President Biden will be leaving the Oval Office soon, and the Social Security plan is facing a significant challenge. According to a nonpartisan watchdog group, The Committee for a Responsible Federal Budget, the program will be insolvent in nine years, but this timeline could shrink to six years if Donald Trump implements his campaign platform. The group warns that neither Kamala Harris nor Donald Trump have realistic plans to address the program’s financial issues, but Trump’s proposals would accelerate the collapse of Social Security.
The main reasons for this potential crisis are the projected economic consequences of Trump’s plans, which include ending taxation on Social Security benefits, overtime pay, and tips, as well as implementing new tariffs and mass deportations of unauthorized immigrants. The group estimates that these measures could result in a loss of $1.3 trillion to $2.75 trillion in revenue for the program over a ten-year period.
Currently, Social Security’s trust funds are projected to run out by 2034, leading to a 23% cut in benefits. However, Trump’s agenda could bring this date forward to 2031 and result in a one-third reduction in payments to retirees.
An average monthly benefit check from Social Security is $1,907, and a 33% cut would decrease this amount by $629 per month, leaving recipients with $1,278. The Trump campaign’s press secretary, Karoline Leavitt, dismissed the warning from the Committee for a Responsible Federal Budget, stating that President Trump has protected Social Security in his first term and will continue to do so in his second term.
The elimination of income taxes on Social Security benefits, which currently contribute 4% to the program’s financing, is seen as the most significant threat among Trump’s proposals. This move could cost the program $950 billion over the next decade. Additionally, removing taxes on overtime and tips could result in a loss of $900 billion by reducing payroll tax collection.
Mass deportations and stricter border measures could also deplete Social Security’s funds, as undocumented workers who contribute to the system may not be eligible to receive benefits. Furthermore, the committee suggests that Trump’s plans to increase U.S. tariffs would impact Social Security by either reducing taxable payroll or necessitating higher distributions to keep up with inflation.
Leavitt mentioned Trump’s past claims that promoting oil and gas drilling, along with other growth-oriented policies, would address Social Security’s budget shortfall. However, analysis from the committee indicates that dedicating all federal lands to drilling operations would only generate a fraction of the program’s $22 trillion shortfall over the next 75 years.
Despite claims of economic growth closing Social Security’s funding gap, the committee maintains that Trump’s plans could actually reduce long-term output in the U.S. These projections highlight the urgent need for realistic and sustainable solutions to ensure the future stability of Social Security.