President Donald Trump pledged repeatedly on the campaign trail not to cut Medicare or Social Security benefits.
But something must be done – and soon – to address these entitlement programs' looming financial crisis.
According to Congressional Budget Office estimates released in 2015, Social Security's cash deficit is set to explode to $361 billion in 2025 from $74 billion in 2014.
The CBO's findings also pointed to the $2.8 trillion Social Security trust fund (which includes Medicare expense coverage) to begin its official depletion run late in 2029, after which its revenue will cover only about 75% of scheduled benefits until 2034.
These estimates, of course, pertain to Social Security and Medicare's fate should Uncle Sam take no further actions to thwart the programs' demise in the very near future.
And despite Donald Trump's reiterated vows not to cut SS benefits, his nomination for budget director – Rep. Mick Mulvaney (R-SC) – suggests he might do just that…
Trump's First Option for Social Security: Cut Benefits
In his Senate testimony last Tuesday (Jan. 25), Mulvaney stated he believes cuts to Social Security and Medicare are necessary in order to keep the programs solvent. His statement directly contradicted Trump's campaign pledges about entitlement programs.
"I have no reason to believe the president has changed his mind" on not touching entitlement programs, Mulvaney said, according to The Washington Post on Jan. 24. But, he added, "My job … is to be completely and brutally honest with him."
The South Carolina senator clarified his stance by stating his proposed cuts would not affect current recipients.
Mulvaney also suggested immediate "means-testing" for those applying for Medicare benefits to begin as early as this year.
Means-testing is a method used by the government to determine whether someone qualifies for a financial assistance program. Insofar as Medicare is concerned, Mulvaney's plan would make Medicare available to retirement-age individuals on a case-by-case basis – thereby stripping away the program's designated "entitlement" status.