What a Trump Presidency Could Mean for Disabled Americans

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Holly Whitman

Holly Whitman is a writer and journalist based in Washington DC. She loves to share her thoughts on the intersection of politics and culture, and writes on everything from feminism and human rights to climate change and technology.

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  1. Avatar Chip Daniels
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    says:

    Medicare and Social Security are only as safe as the GOP is sensible, which is to say, not very.

    The Dems need to make them own this, every bit of it and hang it around their necks in 2018.Report

  2. Avatar notme
    Ignored
    says:

    If this is about social security then what are the first four paragraphs for? I guess they are there for general Trump/GOP bashing.

    Personally, I say it let the train wreck, then we might get a real solution.Report

    • Avatar Kim in reply to notme
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      says:

      So you voted for Hillary?Report

    • Avatar Kazzy in reply to notme
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      says:

      “We’re supposed to be talking about how bad Trump is for social security. Not how bad he is about all these other things. Let’s just focus on one area of badness and not the other areas of badness.

      I won’t refute the badness… or otherwise respond to your post. I’ll just imply your biased. For reporting a variety of verifiable facts that demonstrate Trump’s badness.”Report

    • Avatar Murali in reply to notme
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      says:

      I’m going to have to agree with notme here. There are at least 3 distinct issues that are implicated here.

      1. Trump has been in the past, probably still is now and maybe will be an asshole to lots of people in the future, among them the disabled.

      2. Ryan’s social security privatisation plan. Not all privatisations are the same. The goodness of the plan are going to depend on the specifics.

      3. Raising payroll taxes

      4. People need to be afraid of Ryan’s plan.

      1. Trumps assholery may embolden hate crime, but that has little to do with the fate of social security. So, you do spend too much time talking about trump’s assholery here.

      2. The details of Ryan’s plan and whether it would in fact be good for those in need in the short and long terms is an interesting debate to be had, but it needs to be argued for, not assumed at the outset.

      3. The connection between payroll taxes and social security is largely spurious. Social security is not funded specifically by payroll taxes and the bundling of the two is largely a political fiction. Moreover, payroll taxes are regressive. Even more importantly, raising payroll taxes depresses employment, which is why it is a good, but often underutilised keynesian fiscal lever. Also, given the rather direct effect payroll taxes have on employment, increasing payroll taxes is going to cut into employment more sharply than raising income taxes. If you want to increase revenue you would do better to institute a VAT or raise income taxes.*

      4. Even if Ryan’s plan is a bad one, its unlikely to get passed. Trumpism qua economic doctrine, as you hint in your piece is less pro market than republican doctrine traditionally has been (and definitely less pro market than Ryanism).

      *In fact a VAT would have the effect of increasing savings and thus stabilising the financial sector. And again, its a very useful tool to have when you want to stimulate consumption if you are in a liquidity trap.Report

      • Avatar Chip Daniels in reply to Murali
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        says:

        Social security is not funded specifically by payroll taxes

        What do you mean by that?

        From the SS website:
        Social Security is financed through a dedicated payroll tax. Employers and employees each pay 6.2 percent of wages up to the taxable maximum of $118,500 (in 2016), while the self-employed pay 12.4 percent.Report

        • Avatar James K in reply to Chip Daniels
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          says:

          @chip-daniels

          As I understand it, there’s no legal requirement that the payroll tax revenue go specifically to social security. Money is fungible and the payroll tax is just another tax.Report

          • Avatar Chip Daniels in reply to James K
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            says:

            Huh, you mean, politicians can raid the trust fund to spend on goodies, then turn around and claim it is going broke?

            Who would do such a thing?Report

          • Avatar Chip Daniels in reply to James K
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            says:

            Actually, the Payroll tax IS supposed to go specifically to the Social Security Trust fund, which is supposed to invest the money in Treasury Bills, and add the interest income to the Trust Fund.

