A recent op-ed argues that President Donald Trump’s proposal to expand access to 401(k)-style retirement plans could become a meaningful step toward a universal savings system — but only if it goes further than currently outlined.
Karl Polzer, founder of the Center on Capital and Social Equity, wrote that roughly half of American workers lack access to an employer-sponsored retirement plan with matching contributions.
He pointed to Trump’s remarks during the State of the Union address as an acknowledgment of that gap.
“Half of all of working Americans still do not have access to a retirement plan with matching contributions from an employer,” Trump said. “To remedy this gross disparity, I’m announcing that next year my administration will give these oft-forgotten American workers, great people, the people that built our country, access to the same type of retirement plan offered to every federal worker.
“We will match your contribution with up to $1,000 each year, as we ensure that all Americans can profit from a rising stock market.”
Polzer contended that while expanded access is important, it’s insufficient on its own.
In his view, millions of low-income workers have little or no disposable income after covering basic expenses. Without direct contributions or meaningful credits, he argued, a matching program will leave many behind.
Meeting core tests
In the op-ed published by The Hill, Polzer outlined two requirements he believes any successful reform must meet — providing funds to save and ensuring accounts are overseen by fiduciaries obligated to act in workers’ best interests.
He cited reports that the administration may rely on a “saver’s credit” created under the Secure 2.0 Act to reach workers with little or no tax liability.
Polzer called the credit a promising start and suggested it could be modified to deposit several hundred dollars annually into accounts for lower-income earners.
He also referenced the recent creation by Congress of so-called “Trump Accounts,” which seed $1,000 for certain newborns, as evidence that lawmakers can structure direct government contributions when they choose.
Critique of current tax benefits
Polzer sharply criticized the existing retirement savings framework, arguing it disproportionately benefits higher-income Americans.
Tax deferrals and Roth account advantages — heavily subsidized by the federal government — largely accrue to higher earners, he wrote, while many low-wage workers see little or no benefit.
Citing analysis from the Society of Actuaries, Polzer described the distribution of tax subsidies as “grossly unfair” and says it contributes to widening wealth inequality.
National savings framework
As an alternative, Polzer reiterated his organization’s 2018 proposal for a national retirement savings system.
Under that plan, every individual issued a Social Security number would receive an account managed by an independent board with fiduciary responsibility. The system would complement Social Security and employer-sponsored plans, not replace them.
Government contributions would be progressive — larger for lower-wage workers — and accounts would offer limited investment options similar to those available to federal employees.
Limited emergency borrowing would be allowed, but most funds would remain protected until retirement.
Polzer concluded that Trump’s proposal could help move the nation toward what he calls a more inclusive form of capitalism — but only if policymakers address the structural barriers that prevent low-income workers from building meaningful savings.