Trump’s Executive Orders a Political Game to Defund Social Security, Medicaid, and Disaster Relief

Credit: Gage Skidmore, Flickr Creative Commons

Local advocacy groups and national experts are sounding the alarm in response to recent executive orders signed by President Trump. On the surface, the executive orders appear to be an attempt to help ordinary Americans deal with the financial effects of the COVID-19 pandemic. However, local advocacy groups and national experts warn that not only are the orders not going to function as intended, but they also represent an attack on some of the nation’s most widely-used safety nets.

The Payroll Tax Deferment (not cut) – An Attack on Social Security and Medicare

Trump has instructed the U.S. Treasury to suspend the collection of payroll taxes beginning on September 1 for any worker earning less than $4,000 every two weeks. However, those taxes are merely being deferred and will come due at a later date – likely when the 2020 yearly taxes are filed. However, Trump has promised to forgive those taxes and make the payroll tax cuts permanent if he is re-elected in November.

Payroll taxes are what is used to fund both Social Security and Medicare. Currently, the Social Security Administration projects that the program will run out of money in 2035. However, more recent estimates that consider the effects of the pandemic project that the program could run dry as soon as 20208. According to Nancy Altman, president of Social Security Works, a national advocacy organization, Trump’s payroll tax cut could result in Social Security running out of money as soon as 2023 if the cuts are made permanent.

According to Patrick Chovanec, an adjunct professor at Columbia University and economic advisor at Silvercrest Asset Management, “a ‘payroll tax holiday’ would create a hole in funding Medicare and Social Security that Republicans would (normally) be reluctant to fill. Without Congress signing on, those taxes are just deferred a few months until a bigger bill comes due.”

So far, even Republicans aren’t enthusiastic about signing on to cut payroll taxes permanently.

“President Trump does not have the power to unilaterally rewrite the payroll tax law,” said Senator Ben Sasse (R-NE). “Under the Constitution, that power belongs to the American people acting through their members of Congress.”

“Our Constitution doesn’t authorize the president to act as king whenever Congress doesn’t legislate,” said Representative Justin Amash of Michigan. Amash is a conservative who was elected as a Republican who now identifies as an independent. “Just because Obama abused executive orders doesn’t mean Trump should. Just because Trump abuses executive orders doesn’t mean a future president should. It’s really that simple.”

In a joint statement, Senate Minority Leader Chuck Schumer and Speaker of the House Nancy Pelosi called the executive orders “unworkable, weak, and narrow policy announcements to slash the unemployment benefits that millions desperately need and endanger seniors’ Social Security and Medicare.”

$300 (not $400) Unemployment – A Tax On States that Leaves Millions of Workers Out and Steals Disaster Relief Funds

In a second executive order, Trump calls for federal unemployment aid to restart at a level of $400 per week. However, under the order, the federal government would only pay for $300 of that. The other $100 is to be paid by the states.

“The Trump administration does not have the authority to direct federal spending,” warns Step Up Louisiana Co-Director Ben Zucker. “We don’t want unemployed people thinking they are getting money they are not really getting any time soon. He is asking Louisiana to kick in 25% when Louisiana’s unemployment fund is about to run out of money in September.”

Based on a Department of Labor memo, states could count the first $100 they pay in weekly benefits to meet the $100 requirement – or use another method of funding. However, Trump has proposed using $44 billion from the Disaster Relief Fund – money typically used to help states recover in the wake of hurricanes, floods, and other natural disasters. This in the midst of a 2020 hurricane season predicted to be one of the busiest on record.

In Louisiana, nearly 200,000 workers receiving less than $100 in state unemployment benefits would be ineligible for the additional $300 provided under Trump’s executive order the New Orleans Workers Group pointed out in a press release. “Because of discrimination or bureaucratic snafus, millions never got the $600 supplement to unemployment or a stimulus check. Tens of millions just got kicked off the weekly $600,” the advocacy group notes. “Hunger, evictions, and foreclosures are mounting.”

“If the administration was sincere about helping families, they would have extended the $600 Federal Pandemic Unemployment Compensation before it expired at the end of July,” Zucker says. “President Trump is pandering for votes, not helping families.”

Help Keep Big Easy Magazine Alive

Hey guys!

Covid-19 is challenging the way we conduct business. As small businesses suffer economic losses, they aren’t able to spend money advertising.

Please donate today to help us sustain local independent journalism and allow us to continue to offer subscription-free coverage of progressive issues.

Thank you,
Scott Ploof
Big Easy Magazine

Share this Article

Leave a Reply

Your email address will not be published. Required fields are marked *