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Trump’s plan for Social Security risks undermining its future

Medicare Health Insurance Card. Social Security Card with Stethoscope and pen
Bill Oxford/Getty Images

On the campaign trail, Donald Trump promised to end taxes on Social Security benefits. Many seniors naturally responded positively to this idea, and he was rewarded with their votes. It’s easy to see why many would agree with this idea on the surface. After all, workers already pay taxes on their earnings throughout their careers. These taxes are used to fund future Social Security benefits. Retirees would be excused for thinking that they’re being taxed twice.

However, the reality is far more complicated — and potentially disastrous. By law, taxes on Social Security benefits are funneled back into the Social Security and Medicare trust funds. Ending this revenue stream would have serious financial consequences, accelerating the insolvency of both programs. This would put the benefits that millions of American seniors depend on at grave risk.


The numbers tell a bleak story. A Wall Street Journal piece notes the Committee for a Responsible Federal Budget found that ending taxes on Social Security benefits would reduce revenue to the Social Security and Medicare trust funds by between $1.6 trillion and $1.8 trillion over the next decade. This would accelerate the insolvency of Social Security by a full year, bringing its projected bankruptcy date to 2032. Medicare would fare even worse, facing insolvency in 2030 — six years earlier than current projections.

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The consequences of these changes would be dire. Without enough funding, Social Security and Medicare would face catastrophic benefit cuts, forcing millions of seniors to suffer due to reduced incomes and limited access to health care. These programs were designed as safety nets, but Trump’s proposals would rip giant holes in that fabric, leaving some of America’s most vulnerable citizens exposed.

Trump’s promise to end taxes on Social Security benefits is just one piece of a broader campaign to reduce taxes on income such as tips and overtime pay. While these ideas may seem attractive to the average taxpayer, together they threaten to explode the federal deficit. These policies ignore the critical role tax revenue plays in sustaining essential programs and ensuring their long-term viability.

The short-term appeal of these proposals must be carefully balanced against their long-term consequences. While seniors might save a small amount initially, the financial foundation of Social Security and Medicare would crumble, creating a much greater economic burden in the future. Popular promises often carry hidden costs, and in this case, the cost would be the stability of the very programs that seniors rely on.

The debate over taxing Social Security benefits raises legitimate questions about fairness in the tax code. However, solutions that undermine the solvency of critical programs are plainly reckless. Instead of proposing policies that threaten Social Security and Medicare’s future, Trump should focus on strengthening these systems to ensure they can support current and future generations.

Trump’s plan played well on the campaign trail, but its implications are clear: His promises risk dismantling the foundations of America’s social safety net. For the millions of Americans who depend on these programs, that is a gamble they cannot afford.

Cropf is a professor of political science at Saint Louis University.

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Under Republican President Dwight D. Eisenhower, people who earned more than $400,000 a year paid a top tax rate of 92%. Today's top rate is 37%.

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Taxing the Rich To Pay for Trump Priorities Wouldn’t Slow Economic Growth

Reports of the Trump administration considering taxing wealthy Americans to pay for mass deportations and other priorities come on the heels of a new study showing how the move could generate significant revenues without slowing economic growth.

Mary Eschelbach Hansen, associate professor of economics at American University and the report's co-author, said raising tax rates for people who earn more than $609,000 a year to 44% would add 3% to the nation's tax coffers, enough to stave off cuts to popular programs serving low-income Coloradans.

"In current budget proportions, that's about enough to pay for some of the biggest, most important programs like food stamps SNAP, Children's Health Insurance Program, and also Temporary Assistance for Needy Families," Eschelbach Hansen outlined.

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Eschelbach Hansen argued raising the top tax rate would also increase how much of the national income pie most Americans get to keep, compared to how much the wealthiest get, by about 2%. She added years of trickle-down economics have shown only the wealthy benefit from low tax rates.

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Eschelbach Hansen stressed higher personal tax rates have virtually no impact on long-term economic growth, and lower personal tax rates lead to less economic growth, because people tend to take advantage of the lower rate by moving their income.

"Instead of reinvesting it in your business, where it will grow your business and grow the economy, you'll be more likely to just take it as personal income, which is not going to stimulate growth," Eschelbach Hansen explained.

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