Trump and Vance’s Past With Social Security: What Could It Mean for the Program?
Written by
Vance Cariaga
Edited by
Travis Woods
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Many voters have a keen interest in what 2024 presidential candidates say about Social Security, and so far the general theme is that the program should propped up rather than whittled down. The two top contenders — current Vice President Kamala Harris and former President Donald Trump — have both vowed not to touch benefits. That seems to be the case with their running mates as well, including Trump VP pick JD Vance.
No matter who wins, they’ll need to figure out how to deal with Social Security’s looming funding shortfall.The program’s Old Age and Survivors Insurance (OASI) Trust Fund is expected to run out of money within the next decade, leaving Social Security solely dependent on payroll taxes. Those taxes currently cover only about 77% of benefits.
There is also general dissatisfaction about how effective Social Security checks are at paying the bills. A survey conducted last year by public interest law firm Atticus found that nearly two-thirds of Social Security recipients are dissatisfied with the 3.2% cost-of-living adjustment (COLA) for 2024.
Trump has been clear about his intention to leave Social Security alone if he wins a second term. Last year he said that “under no circumstances should Republicans vote to cut a single penny from Medicare or Social Security.”
What Trump hasn’t done is unveil any concrete policy proposals about how to deal with the looming trust fund shortfall. As president, he left Social Security benefits and eligibility requirements alone, but he did propose cuts to Social Security and Medicare that aimed to scale back their administrative costs without specifically reducing benefits. His current campaign has not offered specific proposals to address the OASI’s coming insolvency.
More recently, Trump suggested that Social Security benefits should not be subject to federal income taxes. He addressed the topic in a July 31 post on his Truth Social network, writing that “SENIORS SHOULD NOT PAY TAX ON SOCIAL SECURITY!” The former president didn’t go into further detail on the matter.
In order to end taxes on Social Security benefits, Trump would need the cooperation of Congress. That will be a challenge unless Republicans also win the U.S. House and Senate in the 2024 elections.
Social Security benefits are subject to federal income taxes if you earn a certain amount of outside income before reaching full retirement age. Individuals with provisional income (adjusted gross income + nontaxable interest + 1/2 of Social Security benefits) above $25,000 and joint filers with provisional income above $32,000 have up to 50% of their Social Security benefits taxed. For individuals with provisional income above $34,000 and joint filers above $44,000, up to 85% of Social Security is taxed.
About 40% of seniors who receive Social Security have to pay taxes on the benefit, according to the Social Security Administration. If these taxes are eliminated altogether, seniors previously affected will not have to see their benefits reduced.
The problem is, eliminating taxes on Social Security benefits would put the program under even more stress, experts say.
“Exempting Social Security benefits from taxation will further increase the insolvency of Social Security,” George Mason University’s Veronique de Rugy wrote in a recent column for the conservative National Review.
The Committee for a Responsible Federal Budget estimates that the move would push the insolvency date of Social Security’s retirement trust fund up by more than a year. When the fund becomes insolvent, some lawmakers have suggested cutting retirement benefits to deal with the shortfall.
As for Vance: He has said he doesn’t support cuts to Social Security or Medicare, CNBC reported, citing press interviews sent by his Senate team.
“The idea that you need to mess with Social Security and Medicare to get to a long-term fiscal sanity picture … I don’t think that’s right,” Vance told Fox Business earlier this year.
But as the American Enterprise Institute noted in a recent blog, Vance “isn’t very focused on the nuts-and-bolts” how programs like Social Security work. He also “underestimates the ability of households” to pay for retirement without “ever-increasing” Social Security benefits,” the AEI added.
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