Let’s teach kids to be investors from birth, and help them find the schools they need to succeed.
By Ted Cruz
Last month, as Republican senators gathered in the Library of Congress in Washington, D.C. to have an extended discussion and strategy session about the Budget Reconciliation process that has been dominating conversations and newscasts, I asked my colleagues two specific questions: In all of this massive bill, what will be its biggest legacy? What bold, transformational policies can we champion that will impact the next generation of Americans — policies we’ll still be talking about 10, 20, even 30 years from now?
With Republicans in control of the White House, the Senate and the House, it’s clear that this year’s bill is our best opportunity to rally behind a strong conservative agenda that puts families first.That’s why I’m pushing my colleagues to include two major proposals in this year’s budget reconciliation package that I believe do exactly that.
By giving our children the opportunity to invest in our capitalist system, and choose the educational path that best fits their needs, we can equip them with the two strongest tools for success.
First, I’ve introduced legislation – called the "Invest America Act" – that would create a private investment account for every newborn child in America and seed it with the first $1,000. Each year, family, friends or employers would be able to contribute up to $5,000 to this tax-advantaged account. Those accounts would be invested in exchange-traded funds or mutual funds based on the S&P 500.
The accounts would do two things. First, children across America would experience the miracle of compounded growth. A child born this year who has the initial $1,000, plus $5,000 invested annually, would — at a historical average growth rate of 7% — have about $170,000 invested by age 18. By 35, the account would be worth $700,000.
That powerful wealth accumulation would be utterly transformational for our next generation of children. Every child would also now be a shareholder in America’s major businesses.
All of us have seen the sad statistics about how many young people distrust capitalism or support socialism. This policy would create a whole generation of capitalists.
When a teenager opens her app and sees her investment account, she would see that she owns, say, $50 in Apple, $75 in Boeing and $35 in McDonald’s.
Those wouldn’t simply be big, scary corporations — she’d be one of their owners.
Moreover, a large coalition of business leaders — led by tech entrepreneur Brad Gerstner and Dell CEO Michael Dell — have committed to contribute or match contributions for their employees’ children. Much like 401(k) accounts transformed how Americans save for retirement, with most large companies now matching or otherwise contributing to those accounts, we would probably see the same for Invest America accounts for children.
These are 401(k)s for kids. And philanthropists like Dell have also stated that they intend to give millions to help low-income kids grow their accounts.
Those wouldn’t simply be big, scary corporations — she’d be one of their owners.
Moreover, a large coalition of business leaders — led by tech entrepreneur Brad Gerstner and Dell CEO Michael Dell — have committed to contribute or match contributions for their employees’ children. Much like 401(k) accounts transformed how Americans save for retirement, with most large companies now matching or otherwise contributing to those accounts, we would probably see the same for Invest America accounts for children.
These are 401(k)s for kids. And philanthropists like Dell have also stated that they intend to give millions to help low-income kids grow their accounts.If enacted, this policy would ensure that every American has skin in the game — it is a generational investment in America’s youth, and I believe it will fundamentally rebuild their faith in American capitalism.
Equally important for success is ensuring that every American child has the right to choose their educational path.
That’s why the second policy we should include in the "One Big Beautiful Bill" is to get the federal government behind School Choice. We should give federal tax credits, dollar for dollar, for contributions to scholarship-granting organizations in the states and open up $10 billion annually in new scholarships that allow children and parents to be able to choose the K-12 school that best meets their needs.
School choice is the civil rights issue of the 21st century. Every child in America deserves access to a quality education, regardless of their Zip code, their race or their parents’ income. Parents should be empowered to decide what education is best for their child.
Republicans must build on the historic progress happening in states such as my home state of Texas, which just passed the most sweeping school choice victory in the country.
In his first term, President Donald Trump in his State of the Union address urged Congress to pass my legislation, the Universal School Choice Act. However, to do so we needed Democratic support in the Senate, and no Democrat was willing to stand up to the teachers unions. Now, under the reconciliation rules, we can finally pass the bill with our 53 Republican senators. And Democrats cannot block it.
Versions of both of these ideas are included in the just passed House of Representative's "One Big Beautiful Bill" Reconciliation Bill – but there will be a battle to keep them and to get them through the Senate.
We must act boldly and get them to the president’s desk.
Nothing else in the bill would leave as significant a legacy.
Sen. Ted Cruz, Republican of Texas, is Chairman on the U.S. Senate's Commerce, Science & Transportation Committee, and is also a member of the Foreign Relations Committee, the Judiciary Committee; and the Rules Committee.
