House Speaker Nancy Pelosi (D-Calif.) warned that if President Donald Trump is allowed to end the payroll tax, the Social Security Disability Insurance Trust Fund would be expended by 2021 and the Social Security Old Age Survivors Insurance Fund would be exhausted by 2023.
Pelosi said in a statement Monday that the Social Security Administration chief actuary analysis shows the potential devastating effects of ending the payroll tax, which the president has suggested.
“President Trump continues to play fast and loose with the health and well-being of America’s seniors. The new analysis today shows the swift potential devastation of President Trump’s reckless call to ‘terminate’ the payroll tax: shattering the sacred promise of Social Security,” said Pelosi in a statement Monday.
Pelosi vowed that Democrats would “stand strong” for senior citizens’ Social Security benefits.
The Speaker made the statement after Stephen C. Goss, chief actuary at the Social Security Administration, responded to Democratic Senators’ query on what the consequences would be for Social Security insurance funds if payroll tax was terminated.
Senators Chris Van Hollen (D-Md.), Ron Wyden (D-Ore.), Bernie Sanders (I-Vt.), and Senate Minority Leader Chuck Schumer (D-N.Y.) in the Aug. 19 letter asked the chief actuary to analyze the potential impact of a proposal to get rid of Social Security’s payroll and self-employment taxes, both paid by employers and employees, on Social Security insurance.
“Specifically, what would be the implications of such legislation for revenue coming into the OASI and DI trust funds, at what point would the OASI [Old Age and Survivors Insurance] and DI [Disability Insurance] trust fund asset reserves become depleted, and how would this affect the ability to pay scheduled OASI and DI benefits on a timely basis?” the senators wrote.
Goss responded, “If this hypothetical legislation were enacted, with no alternative source of revenue to replace the elimination of payroll taxes on earned income paid on January 1, 2021, and thereafter,” the Social Security Insurance Funds would run out of money by mid-2021 and mid-2023.
Schumer, a staunch critic of the president, called Trump’s payroll tax holiday and potential termination, “reckless.”
“This report confirms the devastating impact President Trump’s reckless Executive Order will have on Social Security. President Trump’s plan to eliminate Social Security’s dedicated funding would endanger seniors’ Social Security and could mean the end of Social Security as we know it by 2023,” said Schumer.
Trump announced his executive order suspending payroll tax for the duration of the CCP (Chinese Communist Party) virus pandemic in a speech on Aug. 8 in New Jersey. Trump also said, “If victorious on November 3rd, I plan to forgive these taxes and make permanent cuts to the payroll tax,” adding “I’m going to make them all permanent.”
In an effort to bolster the economy and reduce tax burdens on American workers amid the CCP virus pandemic, Trump signed the executive order to defer employee payroll taxes.
The White House did not immediately respond to the request for comment.