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Trump's Social Security problem isn't his words, it's his math

By Brett Arends

Donald Trump's campaign is furiously denying that the former president plans to cut entitlements if he gets back into office, even though that's what he said on live TV - and, more to the point, it's the only way his budget math can possibly add up.

"The transcript of his answer...clearly states he did not say anything about cutting entitlements," campaign spokesman Steven Cheung told me in an email, talking about Trump's appearance earlier Monday on CNBC.

Coulda fooled me. "There is a lot you can do in terms of entitlements in terms of cutting and in terms of also the theft and the bad management of entitlements," Trump told conservative CNBC host Joe Kernen - according to the, er, transcript supplied by the broadcaster.

Still, who am I going to believe - the Trump campaign, or my own lying eyes?

But let's take the campaign at their word, and assume for the sake of argument that Trump wasn't talking about "cutting entitlements" - specifically Social Security, Medicare and Medicaid, as mentioned by Kernen - when he was talking about "cutting...entitlements."

But in that case, how is he planning to make his numbers add up?

After all, he is currently promising to cut taxes if elected for a second term. Just renewing the 2017 tax cuts, which are due to expire next year, would add about $4 trillion to the federal deficit through 2033, according to the number-crunchers at the centrist Committee for a Responsible Federal Budget. And that's not including any extra tax cuts Trump has been talking about.

The budget is already massively in deficit. The Congressional Budget Office is predicting the national debt will hit $48 trillion, a record 116% of gross domestic product, by 2034. That's before you add in any of Trump's planned tax cuts.

Then there's the small issue of the additional deficits within the entitlement programs themselves. Social Security has a $22 trillion funding hole. Without urgent action it is going to hit a fiscal cliff in 2033 and benefits would be cut by more than 20% across the board. Medicare's trust fund has a $4.4 trillion funding hole as well.

Nothing to see here, folks. Move along.

What are the options?

Social Security, Medicare, debt interest and defense will account for 70% of all planned federal spending over the next decade, according to Congressional Budget Office projections. Throw in Medicaid - much of it spent on seniors - and veterans and you're well over 80%. Something's gotta give. If you're not cutting any of those things, where exactly will the savings come from?

Trump's campaign says the former president is talking about cutting "waste."

How far does that get you? Not very, says Charles Blahous, an expert at George Mason University's Mercatus Center. You could find some efficiency gains in Medicaid, he says. But that's the smallest of the three programs for the federal budget. As for the big two?

"You can't fix Social Security simply by cutting waste and mismanagement," he told me. "It's an extraordinarily efficient program in terms of administrative costs." Medicare isn't quite as efficient, but "the Medicare cost growth problem is so huge you can't fix it by cutting waste alone," he added.

Still, I'm sure Donald Trump has a plan to make the numbers add up. As he did at, say, the Trump Taj Mahal, the Trump Plaza, the Trump Castle, the Plaza Hotel, Trump Hotels & Casino Resorts and Trump Entertainment Resorts. As the latest Wall Street filings related to Truth Social remind us, Trump ran them all - and they all ended up bankrupt.

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.


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03-12-24 0718ET

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