Will Tax Cuts Lead to Reduced Entitlements?

Senator’s comments create concerns, as tax reform advances.

As tax reform moves forward, remarks by Sen. Marco Rubio have come to light that have many observers nervous, according to the Wills, Trusts & Estates Prof Blog in “Rubio: Offset Tax Cuts By Reducing Social Security, Medicare Benefits.”

The senator suggested that the tax cuts could be paid for eventually by cutting programs the elderly rely on, including Social Security and Medicare. He proposed to cut benefits for future generations,  since they would have plenty of time to prepare for the changes.

Republicans in both the House of Representatives and the Senate have passed a tax reform package.  However, there is still a ways to go before anything becomes law.

The differences between the bills passed by the two chambers are significant enough, that a final bill needs to be negotiated in committee and then both chambers of Congress will need to vote on it.

Both bills would add approximately $1.5 trillion to the national debt, causing many observers to wonder what happened to the GOP’s normal stance that the budget should be balanced.

One problem with that is Americans are already not saving enough for their retirements with current benefit amounts. It is not certain that changes to benefits would spur them to save more.

Reference: Wills, Trusts & Estates Prof Blog (Dec. 3, 2017) “Rubio: Offset Tax Cuts By Reducing Social Security, Medicare Benefits.”