            The idea is that the Trust Fund is a standalone account, wholly separate and apart from the general funds.Report

          • Avatar Gaelen in reply to James K
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            says:

            I don’t think this is accurate. The SS trust fund has been raided to pay for other things, but the payroll tax is specifically required to go to SS trust fund.

            ed. Chip beat me to it. TwiceReport

          • Avatar Michael Cain in reply to James K
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            says:

            SS is currently based on the report produced by the Greenspan Commission in 1983 (yes, that Greenspan). Congress enacted it, but without strong guarantees that the assumptions of the plan would be followed. The main features of the plan were: (a) payroll taxes at the current rates; (b) on the near order of 90% of earned income would be subject to the tax; (c) excess revenue from the tax would be invested in Treasuries; (d) Congress would balance the budget, so the public debt would effectively be transferred from out-of-government bond holders to the SS Trust Fund; (e) as needed when the Boomers retired, the Trust Fund bonds would be redeemed by selling bonds to non-government actors.

            The share of earned income taxed began declining almost immediately, is currently around 83%, and is still falling. Bad choice of formula, that assumed productivity gains would be shared uniformly across all income levels.

            Congress has generally continued to spend like a drunken sailor, with little regard overall to the size of the debt. This raises the specter that redeeming the bonds will mean using other tax revenues, and possibly raising those other tax rates.

            Increases in lifespan have been forecast *very* accurately by the SS actuaries from the beginning of the current era. The *fundamental* problem is the tax base — if that had been held at 90% of earned income, the program would look solvent across time frames much longer than the 75-year horizon.Report

            • Avatar Morat20 in reply to Michael Cain
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              says:

              FWIW, Congress was SUPPOSED to spend the excess.

              The Federal Government can’t sock away a few trillion for the Boomer retirement in the stock market (because, among other things, they’d get flat out robbed because large amounts would have to be liquidated on a known basis) or shove it into a bank.

              The only way the government can “save” a few trillion without distorting the economy is to time-shift it. So the basis of the 1983 deal was as follows:

              1. Payroll taxes go up, to generate surplus income into the SS system.
              2. Taxes on high earners (those who feel little to no bite from the increase in SS taxes) go down by the same amount.
              2b. This makes the whole thing economically neutral. The government neither brings in nor spends any more or less than before.
              2c. The surplus SS is turned into bearer specific T-bills (borrowed FROM the trust fund TO the general revenue) to continue spending as before.
              3. When the Trust fund is redeemed, taxes on the folks in (2) are supposed to go back up to cover the redemption.

              This is how the government saves trillions for later without distorting the economy — you tell one group they get a tax break for 30 or 40 years in return for taxes going back up when the bill comes due.

              Of course, like anyone with a debt, they’d prefer not to pay.

              Congress spending the surplus SS funds was actually intended, not Congress being irresponsible. Running a surplus of trillions would be….bad for the economy.

              What’s irresponsible is, of course, trying to write off the whole Trust Fund as “accounting tricks” to deny the very economic and legislative intent of the original solution, in order to avoid paying a debt.Report

              • Avatar Brandon Berg in reply to Morat20
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                says:

                3. When the Trust fund is redeemed, taxes on the folks in (2) are supposed to go back up to cover the redemption.

                One little problem there: (2) preceded (3) by thirty years. There’s some overlap, but for the most part it’s a different group of people.

                Of course, like anyone with a debt, they’d prefer not to pay.

                I’m never ceased to be amazed at how self-righteous people can be about their sense of entitlement to other people’s money. There is no debt. A handful of high earners were carrying a wildly disproportionate share of the tax bill. The government agreed to allow them to carry a slightly less wildly disproportionate share of the tax bill, and for some reason you think this means that a different group of people thirty years later, themselves already paying a wildly disproportionate share of the tax bill, are in debt? Did you learn accounting from Bud Abbott?Report

        • Avatar Murali in reply to Chip Daniels
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          says:

          money is fungible. You can in principle take money from the rest of the budget to cover shortfalls in social security benefit payouts. Maybe cut your military spending… or anything else that strikes your fancy. Legally speaking the government can in principle raid the social security fund to balance budget shortfalls. It has no legal obligation to make any payouts. That is why reducing the social security benefit is an option even if not a particularly popular one. But if USgov can reduce benefits and raid the fund to cover the budget, it can also raid the budget to cover social security payments.Report

      • Avatar Brandon Berg in reply to Murali
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        says:

        Moreover, payroll taxes are regressive.

