Trump, Social Security and the future of retirement in America

Diane Rehm: On My Mind

WAMU 88.5

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🗓️ 5 December 2024

⏱️ 46 minutes

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Summary

For years experts have warned about a looming crisis facing the Social Security system. According to current estimates, the program will become insolvent by 2034, at which time benefits would be automatically cut.

During the campaign, President-elect Trump positioned himself as an advocate of the program, which remains highly popular among voters. But economist Teresa Ghilarducci says that if you dig into his proposals, a different picture emerges.

A recent analysis shows his policies would move up the date of insolvency from 11 years to 9 years. “It’s kind of a shocker,” she says. “He’s very bold in his policies.”

Teresa Ghilarducci is a professor of economics at The New School and author of the new book "Work, Retire, Repeat: The Uncertainty of Retirement in the New Economy.” She joins Diane to explain the urgency of addressing Social Security’s finances and why Trump’s proposals would make the situation worse.

Transcript

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0:00.0	Hi, it's Diane, on my mind, Social Security and Donald Trump.
0:10.8	For years, experts have warned about a looming crisis facing the system.
0:17.6	According to current estimates, the program will become insolvent by 2034, and benefits would be automatically cut.
0:28.7	In response, the GOP has called for raising the retirement age and preemptively reducing payments. But during the campaign, President
0:41.4	elect Trump vowed not to touch the program. I think what they're doing is running out the
0:48.6	clock. All they have to do is sit back, hold the ball, and let Social Security cut itself.
0:56.1	Teresa Gilarducci is a professor of economics and author of work, retire, repeat. She joined me
1:05.6	to explain the urgency of addressing Social Security's finances and why Trump's proposals would make the
1:14.9	situation worse. Teresa, if you would remind us what the central problems with Social Security
1:25.7	are now. Social Security is fine right now.
1:30.3	It is paying out benefits by the third of the month.
1:34.3	Most people are getting their Social Security checks deposited in their accounts,
1:40.3	and it's the only source of retirement income that's reliably indexed to inflation.
1:48.3	Social Security is keeping tens of millions of people out of poverty.
1:53.8	And many of those people are children.
1:56.3	They're children of disabled parents.
2:00.7	Are their children of deceased parents.
2:03.6	So Social Security right now really doesn't have a problem.
2:08.6	So what is the funding crisis lying ahead?
2:12.6	The funding crisis is that if we look forward and estimate how much revenue will go into
2:21.8	Social Security because workers and employers fund the system, it's through FICA.
2:29.0	Everybody's seen that on their paycheck and wondered like, who's FICA and why are they taking
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