Expert: Trump’s economic agenda could lead to Social Security cuts

A sign reads “No Tax on Social Security” as former President Donald Trump, the Republican presidential nominee, delivers remarks on his economic policy in Savannah, Georgia, on Sept. 24. Doug Mills/The New York Times

Former President Donald Trump’s economic agenda would speed up the bankruptcy of the Social Security trust fund and lead to large, automatic, across-the-board benefit cuts within the next six years, a new analysis from the nonpartisan Committee for a Responsible Federal Budget warns.

The report is based on Trump’s promise to eliminate income taxes on Social Security benefits, his proposed broad-based tariffs on imports, and his push to deport millions of undocumented immigrants. Trump’s pledges would accelerate the fund’s insolvency by three years, triggering a 33% benefit cut, according to the CRFB.

If Trump is elected and his policy ideas are implemented, a typical monthly benefit check of $1,907 in 2024 would be reduced by $629, leaving recipients with average payments of $1,278. The program currently pays out more in benefits than it collects through payroll taxes.

The CRFB notes that its analysis does not include a breakdown of Vice President Kamala Harris’s impact because her policy ideas would be negligible compared to Trump’s promises. Trump’s campaign is aggressively pushing back on the report.

“The so-called experts at CRFB have been consistently wrong throughout the years,” spokeswoman Karoline Leavitt told CNBC, adding that Trump will protect the program. Unlike Harris, whose border policies would invite millions of undocumented immigrants into the U.S. and “cause Social Security to buckle and collapse,” she said.

Harris is backing a bipartisan border bill that Trump lobbied against and effectively killed, despite the legislation containing many of the proposals Trump supports. At the time, he said he was willing to take the blame, calling the bill a bad deal for the country.

All immigrants are required to pay into the program but are not permitted to collect benefits.

One area particularly vulnerable to Trump’s positions is cost-of-living adjustments (COLA), the report notes. His support for broad tariffs on imports would increase COLA through higher inflation, further depleting the trust fund, according to the CRFB.

Americans are in this situation because of Congress’s failures, according to CRFB President Maya MacGuineas.

“I must say I worry our political leaders can’t make any hard decisions anymore,” MacGuineas said. “It seems they love to give things away and play Santa Claus.”

MacGuineas cited this year’s election as an example, saying both Harris and Trump are discussing significant tax cuts and spending increases. “It’s not the normal — oh, Democrats are big spenders and Republicans are big tax cutters. Guess what, they’re both both.”

Economists have been especially critical of Trump’s proposals. One study by the Peterson Institute for International Economics estimated Trump’s economic agenda would cause weaker economic growth, higher inflation, and lower employment over the next four years.

Researchers at the Peterson Institute created an analysis fleshing out best- and worst-case scenarios for the economy if Trump wins and follows through on his pledges.

In the best-case scenario, where only 1.3 million undocumented workers are deported and Trump avoids a global trade war, the study found that employment — measured in hours worked — would fall by 2.7% in four years relative to a baseline forecast. At the same time, inflation would climb to 6% within two years, the researchers found.

By 2028, prices would be 28% higher, and GDP would be 2.8% lower than otherwise by the end of Trump’s term.

Tackling Social Security and Medicare is especially challenging for both Trump and Harris, perhaps more so than in past years.

More than half of America’s counties — 53% — drew a large share of their total income from the government in 2022, according to a new study by the Economic Innovation Group. In 2000, that was the case in just 10% of counties overall.

Those receiving a great deal of those benefits are concentrated in key battleground states this year. Such aid makes up the lion’s share of income in about 70% of counties in Michigan, Georgia, and North Carolina. That number is 60% in Pennsylvania. All four states are considered must-win for Trump.

Leavitt argues that’s all the more reason to aggressively move to bolster Social Security and Medicare, both of which are primary drivers of the U.S. national debt, which stands at more than $35 trillion.

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