        People make way too big a deal over the progressivity or regressivity of specific taxes. The regressivity of the Social Security tax is more than offset by the heavy progressivity of the income tax, for which a huge chunk of people pay nothing at all. Many even pay negative federal income taxes via the EITC. Then there’s the fact that Social Security and Medicare payments are more regressive than their respective taxes, with people at the low end of the income spectrum getting much more back per dollar paid in than people at the high end. What really matters is the tax and transfer system as a whole, which is very strongly downwardly redistributive.

        The employment issue could valid concern. In an ideal labor market, wages would fall to offset the higher employer tax, but nominal rigidities could prevent that from happening and lead to lower employment. However, it would be a very small increase. We don’t see large disemployment effects from raising the minimum wage 10%, so it seems unlikely that a 1-2% increase in the employer-side tax would have a large disemployment effect.Report

      • Avatar LeeEsq in reply to Murali
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        says:

        Not all privatizations are the same but the idea that Paul Ryan or any Republican is going to produce a good or even adequate privatization program are slim. The policy preferences of Republican politicians have generally shown a tendency to give more money to people who already have a lot of it. Other privatization programs amounted to get rich schemes for those lucky enough to afford it. The Republicans have also demonstrated a general hostility towards the welfare state for decades.

        Jonathan Chait observed in the past that Republican politicians simply do not believe in luck for the most part. Those that are wealthy deserve their wealth because of hard work even though that hard work might mean being born to the right parents. Those who suffer a bad break deserve it because they did something wrong even if determining what they did wrong is impossible or it was something that they could not avoid. Even at its best, American policy is horrible for people who are having a bad break or a series of them. The general tendency of Republicans not to believe in luck or see it as irrelevant means that this is going to get worse.Report

        • Avatar Brandon Berg in reply to LeeEsq
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          says:

          The policy preferences of Republican politicians have generally shown a tendency to give more money to people who already have a lot of it.

          To be clear, by “give more money” to them, what you actually mean is take slightly less money from them. Why do Democrats always insist on this dishonest framing?Report

          • Avatar rmass in reply to Brandon Berg
            Ignored
            says:

            Well if yall would admit that yes no one built that themselves, and that the things that make the system work cost money, so tax where the money is. We dont tax the rich for moral benefit, we do it because thats where the money is.Report

          • Avatar P Herr in reply to Brandon Berg
            Ignored
            says:

            A couple of points. First the payroll and income taxes are on money not people. So if some people have all the money they will and should indeed pay all the tax.

            Second, you assume that the labor market distribution is just. The amount going to certain players, iin my judgement, is out of proportion to their contribution to the sociey in part due to their power. As a case in point, some CEO’s took huge salaries and bonuses during the financial crisis even as their companies were collapsing. Over the last approximately fifty years, most of the financial gains our society have gone to the very top. Are the top income people really making that more of a contribution to our society than their counterparts in the 70’s? You also ignore the role of inherited wealth. How does that square with the the assumption of a meriterious distribution of income that you imply?
            So your language about dishonest framing could also be said to be dishonest.Report

  3. Avatar fillyjonk
    Ignored
    says:

    I dunno. I’m a Gen Xer who has pretty much accepted that Social Security will either be greatly reduced or nonexistent for me (Medicare going away is a bigger worry for me). I’m fortunate in that I make enough to (by living very frugally) put away some money each month and hope I’ve chosen wise investments for it. But yeah: I think the systems do need to be reformed in some way and probably a lot of the entitlements are unsustainable at this point, but the only way out is through, and through is going to suck mightily for a lot of people – the people who depended on something that’s going away and the people who paid into a system all their lives only to hear “thanks, but the ‘lockbox’ is empty” when they get to the point of needing help.

    I also have a couple of disabled relatives who survive on SSI (and on small amounts of money funneled their way by wealthier relatives). SSI is very hard to survive on, even in a small rural area where you are living in a family home that was paid for long ago. (I suppose if one disabled relative in particular outlives my parents, it will then fall on me to help support them.)Report

  4. Avatar Will H.
    Ignored
    says:

    Option 1: Raise the Social Security Payroll Tax:
    Did it.
    In fact, Clinton doubled the payroll tax.
    Doubled it.

