Thursday, September 29, 2022

Does Trump Plan To Cut Social Security

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Did Trump’s Budget Include A $2 Trillion Cut For Medicare Medicaid And Social Security

Reality Check: Does President Trump Want To End Social Security?

During his presidential campaign, Donald Trump said he wouldnt try to cut Medicare or Medicaid.

But his federal budget proposal broke that promise, according to Rep. Hakeem Jeffries, a Democrat from New York City.

“He can’t talk about his own budget, where he threatened to cut $2 trillion from Social Security, Medicare and Medicaid,” Jeffries said about Trump during an interview on CNNs State of the Union.

Trumps budget director, Mick Mulvaney, released the presidents federal budget proposal in February. The plan was met with little fanfare because Congress had already passed a two-year spending deal a few days earlier, making the presidential blueprint largely irrelevant.

Like any other budget proposal, Trumps showed where he wanted to spend money and where he didnt. Did he want to cut Social Security, Medicare, and Medicaid by $2 trillion?

Wheres $2 trillion from?

Jeffries spokesperson did not get back to us with information supporting his claim.

In a literal sense, Trumps budget did propose about $2 trillion in savings from Social Security, Medicare and Medicaid over 10 years.

The majority of those savings about $1.4 trillion would come from Medicaid, according to projections from the U.S. Department of Health and Human Services.

About $530 billion in savings would come from Medicare and $25 billion would come from Social Security. Collectively, that totals almost $2 trillion.

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How Would Trump Approach Fixing Social Security If Reelected To A Second Term

Now for the big question: What happens to Social Security if Donald Trump is reelected as president?

While no one knows this answer with any certainty, we’ve been given a number of clues during his presidency to make logical guesses. Perhaps the biggest clue came in January 2020 at the World Economic Forum in Davos, Switzerland. In an interview on CNBC’s Squawk Box, host Joe Kernen asked Trump if “entitlements ever be on your plate?” to which the president replied, “At some point they will be.”

To be crystal clear, this doesn’t mean that Trump has decreed Social Security spending cuts are coming. However, it does raise eyebrows given the contrasting nature by which Democrats and Republicans have approached fixing Social Security’s imminent cash shortfall.

For instance, Democrats have predominantly been in favor of increasing revenue by raising or eliminating the earnings cap associated with the payroll tax. In 2020, all earned income between $0.01 and $137,700 is subjected to the payroll tax, with earnings beyond $137,700 exempted. Raising or eliminating this cap would require the well-to-do to pay more into the system.

Again, while Trump has not specifically said that spending cuts are going to happen, there is a good likelihood that outlay reductions would be how Trump would tackle Social Security’s imminent cash shortfall.

President Trump speaking to reporters on the White House lawn. Image source: Official White House Photo by Joyce N. Boghosian.

What Has Trump Done To Tackle Social Security’s Cash Shortfall During His First Three Years In Office

So, what has Donald Trump done to improve Social Security while in office? With the president clearly averse to tackling the issue directly and potentially losing votes, Trump has instead focused his efforts on indirect solutions, the most notable of which is the passage of the Tax Cuts and Jobs Act .

When signed into law in December 2017, the TCJA represented the most sweeping tax overhaul in the U.S. in over three decades. It lowered the tax liability of most working Americans, while capping the marginal corporate income-tax rate at 21%, down from a peak of 35%. In essence, it was a tax cut designed to stimulate economic growth by encouraging businesses to innovative, hire, and expand, as well as encourage consumer spending.

How does this help Social Security, you ask? The program has three sources of funding: a 12.4% payroll tax on earned income, the interest income earned on its asset reserves, and the taxation of benefits. The former, the payroll tax on earned income of up to $137,700 , is the program’s workhorse. In 2018, it was responsible for $885 billion of the $1 trillion in revenue collected. The thinking here is that if tax cuts can bolster economic growth, workers should see an increase in wages and/or income, leading to more payroll tax being collected. This increase in payroll tax collected should put Social Security on better financial footing.

