The Trump-Muskrat plot to kill Social Safety, Robert Reich
Sorry to intrude in your inbox for a second time at this time, however Elon Musk has revealed the reality about what he plans to do together with his so-called Division of Authorities Effectivity (DOGE): Intestine Social Safety and Medicare.
Musk retweeted a collection of posts by Utah’s Republican Senator Mike Lee, who dubbed Social Safety “deceptive” and known as for its dismantling. “Interesting thread,” Musk added.
On Thursday, Musk and his “DOGE” co-chair, Vivek Ramaswamy, went to Capitol Hill to debate their plans. Republican lawmakers instantly introduced that “everything is on the table,” together with slicing Social Safety and Medicare.
In the course of the marketing campaign, Musk stated his purpose was to chop $2 trillion — or about 30 p.c — of the complete federal price range.
There’s no method to do that with out slicing Social Safety, Medicare, and Medicaid. Social Safety alone accounts for nearly 1 / 4 of the whole federal price range.
Ramaswamy has been much more specific about their plan, saying in a CNBC interview that “there are hundreds of billions of dollars of savings to extract” from Social Safety, Medicare, and Medicaid.
Elon Musk spent $277 million of his fortune to elect Trump. He purchased the facility to intestine Social Safety and provides himself extra tax cuts and tens of billions in authorities contracts.
Simply to remind you: Neither Musk nor Ramaswamy was elected to his place. Which suggests they’re completely unaccountable. (Musk and Ramaswamy will work in live performance with budget-cutters within the Trump White Home, with the help of a congressional DOGE caucus that’s now forming.)
They’re each multi-billionaires who couldn’t care much less about Social Safety. In the meantime, you’ve most likely been paying into Social Safety your complete working life.
Republicans have been out to kill Social Safety since its founding in 1935 as a result of it’s probably the most in style and profitable authorities packages ever created. It doesn’t solely assist retirees. It additionally retains 26 million folks out of poverty.
Republicans have used public concern about Social Safety’s future solvency as a cynical excuse to demand cuts in advantages.
True, the trustees of Social Safety — of which yours actually was as soon as a member — say this system will have the ability to pay full advantages solely till 2033. After that, Social Safety will have the ability to dole out solely about 77 p.c of advantages.
However Social Safety might simply pay all the things it is going to owe to everybody for the subsequent 75 years if the cap on revenue topic to Social Safety taxes had been eradicated.
That cap is ready at $168,600 this yr (it rises with inflation). That signifies that anybody who earns greater than $168,600 this yr pays nothing in Social Safety taxes on the surplus.
Elon Musk completed paying his 2024 Social Safety taxes 14 seconds previous midnight on January 1 of 2024.
Even a run-of-the-mill CEO incomes $20 million per yr pays Social Safety taxes on lower than 1 p.c of their revenue.
In the meantime, a typical American employee pays Social Safety taxes on 100% of their revenue.
The Social Safety trustees anticipated the present increase in boomer retirements. That is why Social Safety was amended in 1983, to progressively enhance the age for gathering full retirement advantages from 65 to 67. That change helps finance the boomers’ retirement.
However the trustees did not anticipate that the majority People’ wages would stay stagnant and the way a lot of America’s complete revenue could be going to the highest.
A lot of the American working inhabitants at this time is incomes much less than the Social Safety trustees anticipated years in the past — lowering income flowing into this system.
Had the pay of American staff stored up with the development a long time in the past — in addition to their rising productiveness — their Social Safety funds would have helped hold this system flush.
On the similar time, a a lot bigger chunk of the nation’s complete revenue is now going to the highest in comparison with a long time in the past.
However revenue topic to the Social Safety payroll tax is capped. In order the wealthy have turn out to be far richer, an increasing number of of the nation’s complete revenue has escaped the Social Safety payroll tax.
The rise within the quantity of revenue above the cap attributable to inequality has price the Social Safety Belief Fund reserve an estimated $1.4 trillion since 1983.
The answer is apparent: Scrap the cap and make the wealthy pay extra in Social Safety taxes.
Bernie Sanders has provide you with a plan that may get rid of the cap on earnings over $250,000 and in addition topic funding revenue to Social Safety taxes. This is able to lengthen the solvency of Social Safety for the subsequent 75 years with out elevating taxes on 93 p.c of American households.
However Donald Trump, Elon Musk, Vivek Ramaswamy, and the opposite billionaires who’ll be working the administration beginning January 20 don’t wish to pay their justifiable share to maintain Social Safety going. They’d slightly kill Social Safety.
Buckle your seatbelts. That is prone to be one of many largest fights of the primary yr of the Trump administration. It’s additionally a obtrusive illustration of the distinction between the American folks and Trump’s wealthy and highly effective lackeys.
If we wish to guarantee Social Safety’s long-term future, and that working folks can retire with dignity, we should make the rich — together with the richest particular person on the earth— pay their justifiable share.
