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Is Trump Planning To Cut Social Security

Is Trump Defunding Social Security And Medicare Concerns Mount After President’s Executive Order

The Payroll Tax Cut will have no impact on Social Security

President Donald Trump’s Saturday decision to sign an executive order to defer payroll taxes has fueled concerns that he is attempting to defund Social Security and Medicare, with the latest order drawing criticism from conservatives and liberals alike.

“First one is on providing a payroll tax holiday to Americans earning less than $100,000 per year,” the president said during a Saturday press briefing. “In a few moments, I will sign a directive, instructing the Treasury Department to allow employers to defer payment of the employee portion of certain payroll taxes…”

Trump said that he would make the temporary tax deferral permanent if he was re-elected in November. “So I’m going to make them all permanent,” he said.

Notably, this is not a tax cut. Under the wording of the executive order, the payments would simply be deferred until next year unless further actions were taken.

Whether Trump’s executive orders, which also provided an extension of extra federal unemployment benefits at a reduced rate of $400 per month, will withstand legal scrutiny is a matter of debate. His decision came as Republicans and Democrats in Congress remained at an impasse over a new round of coronavirus economic stimulus legislation. Under the Constitution, Congress, not the Executive Branch, is granted power over spending federal funds.

Republicans And Democrats Keep Switching Sides On This Debate Here’s What You Need To Know

President Trump was supposed to be different kind of Republican: Back in 2015, he promised to “save Medicare, Medicaid, and Social Security without cuts.”

Fast forward to this week, when Trump’s new national budget proposal was released. Democratic presidential contenders like Sen. Kamala Harris , Sen. Bernie Sanders , and Sen. Amy Klobuchar are all pouncing on the president for supposedly including $845 billion in cuts to Medicare in his budget’s 10-year window. Meanwhile, Trump’s budget director is firing back that it isn’t true.

Which is it? Does Trump want to cut Medicare or not? The answer is complicated.

Usually, what people imagine when politicians talk about “cuts to Medicare” is benefit reductions: Seniors getting less coverage, fewer drugs and procedures, or having to pay more money out of pocket. For the most part, those kinds of cuts aren’t in Trump’s proposal. Instead, his budget looks to reduce what Medicare pays to doctors and hospitals and private insurers for all those things. Hence the argument, from Trump’s acting Office of Management and Budget Director Russ Vought, that they’re “not cutting Medicare in this budget.”

The funny part is that the two parties found themselves in opposite roles over the exact same issue several years ago.

That’s politics for you.

But do these sorts of cost-saving measures actually succeed in reducing Medicare spending without harming benefits?

Trump: ‘we Will Be Terminating The Payroll Tax After I Hopefully Get Elected

If that were to happen in January of next year, the Social Security Administration estimates that the Disability Insurance Trust Fund asset reserves would become permanently depleted in about the middle of calendar year 2021, with no ability to pay DI benefits thereafter, Goss said.

For the main Social Security Old Age and Survivors Insurance Trust Fund for retired workers, Goss said that they predict reserves would become permanently depleted by the middle of calendar year 2023, with no ability to pay OASI benefits thereafter.

In a statement reacting to the estimate, Senate Minority Leader Chuck Schumer, D-N.Y., said President Trumps plan to eliminate Social Securitys dedicated funding would endanger seniors’ Social Security and could mean the end of Social Security as we know it by 2023.

House Speaker Nancy Pelosi, D-Calif., said that the analysis shows the swift potential devastation of President Trumps reckless call to terminate the payroll tax: shattering the sacred promise of Social Security.

The letter from Goss came in response to a request from Schumer and Sens. Bernie Sanders, I-Vt., and Ron Wyden, D-Ore., after Trump said he would permanently terminate the payroll tax cut if hes re-elected in November.

Earlier this month, he said at a press conference in Bedminster, N.J., If Im victorious on November 3rd, I plan to forgive these taxes and make permanent cuts to the payroll taxIm going to make them all permanent.

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Despite Promises Trump Takes Aim At Social Security Medicare

“I’m not going to cut Social Security like every other Republican and I’m not going to cut Medicare or Medicaid,” Donald Trump in 2015. “Every other Republican’s going to cut, and even if they wouldn’t, they don’t know what to do because they don’t know where the money is. I do. I do.”

As regular readers may recall, this became a staple of his entire national candidacy: no matter what, Americans could count on him to champion these social-insurance programs. Ahead of the 2016 race, Trump wanted everyone to know that entitlement cuts, as far as he was concerned, are off the table.

