Trump, Biden trade shots over struggling finances of Social Security and Medicare
ATLANTA (TND) — Both presidential candidates accused each other of running Social Security and Medicare into the ground at their debate in Atlanta Thursday night as both popular entitlement programs are facing serious budget shortfalls in the next decade that could result in stiff benefits cuts without congressional intervention.
The long-term finances of the programs are one of the chief problems facing Washington over the next decade and certain to be a part of budget battles on Capitol Hill for years to come. Without action from Congress, both are destined to automatic benefit cuts.
Having access to the entitlement programs is an important issue for millions of the nation’s seniors and retirees and coming up with a solution was one of the questions posed by the debate’s moderators.
When asked to name one step they would take to improve their finances, Trump and Biden mostly took turns accusing each other of destroying the programs or trying to enact cuts.
Biden pointed to his proposal to raise taxes on the wealthy and said that his plan would make the programs solvent again without offering clear details. He said the biggest thing the country can do is vote against Trump in November.
“He wants to get rid of Social Security, he thinks there’s plenty to cut in Social Security. He’s wanted to cut Social Security and Medicare,” Biden said. “The idea that we don’t need to protect our seniors is ridiculous.”
Trump accused Biden of destroying the popular benefits by trying to put people entering the country illegally onto them, a misleading claim he made multiple times as he pivoted away from questions asked by moderators to discussing the situation at the southern border.
“He will wipe out Social Security. He will wipe out Medicare,” Trump said.
Biden and Trump have vowed to protect Social Security and Medicare but exactly how they would accomplish that is unclear. Biden has offered proposals to raise taxes on wealthy Americans to fill some of the gaps, but experts have questioned exactly how effective they would be.
Trump has gone back and forth between being open to cuts to the programs and making pledges to protecting the benefits since first entering national politics and his campaign has not released a plan to make the programs financially whole.
Medicare’s hospital insurance trust fund will reach insolvency in 2036 after this year’s trustees report found higher payroll taxes brought in additional revenue and expenses came in under projections. Once its reserves are depleted, Medicare would only be able to cover 89% of costs for hospital visits, hospice care and nursing homes. Medicare covered around 66 million people last year, a majority of which are 65 and older.
Social Security, which provides income to people 67 and older or those with a disability, is on pace for its reserves to run out in 2035, a one-year improvement from last year’s projections. Once it reaches the “go broke” point, it would only be able to pay out 83% of benefits to the roughly 71 million Americans that receive them.
Despite knowing about the looming fiscal crisis facing Social Security and Medicare for decades, Congress has been unable to come together on a plan to fix the budget hurdles. Partisan politics and the stiff unpopularity of all the remedies to the budget woes — raising the retirement age, cutting benefits and raising taxes — are all deeply unpopular with voters.
Receiving full benefits is especially important for America’s seniors and soon-to-be retirees, who are also the most likely Americans to vote, adding to the difficulties for enough lawmakers to get on board with any plans to shore up the finances.
Both have engaged in promises to protect them and not cut benefits for seniors. But those pledges to “do nothing” to the programs will help hurdle the U.S. toward automatic cuts. An analysis conducted last year by the nonpartisan Committee for a Responsible Federal Budget found the “do not touch” approach would cut annual benefits for a typical newly retired dual-income couple by $17,400. A single-income couple would face an immediate $13,100 cut.