AARP Condemns U.S. Treasury Secretary’s Comments on Privatizing Social Security

U.S. Treasury Secretary Scott Bessent said Wednesday that the “Trump accounts” created for children in the recently passed federal tax and budget bill are a “back door for privatizing Social Security.” AARP condemned the secretary’s comment that same day and reinforced its strong opposition against any efforts to privatize Social Security.

“President Trump has said that Social Security should be protected and strengthened, and his administration needs to be clear: Any form of Social Security privatization is unacceptable,” John Hishta, AARP’s senior vice president of campaigns, said in a statement issued on July 30.

“[AARP has] fought any and all efforts to privatize Social Security, and we will continue to,” Hishta added.

The accounts Bessent referenced are government-sponsored investment accounts established under the One Big Beautiful Bill Act. They are designed to provide American children with a tool to build wealth from birth, which they can later spend on higher education, a business or a home. Babies born in the years 2025 through 2028 are eligible for a $1,000 contribution from the federal government to their account. Employers, family members, cities and states, and others can contribute up to certain amounts.

Discussing these accounts at a panel event in Washington, Bessent suggested they could be used more broadly to help Americans better save and understand investing. He then said, “In a way, it’s a back door for privatizing Social Security.”

“Social Security is a defined benefit plan paid out,” Bessent said. “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.”

Currently, a Social Security recipient — of which there are 69 million — gets a fixed amount of money each month — guaranteed — from the federal government based on their lifetime earnings and the age at which they start claiming the benefit. Privatized accounts, on the other hand, would not guarantee a payment amount and would instead be based on the whims of the market, erasing Social Security as a promise that retirees can count on.

AARP has long opposed efforts to privatize Social Security, including President George W. Bush’s proposal in 2004, arguing that doing so would put a reliable, guaranteed and essential part of Americans’ retirement incomes at risk. Hishta echoed this stance in AARP’s recent statement, saying that “Social Security is the bedrock of American retirement, lifting tens of millions of seniors out of poverty and providing an inflation-proof retirement for all.”

Hishta also called on President Trump to stick to his recent promises that Social Security “won’t be touched” and that he is “not going to touch Social Security.”