Sen. Bill Cassidy, R-La., told ThinkAdvisor Thursday that the next step for his plan to create a $1.5 trillion investment fund for Social Security is holding a congressional hearing.
Cassidy told The Hill newspaper that he and Sen. Tim Kaine, D-Va., are working to gather support for investing $1.5 trillion over the next five years into an investment fund that would then be given 70 years to grow.
“I have a plan that will protect promised benefits, save the program, and can pass Congress," Cassidy told ThinkAdvisor in an emailed comment. "It is based on an approach that already works in the private and U.S. government sectors. That’s how we know this can work with no risk to the beneficiary.”
Cassidy said Thursday the next step is to hold a congressional hearing on the plan, but he didn't specify a date.
Cassidy and other lawmakers first floated the idea of a "sovereign wealth fund" for Social Security in 2023.
Cassidy and Sen. Angus King, I-Maine, along with a dozen other senators said then that they were working on Social Security legislation that includes the creation of such a fund to help extend Social Security's solvency.
In 2023, the Cassidy-King plan attempted "to address the projected shortfall in the Social Security trust fund by borrowing $1.5 trillion to invest on Wall Street ... in hopes it would yield sufficient returns to pay back the loans and still have enough money left over to cover any future gap in Social Security funding," explained Max Richtman, president and CEO of National Committee to Preserve Social Security and Medicare.
Cassidy told The Hill newspaper last month that the government would create an investment fund separate from the existing Social Security trust funds, into which the government would place $300 billion annually over the next five years.
That money would be invested into stocks, bonds and other investments, and Cassidy told The Hill it would be held “in escrow for 70 years.”
“Any dividends being paid, for example, flow back into the investment fund. As that occurs, we also repeal the law requiring that benefits be cut to match [trust fund] income,” Cassidy told The Hill.
The Treasury Department would be responsible for making up the payments for those 75 years, at which point the fund would pay back the Treasury Department and use its remaining funds to supplement Social Security payments, according to the senators, The Hill reported.
Cassidy argued the plan would not add to the national debt.
A nonpartisan analysis by the Social Security chief actuary, released Tuesday, found that the depletion date for the Social Security Old Age and Survivors Insurance (OASI) Trust Fund — which pays retiree benefits — will come a year earlier, in 2032, due to the One Big Beautiful Bill Act, which was signed into law on July 4.
Sen. Bill Cassidy. Courtesy photo
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