A draft of Congress' reconciliation bill includes a proposed retirement fund for kids.
The "money account for growth and advancement" or "MAGA account" is the brainchild of Sen. Ted Cruz, R-Texas.
Initially called "Invest America," the initiative was rebranded on its way to the House Ways and Means committee. Cruz spent months in discussions with House Speaker Mike Johnson, R-La., committee Chair Jason Smith, R-Mo., and the White House.
The proposal would create tax-advantaged investment accounts with $1,000 for every newborn baby with a Social Security number. That money then would accumulate interest and value through investments over time.
"You can call it anything you like. What is powerful is enabling every child in America to have an investment account and a stake in the American free enterprise system," Cruz told Semafor on Monday.
Cruz said President Donald Trump "weighed in directly to include this provision" in the reconciliation bill, and added the proposal's "legacy" provisions will please voters over the long term.
The MAGA accounts would allow families and employees to contribute up to $5,000 in the children's accounts annually, with the goal being a total in the tens of thousands of dollars to help pay for education, job training, starting a business, or buying a home.
Distributions from the accounts would be taxed at the capital gains rate.
"This is essentially a 401k for every newborn in America, and just like with 401ks, employers have seen it is a very attractive benefit for their employees to match or help seed those savings accounts," said Cruz, who has suggested the accounts for more than a year.
Cruz said the MAGA accounts will help every child invest in America.
"There are many Americans who don't own stocks or bonds, are not invested in the market, and may not feel particularly invested in the American free enterprise system. This will give everyone a stake," he added.
Republicans in Congress began the week racing to put the final touches on Trump's sprawling domestic policy mega-bill.
Lawmakers in the House are aiming to usher into law Trump's pledges to widen and extend his 2017 tax relief program, while boosting border security and defense and shrinking the government.
Agence France-Presse contributed to this report.
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Charlie McCarthy, a writer/editor at Newsmax, has nearly 40 years of experience covering news, sports, and politics.
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