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Release: Trump Plan To Permanently Cut Social Security Taxes Would Drain The Programs Trust Fund By 2025

Washington, D.C. A new analysis from the Center for American Progress shows just how quickly Social Securitys trust fund would be exhausted and benefits cut if President Donald Trump permanently cuts payroll taxes, as he said he wanted to do in recent days.

In Trumps Plan To Defund Social Security, Seth Hanlon and Christian E. Weller find that cutting payroll taxes for the last four months of the year would delay about $100 billion in tax revenue from going to the Social Security trust fund. However, if the president were to eliminate the employee payroll tax not only for this fall but permanently, as he vowed to do in a second term, the trust fund would run dry by either 2025 or 2026. This threatens a dramatic loss of income for tens of millions of retirees, disabled people, and surviving spouses and children of workers.

Trumps latest comments on Social Security come on the heels of his that Social Security and Medicare cuts would be on the table in his second term. Trump famously pledged not to touch Social Security but then his administration proposed cuts to the program in each of its budgets.

Based on the latest Social Security trustees projections, Hanlon and Weller estimate:

Fact Check: Trump Payroll Tax Cut Is Social Security Risk

Will Trump Cut Social Security And Medicaid? Bernie ...

Baltimore President Donald Trumps proposed payroll tax cut is a threat to Social Security no matter how he casts it.

During a news conference Wednesday, he insisted he could eliminate the tax if he were reelected, and do it without undercutting retirement benefits or greatly adding to the deficit. He said economic growth would offset the revenue losses.

That claim has little basis in reality.

He also pointed to a manufacturing boom during the coronavirus pandemic but there isnt one.

A look at some of his economic claims:

TRUMP: At the end of the year, the assumption that I win, Im going to terminate the payroll tax Well be paying into Social Security through the General Fund.

THE FACTS: Trump, in effect, has endorsed defunding Social Security by not providing an alternative source of revenues.

The risk is that this could destabilize an anti-poverty program that provides payments to roughly 65 million Americans. It also could force people to cut back on the spending that drives growth so they can save for their own retirement and health care needs if they believe the government backstop is in jeopardy.

A 12.4% payroll tax split between employers and workers funds Social Security, while a 2.9% payroll tax finances Medicare. These taxes raised $1.24 trillion last year, according to the Congressional Budget Office. Over a 10-year period, Trumps idea would blow a $16.1 trillion hole in a U.S. budget that is already laden with rising debt loads.

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Larson: If Trump Has His Way Social Security Would Be Eliminated By 2023

Hartford, CT Today, House Ways and Means Social Security Subcommittee Chairman John B. Larson released the following statement after Social Security Administration Chief Actuary Stephen Goss released an analysis, requested by Senate Democrats, based on the impact of eliminating the payroll tax completely. This is something President Trump has proposed twice. The analysis found that the Social Security Disability Insurance Trust Fund would be permanently depleted by mid-2021 and the Social Security Old Age and Survivors Insurance Trust Fund would be permanently depleted by mid-2023.

Donald Trump has stated twice now his intent to terminate the payroll tax, effectively defunding Social Security. This week, the Social Security Chief Actuary released an analysis that should sound the alarm and give every American pause. If the payroll tax is terminated like the President has said he wants to do, Social Security Disability benefits would dry up in 2021, leaving people with disabilities in the lurch. Social Security retirement and survivors benefits would be gone in just three years, by mid-2023. By doing this, he would achieve an age-old goal of the far-right to eliminate Social Security.

This should be a wakeup call for all Americans. Every American needs to read this report! If we dont stop President Trumps plan, Social Security will be gone in just three years.

Trump Deferred The Tax That Funds Social Security And Vowed To ‘terminate’ The Tax In The Future

The vast majority of Social Security is financed through the payroll tax, according to the Social Security Administration. In 2019, 89% of Old-Age and Survivors Insurance and Disability Insurance was financed via payroll taxes equal to $944.5 billion.

One of the Aug. 8 executive orders instructed the Treasury Department to allow employers to defer payment of payroll taxes for employees who make less than $100,000 each year.

