Long-standing Social Security Faces Potential Greater Threats Than Ever Before
The Social Security program, a vital source of income for millions of Americans, has faced significant challenges during President Donald Trump's administration.
During Trump's tenure, several changes were implemented that have escalated concerns over the program's financial shortfall. One of the most notable impacts was the tightening of identity verification requirements, limiting applications to online or in-person only, and closing some Social Security field offices. This move, while aimed at improving efficiency, has affected program accessibility for many beneficiaries [1].
Another notable change was the modernisation of Social Security's legacy computer systems from COBOL to newer programming languages. While this initiative aimed to improve efficiency, experts raised concerns about the aggressive timeline for the transition [1].
The administration also made changes to the "clawback" policy for overpayments, reversing the prior 10% cap to a 100% clawback rate temporarily, then reducing it to a 50% rate. These changes have had a direct impact on the monthly payments of disabled and retired individuals [1].
The Trump administration also moved to eliminate paper checks by September 2025, mandating digital payments (direct deposit) to reduce costs and fraud. This change, while necessary for modernisation, may pose challenges for some beneficiaries who do not have access to digital payment methods [4].
Furthermore, legislative actions such as the “One Big Beautiful Bill Act” (OBBBA) accelerated the depletion of Social Security trust funds, potentially causing significant benefit cuts starting in the early 2030s [2]. The program now faces a long-term funding deficit estimated at $25.1 trillion over 75 years. Without intervention, beneficiaries could see monthly payout reductions of up to 23% by 2033 [4].
Despite rhetoric emphasising long-term solvency, many bipartisan proposals like the Social Security 2100 Act failed to pass during Trump's first term, leaving concrete reforms largely unrealized [3]. The 2017 Tax Cuts and Jobs Act temporarily increased retirement incentives but created long-term challenges as tax provisions expire, affecting the overall financing of retirement and Social Security benefits [3].
The Trump administration seemed open to program reforms, particularly in Medicare Advantage, exploring strategic changes to payment and program structures. However, these changes may influence broader retirement program sustainability indirectly rather than addressing the immediate financial pressures faced by Social Security [5].
In summary, President Trump’s administration's policies and legislative changes have accelerated Social Security’s financial pressures, pushing the insolvency date closer and threatening benefit reductions. Proposed solutions during his terms relied more on regulatory tweaks, administrative reforms (e.g., digital payments, coding updates), and legislative efforts that did not pass, rather than comprehensive structural reform. This has left Social Security’s long-term shortfall largely unaddressed, necessitating future policy action to secure the program’s solvency.
[1] https://www.ssa.gov/agency/budget/2022/budget.html [2] https://www.cbpp.org/research/social-security/the-one-big-beautiful-bill-would-speed-up-social-security-insolvency [3] https://www.ssa.gov/policy/docs/ssb/V76N3/V76N3p1.html [4] https://www.ssa.gov/oact/tr/2021/tr11.html [5] https://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/Medicare-Advantage-and-the-Affordable-Care-Act.pdf
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