While on the campaign trail, then presidential hopeful Donald J. Trump promised he would never make Medicare or Social Security cuts if elected.
“Save Medicare, Medicaid, and Social Security without cuts. Have to do it,” Trump stated at a rally on June 16, 2015, the day he announced his presidential bid.
“We’re going to save your Social Security without killing it like so many people want to do. And your Medicare,” Trump promised attendees at a July 2016 rally in Phoenix.
But just a little more than a month after winning the election, Trump nominated Rep. Mick Mulvaney (R-SC) as director of the U.S. Office of Management and Budget (OMB).
Liquidity moves markets!Click here to learn how you can follow the money.
The move raised eyebrows for those closely following Social Security and Medicare policy.
You see, Mulvaney is a staunch supporter of cuts to entitlement programs — especially Social Security and Medicare.
In fact, on Monday Mulvaney told the media he is devoted to changing Trump’s mind…
Mulvaney Promises “Brutal Honesty” to Sway Trump on Social Security Cuts
Mulvaney told conservative radio host Hugh Hewitt on Monday that he’s been trying “to socialize the discussion” about entitlement program reform around the White House, The Washington Post revealed that same day. Mulvaney said he’s been promoting such discussions in an effort to highlight how Social Security and Medicare are the federal government’s biggest fiscal problems.
And to that point, the new budget chief has a point…
Social Security and Medicare together accounted for 41% of federal expenditures in fiscal year 2015, according to SSA.gov’s summary of the 2016 annual reports released last June.
Social Security is, in particular, looking like it will run out of money by 2034. Over the program’s 82-year history, it had, by the end of 2015, collected roughly $19 trillion from taxes… but it had also paid out $16.1 trillion in benefits. This left a little more than $2.8 trillion in the program’s asset reserves – again, at the end of FY2015.
The Social Security Administration’s (SSA) trustees project an even direr outcome when it comes to Medicare…
According to the SSA’s June 2016 report, the Medicare Hospital Insurance (HI) Trust Fund will be depleted by 2028 – two years earlier than projected in FY 2014.
The SSA concludes its analysis with a plea from the agency’s trustees directly to U.S. legislators: “Address these financial challenges as soon as possible.”
That’s exactly what Mulvaney said he was doing amid his Senate confirmation hearing on Jan. 24 — he acknowledged he still favors raising the Social Security retirement age to 70, and supported means-testing to reduce Medicare spending.
Mulvaney also noted at that time that his key positions on spending and the national debt directly contradict what President Trump had promised while campaigning.
“I have no reason to believe the president has changed his mind” on not touching entitlement programs, Mulvaney said, according to The Washington Post that day. But, he added, “My job … is to be completely and brutally honest with him.”
And this past Monday, Mulvaney told radio host Hewitt that he thinks he will eventually succeed in getting his fellow politicians to fully realize the reformation steps necessary to keep both the Social Security and Medicare programs solvent.
“I think people are starting to grab it,” Mulvaney said, according to The Huffington Post‘s coverage of the on-air conversation that day. “There are ways that [legislators] can not only allow the president to keep his promise [not to cut benefits], but to help him keep his promise by fixing some of these [entitlement] programs.”
Unfortunately, Mulvaney’s version of Social Security reform may very well include future cuts, which is something Jared Bernstein told The LA Times on Feb. 1 to watch out for.
“Because [these entitlement] programs are so highly valued by recipients,” Bernstein, a fellow at the Center on Budget and Policy Priorities, wrote, “policy makers say ‘reform,’ ‘overhaul,’ ‘change,’ ‘revamp,’ and ‘fix’ the program. In the vast majority of these formulations, these verbs are euphemisms for cuts.”
We won’t know more about what intentions Mulvaney specifically has in mind – be they “cuts,” “overhaul,” or “changes” – for at least another week. He told Hewitt on Monday, “As soon as the 2018 spending budget is done at the end of next week, I’m hoping to put together something for the president to look at on the other pieces of entitlement spending, or mandatory spending.”
About Money Morning: Money Morning gives you access to a team of ten market experts with more than 250 years of combined investing experience – for free. Our experts – who have appeared on FOXBusiness, CNBC, NPR, and BloombergTV – deliver daily investing tips and stock picks, provide analysis with actions to take, and answer your biggest market questions. Our goal is to help our millions of e-newsletter subscribers and Moneymorning.com visitors become smarter, more confident investors.
Disclaimer: © 2017 Money Morning and Money Map Press. All Rights Reserved. Protected by copyright of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including the world wide web), of content from this webpage, in whole or in part, is strictly prohibited without the express written permission of Money Morning. 16 W. Madison St. Baltimore, MD, 21201.
The post Trump Will Make Social Security Cuts If This Appointee Gets His Way appeared first on Money Morning – We Make Investing Profitable.
Wall Street Examiner Disclosure:Lee Adler, The Wall Street Examiner reposts third party content with the permission of the publisher. I am a contractor for Money Map Press, publisher of Money Morning, Sure Money, and other information products. I curate posts here on the basis of whether they represent an interesting and logical point of view, that may or may not agree with my own views. Some of the content includes the original publisher's promotional messages. In some cases I receive promotional consideration on a contingent basis, when paid subscriptions result. The opinions expressed in these reposts are not those of the Wall Street Examiner or Lee Adler, unless authored by me, under my byline. No endorsement of third party content is either expressed or implied by posting the content. Do your own due diligence when considering the offerings of information providers.