The deferrals, which may start Sept. 1 and extend through 2020, are intended to allow Americans to use the totality of their income amid the pandemic’s hardships.

The order also instructed Treasury Secretary Steven Mnuchin to “explore avenues, including legislation, to eliminate the obligation to pay the taxes deferred” a goal Trump reiterated in remarks after he signed the order.

If Im victorious on November 3rd, I plan to forgive these taxes and make permanent cuts to the payroll tax,” Trump said, per the Washington Post. Im going to make them all permanent.

“In other words, I’ll extend it beyond the end of the year, and terminate the tax,” he added. He reiterated his plan at a press conference on Monday.

“We will be ending that tax. We will be terminating that tax,” Trump said, per a transcript from CNN. “The payroll tax is a big deal for people. It’s a tremendous saving for people. And we’re going to be doing it, and we intend to terminate it at the end of the appropriate period of time.”

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Heres How Old School Investing May Just Protect Your Retirement

After all, FICA taxes amount to 6.2% each for employers and employees for Social Security, and 1.45% each for Medicare.

As far as Social Security is concerned, thats 97% of the amount needed to cover benefits in 2035, the year of trust fund depletion as calculated before the pandemic, FICA taxes are forecasted to be sufficient to cover 80% of benefits, according to hte most recent Trustees Report. Expressed another way, pre-pandemic, the federal government spent one trillion dollars on Social Security benefits in 2019, which amounted to 4.9% of GDP or 23% of the total federal budget. Is it sensible, is it reasonable to add another $1 trillion to the deficit each year? What about $1.5 trillion, the forecasted cost in 2030?

It seems insane to even contemplate it, Trumps claim that its feasible because well have tremendous growth notwithstanding. Yesterday, the CBO updated its projection of the ultimate budget deficit for 2020: $3.3 trillion. Yet the latest Pew poll shows a drop in the proportion of Americans who are concerned about the budget deficit: from 55% in 2018 to only 47% in 2020. And Americans clamored for second stimulus checks over the spring and summer , and the vice presidential nominee Kamala Harris sponsored legislation for up to $10,000 per family per month in stimulus cash benefits.

And these are not their only sources of retirement income.

As always, youre invited to comment at !

Senators Urge Trump Administration To End ‘cruel And Dangerous’ Effort To Cut Social Security Disability Benefits

Trump Promised to Not Cut Medicare, Medicaid and Social Security

Ahead of a public comment period ending Friday, dozens of U.S. senators came together Tuesday in a letter opposing a Trump administration proposal that could cut off hundreds of thousands of people from an estimated $2.6 billion in Social Security disability benefits over a decade.

“This proposed rule appears to simply be another transparent attempt from the Trump administration to make it more difficult for Americans to access essential supports and benefits.”41 senators

Alex Lawson, executive director of the progressive advocacy group Social Security Works, toldCommon Dreams last month that the proposed rule change “is the Trump administration’s most brazen attack on Social Security yet.”

The rule, in the Federal Register by the Social Security Administration in November 2019, would force people to more frequently complete continuing disability reviews to keep their benefits.

The senators wrote in their letter to SSA Commissioner Andrew M. Saul Tuesday that “the proposed rule would dramatically increase the number of CDRs the agency conducts every year and burden millions of Americans with disabilities with more frequent, unjustified reviews of their eligibility for Social Security Disability Insurance and Supplemental Security Income benefits.”

Its no longer just a threat… Trump is cutting Social Security right now.

on Trumps $2.6 billion in cuts to #SocialSecurity disability benefits #NoSocialSecurityCuts

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How Did Trump View Social Security While Campaigning In 2015

The first aspect of Donald Trump’s stance to tackle is how he stood on America’s top social program while on the campaign trail prior to being elected the 45th president. In general, Trump views the federal government making good on payouts to workers who’ve paid into the program for decades as “honoring a deal,” as he put in his book Time to Get Tough .

