9/8/20
For reasons no one has been able to completely explain, a few months ago President Trump got it in his head that a temporary cut to the payroll tax would be a spectacular boost to the economy, despite the fact that almost no one in either party believed it was a particularly good idea. At every step since then, it’s been clear that it was a huge mistake that has displeased everyone. And now, it could turn into a genuine political liability if Joe Biden gets his way. Here’s the background. When it turned out that Congress had no interest in cutting the tax — which funds Social Security — Trump issued an executive order allowing businesses to temporarily defer the tax. But then both large businesses and small businesses mostly said, “Thanks, but no thanks” to Trump’s idea, because implementing it would create a bureaucratic hassle and then their employees would be on the hook to pay back the deferred taxes next year. When they figured out that few businesses were interested, the administration decided to force 1.3 million federal workers to take the deferral whether they wanted it or not, sparking outrage from employee unions and protests from Democrats. But far worse is something Trump said to calm fears about workers being stuck with a big tax bill in 2021. If he wins the election, Trump vowed, he will “terminate the payroll tax.” He added: “We’ll be paying into Social Security through the general fund.”
The thing about political campaigns is that if your opponent says, “I’m going to do this spectacularly unpopular and stupid thing,” you don’t have to ask, “Does he really mean that?” You can just attack him for what he said. Which is exactly what the Biden campaign is doing. The Biden ad assumes that Trump would eliminate the employee half of the payroll tax (it’s paid equally by employers and employees), which would indeed render the program unable to pay all its benefits in just a few years. I should say at this point that even if Trump is never going to do this, and even if Biden is being accurate in how he characterizes what Trump is proposing, this comes after years of conservative fear-mongering about the fate of Social Security, in particular the inaccurate idea that in a short time it will “go broke.” Back in 2016, Trump claimed he’d protect Social Security; it would be a stretch to say he meant anything by it beyond his general inclination to promise everything to everyone. But now he really is saying he’ll undermine this spectacularly successful and popular program in a dramatic way. Does he mean that either? Maybe not. But you can’t blame Biden for taking him at his word.