    Option 2: Raise the Retirement Age:
    Reagan’s idea.
    Not one I was particularly happy with.
    My thoughts:
    No more raising it until current payouts are included.

    Option 3: Raise More Money:
    Another bake sale?
    Great idea.
    I need something chocolatey right now.

    Other thoughts:
    Social security is an insurance program.
    It’s insurance that’s bought an paid for.

    How is it that Mutual of Omaha could make money selling insurance and still sponsor Marlin Perkins on safari?

    We need to find a way to bring back Marlin Perkins.

    Making money selling insurance wouldn’t be bad either.Report

    • Avatar Brandon Berg in reply to Will H.
      Ignored
      says:

      Option 1: Raise the Social Security Payroll Tax:
      Did it.
      In fact, Clinton doubled the payroll tax.
      Doubled it.

      You sure about that?

      Social security is an insurance program.
      It’s insurance that’s bought an paid for.

      That’s the ad copy, yes, but the reality is somewhat more complicated. Low-income workers pay less than an actuarially fair “premium” (i.e. tax) for their future payments, and high-income workers pay more. If high-income workers were taxed at an actuarially fair rate, there wouldn’t be enough money to subsidize the low-income workers.

      Basically, it’s welfare tarted up to look like insurance.Report

      • Avatar Chip Daniels in reply to Brandon Berg
        Ignored
        says:

        Basically, it’s welfare tarted up to look like insurance.

        Actually, I agree with this, maybe for a different reason.

        The biggest weapon against social security is to compare it to a private retirement account, or to show how some people withdraw more than they put in.

        It is explicitly NOT an investment account, but a guaranteed government income supplement, with the intention of preventing poverty in old age.

        As with public schooling, it is universal, meaning it gives out to all comers regardless of ability or means.Report

        • Avatar Burt Likko in reply to Chip Daniels
          Ignored
          says:

          As with public schooling, it is universal, meaning it gives out to all comers regardless of ability or means.

          Yet there are those who say we can’t get to UBI from here. Reminds me a bit of those who said we can’t get to single-payer healthcare from here, and then apply for Medicare benefits.Report

          • Avatar Kolohe in reply to Burt Likko
            Ignored
            says:

            There’s something honestly I never really though well before right now.

            UBI pushes Social Security into insolvency a *whole* lot faster, by the very incentives UBI advocates deem its best features.Report

            • Avatar North in reply to Kolohe
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              says:

              Err yes but wouldn’t UBI simply replace social security?Report

              • Avatar Burt Likko in reply to North
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                says:

                And a whole bunch of other social welfare programs too.Report

              • Avatar Kolohe in reply to North
                Ignored
                says:

                I don’t think you can get there from there. UBI replacing other so called welfare programs is pretty straightforward, but social security has a completely different constituency and set of stakeholders.

                Put it this way – if Speaker Ryan made it part of a Grand Bargain this coming term, would enough people go for it on his own side, and would anyone go for it on Pelosi’s side?Report

              • Avatar Brandon Berg in reply to Kolohe
                Ignored
                says:

                Replacing Social Security with a truly basic income would result in a lot of retirees taking a substantial pay cut. If you don’t take early retirement, Social Security replaces 90% of your long-run average income up to about $10,000 per year, then 32% of the next $52,000 or so, and then 15% of the next $57,000. The maximum benefit is around $34,000 per year, for those whose income exceeded the tax cap for 35 or more years, and even more for those who also delayed retirement a few years past the full retirement age.

                I imagine that somebody getting $25,000 per year from Social Security would not be happy with the prospect of having it replaced with a $10-15,000 basic income.Report

              • Avatar Jaybird in reply to Brandon Berg
                Ignored
                says:

                We’d explain to them that they’d be doing it for the society.Report

              • Avatar Stillwater in reply to Brandon Berg
                Ignored
                says:

                “Replacing Social Security with a truly basic income would result in a lot of retirees taking a substantial pay cut.”