What’s more, the president has advised his fellow Republicans to approach the issue cautiously. While speaking at the Conservative Political Action Conference in 2013, Trump said the following:

As Republicans, if you think you are going to change very substantially for the worse Medicare, Medicaid, and Social Security in any substantial way, and at the same time you think you are going to win elections, it just really is not going to happen … What we have to do and the way we solve our problems is to build a great economy.

In other words, Trump understands that if direct resolutions are made to Social Security , some groups of people are going to be worse off than they were before. That makes direct fixes to the program a dangerous game to play when nearing an election.

President Trump signing paperwork at his desk in the Oval Office. Image source: Official White House Photo by Shealah Craighead.

President Trump Wont Destroy Social Securitybut Hes Not Going To Save It

    Former Vice President Joe Biden is running campaign ads that claim President Trump signed an executive action directing funding cuts for Social Security and proposed slashing hundreds of billions of dollars from the Social Security Trust Fund every year.

    The problem is, however, that this just isnt so.

    A Biden campaign TV ad falsely claims that a government analysis of President Donald Trumps planned cuts to Social Security shows that if Trump gets his way, Social Security benefits will run out in just three years from now, says FactCheck.org.

    The cliche politics aint beanbag exists for a reason: Campaigns use overhyped rhetoric to distort their opponents positions and make them appear less electable. Seniors should rest easy and understand that their Social Security benefits arent going anywhere.

    But this dynamic of misleading charges belies a more fundamental problem: Something will eventually need to be done to buttress Social Securitys finances. Episodes like this dont bode well for future attempts to reform Social Security.

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    Biden Claims Trump Has Planned Cuts To Social Security By Killing The Payroll Tax What Are The Facts

      CHARLOTTE, NORTH CAROLINA – AUGUST 24: U.S. President Donald Trump waves on the first day of the … Republican National Convention at the Charlotte Convention Center on August 24, 2020 in Charlotte, North Carolina. The four-day event is themed “Honoring the Great American Story.”

      Last week, I objected to Kamala Harriss claim that Trumps plan would cause Social Security checks to stop coming.

      Now, the Biden campaign itself has a commercial, with Biden-approved text:

      The Chief Actuary of the Social Security Administration just released an analysis of Trumps planned cuts to Social Security. Under Trumps plan, Social Security would become permanently depleted by the middle of calendar year 2023. If Trump gets his way, Social Security benefits will run out in just 3 years from now. Dont let it happen. Joe Biden will protect Social Security.

      I cant even begin to say how false this is.

      The Chief Actuary did not release an analysis of Trumps planned cuts. They responded to a request by Senate Democrats to evaluate a hypothetical scenario in which payroll taxes were eliminated without replacement. But Donald Trump has said, of his proposal to eliminate payroll taxes, That money is going to come from the General Fund. In other words, it will be funded by the same set of revenues and borrowed money as every other sort of expense of the federal government that doesnt have a dedicated revenue source.

      Trump Has Tossed Around A Number Of Surprising Solutions

      The reality of Trump

      Of course, it’s also important to understand that Trump’s views on Social Security have changed considerably over time, and he has, on occasion, tossed around a number of ideas that you may find surprising.

      Back in 2000, in his book The America We Deserve, Trump proposed the idea of a one-time 14.25% tax on individuals with a net worth of more than $10 million. In Trump’s view, this one-time tax would have allowed the federal government to collect enough revenue to pay off its national debt , saving it $200 billion annually on interest payments. Trump proposed taking $100 billion of this $200 billion in annual savings and adding it to the Social Security program over a 10-year time frame.

      Donald Trump has also loosely tossed around the idea of means-testing for benefits. Means-testing would partially reduce or eliminate Social Security benefits once an individual or couple crosses above a preset earnings threshold. Since Social Security was designed to predominantly protect low-income workers during retirement, such a move would ensure that the rich aren’t receiving payments they don’t need.

      Trump even once offered up the idea of partially privatizing Social Security — a view he now steers clear of. In The America We Deserve, Trump suggests that workers have the option of utilizing personal accounts to invest in stocks, bonds, diversified mutual funds, and bonds funds.

      The point being that Trump may be more open to a middle-ground solution than most folks realize.

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