Social Security funds could run out in 6 years under Trump plans: Analysis
Social Security’s trust fund reserves could be depleted as early as 2031 under former President Trump’s proposals, several years earlier than recent projections, according to an analysis from the Committee for a Responsible Federal Budget (CRFB).
In an analysis published Monday, the fiscal watchdog weighed the impact several Trump proposals — including his plan to end taxation of Social Security benefits, scrap taxes on tips and overtime, impose new tariffs and expand deportations — would have on Social Security’s finances over the coming years, were he to return to the White House and implement them.
The combined trust funds for Social Security retirement and disability benefits are currently projected by the program's trustees to run out in 2035, a year later than previously expected, after economic growth exceeded expectations last year.
But under Trump’s proposals, the CRFB estimated funds could run out by 2031 while increasing Social Security’s cash deficit $2.3 trillion between fiscal 2026 and fiscal 2035.
In a closer look at the price tag, the CRFB said its central estimate found the biggest cost stemmed from Trump’s proposal to do away with taxation of Social Security benefits — a move that would cost $950 billion.
The next big-ticket item, ending payroll taxes on tips and overtime pay, would cost about $900 billion, while proposed changes on tariffs and immigration could add $400 billion to Social Security’s cash deficit.
Ending taxes on tips and overtime pay would lead to a reduction in “payroll tax collection accruing to the Social Security trust funds,” and imposing large tariffs on imports could “either increase cost-of-living adjustments (COLAs) through higher inflation or reduce taxable payroll,” the analysis stated.
The CRFB also said expanding deportations could lead to fewer “immigrant workers paying into the Social Security trust funds.”
Trump’s campaign slammed the analysis in a statement Monday.
"The so-called experts at CRFB have been consistently wrong throughout the years. President Trump delivered on his promise to protect Social Security in his first term, and President Trump will continue to strongly protect Social Security in his second term,” Trump campaign national press secretary Karoline Leavitt said in a statement, while instead pointing the finger at Vice President Harris, saying immigration under her agenda “would cause Social Security to buckle and collapse.”
The CRFB said Harris’s plans to increase border security and extend some parts of Trump’s signature 2017 tax law could “expand Social Security’s deficits by reducing revenue collection from payroll taxes and taxation of benefits.” But the group said her campaign’s proposal overall would not “have large effects on Social Security trust fund solvency.”
“At the same time, increases in the minimum wage and various tax compliance measures would likely reduce Social Security’s deficits by boosting payroll tax collection,” the CRFB said. “On net, these changes are likely to modestly increase ten-year deficits and advance insolvency by several weeks or months.”
The watchdog additionally forecast potentially bigger cuts to benefits upon insolvency under Trump’s proposals than under current law. The group estimated a 33 percent cut to benefits after tax for roughly half of beneficiaries under Trump's plans, compared to 23 percent under current law.
“But they would be cut by closer to 30 percent for the seniors with just enough income to be paying taxes on benefits, 26 percent for a household with income in retirement at about $100,000 per year, and 3 percent for the very highest income households,” the group said while assessing the potential impact of Trump’s proposed policies thus far.
Trump has said on the campaign trail that he will not “cut one cent from Social Security.” But experts say that lawmakers will likely need to find common ground on hiking taxes or reducing benefits, or both, to prevent across-the-board benefits cuts if the program goes insolvent in the years ahead.
“Restoring solvency over the next 75 years would require the equivalent of reducing all future benefits by 24 percent or increasing revenue by 35 percent,” the CRFB said in its analysis.
Recent scoring from the group on Trump’s previous Medicare proposals have been more favorable for the former president, however. A CRFB analysis looking at his last budget proposal as president found the proposals offered at the time would have “strengthened” Medicare’s fiscal position and “modestly slowed” its cost growth.
Date: | |
Tag: | Donald Trump |
Topics
-
Top stories - CBS News
Trump's Social Security plan could lead to 33% benefits cut: Analysis
8 hours ago - Donald Trump -
Business - CNBC
Trump plan would make Social Security insolvent in just 6 years, budget group says
5 hours ago - Donald Trump -
Business - CNBC
Social Security's retirement trust fund may run out in nine years. Here's how the next U.S. president may address that
2 days ago -
World - The Guardian
Fungi could be given same status as flora and fauna under conservation plan
5 days ago -
Top stories - CBS News
SBA runs out of funding for disaster relief loans after Helene, Milton
6 days ago -
Sports - ESPN
LCS takeaways: Yankees grab Game 1, Mets pull even
6 days ago - MLB -
World - The Guardian
Birth control pills and condoms could be free for millions in US under new plan
11 hours ago -
Top stories - The New York Times
How Trump’s Radical Tariff Plan Could Wreck Our Economy
4 days ago - Donald Trump
More from The Hill
-
Politics - The Hill
Researchers say Arkansas may have 19M tons of lithium critical for battery power
1 hour ago -
Politics - The Hill
Judges reject GOP overseas ballot challenges in Michigan, North Carolina
1 hour ago -
Politics - The Hill
Austin makes political message in Ukraine trip
1 hour ago - Ukraine -
Politics - The Hill
The White House's plan to boost contraception access
2 hours ago -
Politics - The Hill
Walz grills Trump for McDonald's 'cosplaying'
2 hours ago - Donald Trump
Latest in Politics
-
Politics - The Hill
Researchers say Arkansas may have 19M tons of lithium critical for battery power
1 hour ago -
Politics - The Hill
Judges reject GOP overseas ballot challenges in Michigan, North Carolina
1 hour ago -
Politics - The Hill
Austin makes political message in Ukraine trip
1 hour ago - Ukraine -
Politics - NBC News
Trump campaigns in North Carolina as race tightens
1 hour ago - Donald Trump -
Politics - NBC News
Harris barnstorms in three crucial swing states
1 hour ago