserve Chairman Jerome Powell. The Department of Justice launched a probe into Chair Powell in connection to renovations at the central bank. Powell has called the investigation politically motivated. Secretary Bessent says no one is beyond reproach, even the Federal Reserve. The Department of Justice is investigating Fed Chair Powell. What message does that send to future Fed chairs, as the president is about to announce who will succeed Powell? I think that the message is that independence does not mean no accountability. I've been calling for the Fed to do an internal investigation on numerous things since last spring. And they've chosen not to do it. Would it be crazy for someone to worry that there would be more accountability, more oversight, if interest rates don't go the way that the president, this president-- or, by the way, any future president-- wants? Not at all. Because again, the president's well aware that it's a committee. And the committee has 12 voters. The other thing is, a number of companies, like Bank of America, they're going to match employee contributions. And Visa's allowing you to roll over some of the rewards. And on the Fed piece, by the way, we're going to have much more in the next half hour when we talk to Jill Schlesinger. Grandmothers nationwide are rejoicing because they have more ammo to pressure their kids to have kids during this administration. Right, they get the $1,000. All right. You can watch our extended interview with Secretary Bessent on cbsnews.com and our CBS Mornings YouTube page. You're watching CBS Saturday Morning.
