Trump promises permanent cut to payroll tax funding Social Security and Medicare if he’s reelected
S E E D E D C O N T E N T
Trump promises permanent cut to payroll tax funding Social Security and Medicare if he’s reelected
AUGUST 08, 2020
President Trump pledged on Saturday to pursue a permanent cut to the payroll taxes that fund Social Security and Medicare if he wins reelection in November, a hard-to-accomplish political gambit that some experts see as a major headache for the future of the country’s entitlement programs.
Trump unexpectedly promised the policy action as he signed a directive that aims to help cash-starved Americans amid the coronavirus pandemic. The order allows workers to postpone their payroll tax payments into next year but doesn’t absolve their bills outright — though the president said he would seek to waive what people owe if he prevails on Election Day.
“If I’m victorious on November 3rd, I plan to forgive these taxes and make permanent cuts to the payroll tax,” Trump said at a news conference in Bedminster, N.J. “I’m going to make them all permanent.”
“In other words, I’ll extended beyond the end of the year and terminate the tax,” Trump later added. “And so we’ll see what happens.”
Major changes to the tax code fall entirely to Congress, so Trump alone cannot waive Americans’ tax debts or enact permanent changes to tax law. Democrats and Republicans alike already had balked at Trump’s push for a payroll tax holiday in negotiations over the next round of coronavirus aid , suggesting a more lasting tax cut may be even tougher to secure if Trump does indeed win reelection.
In doing so, though, Trump would be embarking on a fraught process that could have catastrophic fiscal effects on programs including Social Security, which watchdogs recently have warned is in dire financial straights, expected next year to have costs that exceed its total incomes.
“By having a permanent cut, that immediately makes you ask the question on what’s going to happen on the benefits side,” Garrett Watson, a senior policy analyst at the Tax Foundation, said. “That would make it worse if you didn’t have a source of revenue to backfill [the cut].”
Shortly after Trump issued his directive, the AARP raised a series of potential problems created by the president’s order, including for employers who have to track the deferred taxes and new economic anxieties for the nation’s retirees.
“Social Security is more crucial than ever as Americans face the one-two punch of the coronavirus ’s health and economic consequences," Nancy LeMond, the group’s executive vice president, said in a statement. “But, this approach exacerbates people’s already-heightened fears and concerns about their financial and retirement security.”
For now, the exact workings of Trump’s order remain unclear. Typically, employers automatically deduct payroll taxes from their employees’ paychecks and send that money directly to the federal government. Under Trump’s order, however, those payments are postponed between September 1 and the end of the year. Trump said Saturday it would result in “bigger paychecks for working families.”
Some economists, though, questioned the wisdom of Trump’s payroll tax policy. Along with the uncertainty over how it’d actually be implemented, the directive doesn’t help some of the people facing the greatest hardship as a result of the coronavirus, said Chye-Ching Huang, the senior director of economic policy at the left-leaning Center on Budget and Policy Priorities.
“Even if people were to see a bigger paycheck in a number of weeks, the underlying policy is really poor policy,” she said. “The people who would be seeing the biggest increase in their paychecks still have jobs, still have earnings … People who lost jobs or retired or get income from other sources would see no help from this.”
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So Trump wants to campaign for the rest of the fall on a promise to defund Social Security and Medicare.
Good luck with that moron. I can see the Lincoln Project and Republicans Against Trump commercials already.
Conservatism abhors Social Security and Medicare.
Although Trump is not a conservative he does relish in the prospect of creating hardship and distress for others. He is exactly the same man in 2020 as he was in 1970.
This is not just a "Trump" thing.
Republicans in general would s upport the same actions if they thought they could get away with it.
Suspending the payroll tax does nothing for people without jobs. The benefit is to those working and the company which makes no sense. Also, it's a republican wet dream to be rid of SS and the associated programs and that is exactly what he is proposing with making the payroll tax cut permanent.
The extended unemployment benefits are to be $400 per week in which the state will have to pick up 25% or $100 dollars of this. That won't fly since the states are already picking up their full share and most states are if not now will be in the very near future in dire financial straits. They can't print money as the feds can.
This is actually one of the key factors in all of this. The federal government can always alleviate it's debt. The cities and the states cannot, which is why it makes all the sense for the federal government to be the one to be the financial source for natural disaster programs like the covid expenditures.
Cutting payroll taxes doesn’t effect benefits, or their obligation to be paid.
money is fungible.
First the funding ends then the gop cuts benefits...
Trump has repeatedly said that he has no intention to cut people’s promises social security and Medicare benefits. He said nothing today about cutting them either. Ever since congress allowed payroll taxes to be spent in everyday annual general spending budgets instead of being locked up to be spent directly upon the recipient who had them withheld it made no sense to have a separate payroll tax.
Trump lies a lot. Nobody believes his bullshit!
He lies to get what he wants then stabs backs...
You describe Obama and Biden actually.
Is that PeeWee Herman response all you have?
And, that crack was even lamer than usual...
So if Trump lies a lot, why do so many people get all up in arms when he talks? For this seed, President Trump says if re-elected he wants to work to eliminate the payroll taxes for Social Security / Medicare. If he lies then why get all worked up?
A little common sense would tell anybody that the president by himself does not have the authority to rewrite tax law, that must come from Congress. So President Trump here saying he wants to eliminate the payroll taxes is no different than Biden promising to bring about Medicare for All. It's a campaign promise that the elected president cannot do by themselves.
I realize this site would get little traffic if everybody thought about things but that's not the world we live in. I do miss a time when we could have a discussion around political differences and still be friends. Seems in today's world that just isn't allowed anymore.
Trump is counting on his supporters to continue to believe his lies and I can see by reading some comments on this thread he's right to think that. He knows they either don't understand the Constitution or they no longer care what it says.