                Not necessarily. Those disbursements could still be made during a phaseout period.Report

              • Avatar Autolukos in reply to Stillwater
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                says:

                This seems like a tough sell to voters who will be getting the reduced payment but paying for the higher one for current recipients.Report

              • Avatar Stillwater in reply to Autolukos
                Ignored
                says:

                Who’s getting reduced payments? Wealthier folks get their payments during a phaseout, everyone else gets their payment.

                Add: maybe I don’t understand the question. A UBI would increase everyone’s “payment”, just in a different form. Allocations would be direct (cash, or maybe HC vouchers) rather than indirect (program benefits).Report

              • Avatar Stillwater in reply to Stillwater
                Ignored
                says:

                Btw, the libertarianish’s (seemingly) sudden resistance to the UBI is sorta surprising to me, in the same way that the Dem/liberalish’s new-found love of neoliberalism is surprising.

                Thanks Trump!Report

              • Avatar Jesse Ewiak in reply to Stillwater
                Ignored
                says:

                “Btw, the libertarianish’s (seemingly) sudden resistance to the UBI is sorta surprising to me”

                It’s almost as if some libertarians never actually supported UBI, but wanted an answer to the “you hate poor people” charge that could never come into practice.

                Now, that it’s an actual possibility, libertarians are suddenly finding flaws in the UBI they never looked into during the past 20 to 30 years when it was the ‘fix’ to get rid of all that unwasteful gov’t spending.Report

              • Avatar Autolukos in reply to Stillwater
                Ignored
                says:

                If I’m understanding your proposal right, you still have people who, under the current SS formula, would receive more than the UBI in the future but who end up receiving only the UBI. A gradual phaseout is probably an easier sell than a simple replacement that hits current SS beneficiaries, but it does leave the awkward task of convincing people to fund SS at its current level while being promised a lower future benefit.

                This also creates an opportunity for Congress to meddle with the phaseout, along the lines of the constant postponement of Medicare reimbursement cuts. Even if you convince people to accept the phaseout of the higher benefit once, I expect that it would be repeatedly extended.Report

      • Avatar Michael Cain in reply to Brandon Berg
        Ignored
        says:

        That’s the ad copy…

        Spot on. It is, and always has been, a PAYGO public pension program. The Trust Fund was always intended to smooth out variations in income and outgo. In 1983 it was additionally structured so that the Boomers would pay for some portion of their own retirement, as well as their parents and grandparents, sparing the smaller later generations some of that pain.

        FDR often said what it was in private, and added that Americans would never vote for a public pension program so it had to be described otherwise.Report

  5. Avatar Chip Daniels
    Ignored
    says:

    Solutions to Social Security are not mysterious or new or even that difficult. It is a wildly popular program, and most people even support raising their own contributions.

    But there is a determined caucus of voices that want to obscure that fact, and present it as a lifeboat dilemma.Report

  6. Avatar Damon
    Ignored
    says:

    The only thing the President can do is veto or sign legislation. It’d be more accurate to say “What a GOP Congress Could Mean for Disabled Americans”

    The fundamental problem with SS is that it relies on currently employed people to pay retiree benefits. It’s essentially a transfer from working people to retired people that moves funds through the Treasury Dept. (And keeps the dept incurred off books for budgetary purposes) As Congress has increased benefits, expanding those covered, the life expectancy got longer, we find ourselves in this problem, which has been going on for decades, as noted above.

    But SS isn’t that much of a problem. Medicare? That’s a bigger nut to crack.Report

    • Avatar Will H. in reply to Damon
      Ignored
      says:

      The only thing the President can do is veto or sign legislation.

      Not really.
      The real power of the Presidency is in setting the administrative policies of all the agencies under the executive.
      Signing legislation is a secondary gig.Report

      • Avatar Damon in reply to Will H.
        Ignored
        says:

        Yes, but in the context of this posting, he cannot do much. The SS rules are law. Sure, he can probably tweak the process of how the admin does things, but changing the age of benefits, the amounts, etc., unless I’m wrong, is the responsibility of congress.Report

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