Kevin Hassett, former chairman of the White House Council of Economic Advisers, has been nominated by President-elect Trump to lead the National Economic Council. Photo: Al Drago/Bloomberg
President-elect Donald Trump announced last week that economist Kevin Hassett will serve as the Director of the White House National Economic Council. Hassett, who will return to the White House after serving during the first two years of the Trump Administration, co-wrote the Economic Innovation Group’s white paper, Inclusive Wealth-Building Initiative, which was the basis for the Retirement Savings for Americans Act of 2023 (RSAA), legislation that would give private sector workers access to portable, tax-advantaged retirement plan that the bill’s sponsors claimed would “help low- and middle-income Americans build wealth and save for retirement.”
“As my Chair of the Council of Economic Advisers, Kevin played a crucial role in helping to design and pass the Tax Cuts and Jobs Act of 2017, and stood with me as we pursued our enormously successful agenda to Make America Great Again,” Trump wrote in a statement.
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"He will play an important role in helping American families recover from the inflation ... Kevin will also play a key role strengthening our economic relationships with allies, new and old, while also securing prosperity for the American people.”
Hassett helped design the Tax Cuts and Jobs Act of 2017 and, more recently, advised the president-elect on economic policy during the campaign. His white paper and the RSAA bill are supported by the Economic Innovation Group, a billionaire-backed think tank advocating for radical reform of the retirement system.
However, Morningstar Center for Retirement, one of the RSAA’s opponents, say the bill would likely lead to worse retirement outcomes for most Gen Z and millennial workers.
“The RSAA would automatically enroll workers without access to an employer-sponsored retirement plan into the federal program,” according to Morningstar’s report. “However, for workers with 10 or more years of future participation in a DC plan, the RSAA would result in significantly worse outcomes, particularly for those with 20-plus years of future participation.”
RSAA, which would create a retirement plan for private sector employees similar to the federal Thrift Savings Plan for public sector workers, “would likely change investor savings behavior and plan sponsor behavior," said Spencer Look, associate director of retirement studies at the Morningstar Center for Retirement & Policy Studies.
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"For example, employers would be less likely to offer a plan because the proposal's federal match tax credit would effectively subsidize some portion of the employer's contributions. This impacts retirement-income adequacy because savings rates in defined contribution plans are a lot higher than the bill's 3% default rate. This is also true for lower-income workers.”
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Lynn Cavanaugh
Lynn Varacalli Cavanaugh is Senior Editor, Retirement at BenefitsPRO. Prior, she was editor-in-chief of the What's New in Benefits & Compensation newsletter. She has worked for major firms in the employee benefits space, Vanguard and Willis Towers Watson, as well as top media companies, including Condé Nast and American Media.