A few weeks ago, however, the Republican started hedging. Over the weekend, referring to the new White House budget, Trump’s promise not to cut Social Security, Medicare, or Medicaid quietly lost one of its three pillars. He tweeted, “We will not be touching your Social Security or Medicare in Fiscal 2021 Budget.”

Part of the problem is that the president quietly scrapped a prong from his three-pronged promise. The other part of the problem is that Trump’s newest boast isn’t true, either. As the Washington Postreported:

According to Republican rhetoric from the last decade, removing nearly a half-trillion dollars from Medicare through cuts to providers necessarily counts as “cutting” Medicare.

Don’t be surprised if Democrats exploit this opportunity for the next several months.

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

Trump tells town hall he plans to cut entitlements, hopes ...

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.

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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 Recently Made Some Rather Unfortunate Remarks About The Social Security Payroll Tax That Has Caused All The Uproar

6:00 AM on Oct 4, 2020 CDT

My inbox has been inundated with emails from worried senior citizens who tell me they have heard that President Donald Trump will end Social Security if he is reelected and that the trust funds will dry up in 2023 and all Social Security checks will stop going out.

I cant imagine the president has plans to end Social Security. But it doesnt help that he says things that people can interpret to mean exactly that. Trump recently made some rather unfortunate remarks about the Social Security payroll tax that has caused all the uproar. His aides have been scrambling to come up with excuses and clarifications.

On Aug. 8, the president told a gathering of supporters, If Im victorious on Nov. 3, I plan to make permanent cuts to the payroll tax.

Because our Social Security system, like almost every other social insurance system in the world, operates on a pay-as-you-go basis, meaning that the income derived from todays tax collections is used to fund tomorrows Social Security benefits, any such major cuts to the Social Security tax would have to result in major cuts to Social Security benefits.

The very next day, White House economic adviser Larry Kudlow told reporters that the president misspoke.

I can hear many of you saying, Huh, what does that mean? So, now let me clarify the clarification for the readers of this column.

Tom Margenau

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Claims Trump Cut Social Security Mislead

CLAIM: President Donald Trump is cutting the payroll tax, and is cutting Social Security and Medicaid.

APS ASSESSMENT: Partly false. Trump has not cut Social Security, though he has said he intends to eliminate the payroll tax, which funds the retirement benefits program. He has proposed measures that would cut Medicaid.

THE FACTS: The payroll tax goes into a trust fund that pays for Social Security payments for roughly 65 million Americans. Employers and workers split paying the 12.4% payroll tax, and self-employed people pay the full tax. Medicare, the health insurance program for seniors, is funded by a 2.9% payroll tax. Medicaid, health insurance for low income people, is not funded from a payroll tax.

Even before the coronavirus pandemic caused economic turmoil, government experts estimated that Social Security would be unable to pay full benefits starting in 2035, The Associated Press has reported. The trust fund is now likely to run out even sooner, because layoffs have cut into Social Security tax collections.

In August, Trump announced employers could defer paying payroll taxes until 2021 because of the coronavirus pandemic.

The move had little impact, according to Shai Akabas, director of economic policy at the Bipartisan Policy Center, a think tank in Washington, D.C.

Also in August, Trump made a series of statements about his intent to eliminate the payroll tax.

But those work requirements have since been struck down by federal courts.

Column: Trump To Social Security: Drop Dead

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

As Congress and the White House focus on crafting another rescue measure for Americans struggling with the coronavirus, the most important question may be:

Can’t someone find a way to distract President Trump from his stupid obsession with a payroll tax cut?

We’ve explained before why a payroll tax cut is always an absurd and harmful idea, never more so than in the current crisis.

It would undermine the finances of Social Security and Medicare while failing to deliver succor to the Americans who need it most.

Max Richtman, National Committee to Preserve Social Security and Medicare

Trump hasn’t been too specific about the cut he demands, but even with a partial reduction in the payroll tax the poorest Americans would receive a few percent of the benefits, and the richest 20% would pocket half to two-thirds of the gains.

Trump has been fixed on this idea virtually since the start of his presidential term. Occasionally he has toyed with the idea of eliminating the payroll tax entirely, which would pile stupidity upon stupidity. Never has he offered a thoughtful, logical rationale for cutting the tax wholly or in part.

That’s true of his reported stance in the latest round of talks about a financial rescue for Americans. Trump has signaled that he won’t sign a rescue bill without a payroll tax cut.

It’s possible that this is just Trumpian blather, and that once a bill is on his desk he’ll sign it, payroll tax holiday or not. Let’s hope so, and let’s explain why.

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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.

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