Since the old saying goes that the only things certain in life are death and taxes, hopeful logic would dictate that an incoming administration wouldn’t dare touch Social Security or Medicare.
However, Forbes.com contributor John Wasik warns savvy retirees to keep a sharp eye on the developments under President Donald Trump and the Republican-led Congress.
Please remember, actual mileage may vary between heated campaign rhetoric and the actual reality of dollars, facts and figures for Trump once he sits behind the Oval Office desk.
However, Forbes.com noted some possibly unsettling omens:
“There are some glaring conflicts between what Trump has said in the campaign and retirement policy going forward. Trump, for example, has said he wouldn’t cut Social Security and Medicare, although Speaker of the House Paul Ryan has long pushed for privatizing both programs. That may ultimately cut benefits,” Forbes.com reported.
“We’re not going to hurt the people who have been paying into Social Security their whole life,” Trump has declared, calling the payment of promised benefits “honoring a deal.”
But the man heading the Trump transition team’s Social Security effort Michael Korbey, a former lobbyist who has spent much of his career advocating for cutting and privatizing the program, according to Yahoo News.
Meanwhile, Ryan, who represents mainstream Republicans, has long advocated privatizing Medicare. But Ryan has never released specific details.
In addition to handing over Medicare to the private insurance industry, Ryan would raise the qualifying age for Medicare to 67 (from 65 at present) in three years and require that higher-income Americans pay more for insurance.
Increasing economic growth by 4 percent and eliminating fraud have been the linchpins to Trump's platform for fixing Social Security and entitlements. But even if he could accomplish both, Trump's plan to save Social Security would fall well short, according to CNN.
Even if a 4 percent growth were possible — most economists call it unrealistic — it would delay but not fix the long-term problems of Social Security.
CNN reported that 2034 is the year when there won't be enough in Social Security to pay full benefits; retirees would get just 79 percent of what's owed to them.
The second half of Trump's plan — eliminating fraud — would account for $5 billion, just 3 percent of the shortfall.
Experts agree there are only two ways to fix Social Security — alter the plan itself or leave entitlements alone but execute hundreds of billions in budget cuts and/or tax increases immediately.
Altering the plan could entail increasing the payroll tax from 6.2 percent to 7.6 percent, increasing the retirement age, or cutting benefits, U.S. News reported.
For their part, those in the Trump camp caution that you can't always trust what academics say or write.
Newsmax Finance Insider and Trump adviser Stephen Moore seeks to prove that point by reminding us:
"The Democrats and their gang of pundits assure us that 4 percent growth cannot and will not happen under President-elect Trump. But let's not forget: These are the same geniuses who have assured us for the last year that there would never be a President Trump. Wrong again," Moore wrote for Newsmax Finance.
"Trump will also bring an America-first, pro-business approach to economic policy. Having someone in the White House who knows how to run a business and meet a payroll has to be a psychological lift for this battered and bruised economy."
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