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It’s Time to Talk About Social Security. No More Waiting.

Social Security has always seemed like a future problem, with experts long predicting a benefits squeeze in the decades ahead. But the coronavirus has put tens of millions of Americans out of work, and economists are predicting that the recovery will take years.

That means the future is now.

If nothing is done to shore up the program, all benefit checks would need to be cut by roughly one-quarter in perhaps 11 years — or, if the recession is protracted and severe, maybe even sooner.

“We thought we had more than a decade, and now it could be less than a decade,” said Kathleen Romig, a senior policy analyst at the Center on Budget and Policy Priorities. “That makes a big difference both psychologically and in policy terms.”

The pandemic has hastened the cash crunch’s arrival by wiping out jobs and the payroll taxes — Social Security’s dedicated source of revenue — that they provide. Fewer people are paying into the retirement trust fund, and the longer they’re out of work, the deeper the problem becomes. (Even more pressing may be a fix for Social Security’s disability program, which has a trust fund of its own. A report issued by the Congressional Budget Office last month projects that fund could be exhausted in 2026.)

Despite such grim projections, Social Security hasn’t received a lot of attention during the presidential campaign, given everything else going on. But whoever wins next week will have little choice but to stretch out his hand toward the third rail of politics. And both candidates have offered ideas that could significantly shift how Social Security works.

President Trump hasn’t released a proposal, but he has said he wants to eliminate the payroll tax — Social Security’s lifeblood — as an expansion of the temporary holiday enacted by executive action over the summer. (Few companies have stopped collecting the tax, which would have to be repaid in 2021.)

“At the end of the year, on the assumption that I win, I’m going to terminate the payroll tax,” he said in August. Instead, he said, he would pay for the program through the general budget, which could count on “tremendous growth.”

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Mr. Trump has stated this on more than one occasion, but Sarah Matthews, deputy White House press secretary, said the president meant only that he wants to forgive the taxes deferred under his order.

“President Trump will always protect Social Security, as he has stated numerous times,” she said.

Policy experts are highly skeptical that the payroll tax could be eliminated; it would require congressional action and be politically difficult. But if it happened, Social Security would have to compete for funding in a way it hasn’t before.

“We have a very crowded budget as it is,” said Shai Akabas, economic policy director at the Bipartisan Policy Center. “And having Social Security in the mix with everything else puts the program at risk in the future.”

Joseph R. Biden Jr., the Democratic nominee, has released a proposal that’s more moderate than many offered by his party’s progressive wing. But it would nonetheless make fundamental changes.

Mr. Biden proposes an expansion of the payroll tax, but only on the highest earning Americans. Currently, the payroll tax — 12.4 percent, split between employees and employers — applies to the first $137,700 of a worker’s earnings. Under Mr. Biden’s plan, high earners would also have the tax assessed on their earnings above $400,000. (Because the $137,700 threshold rises over time, eventually all income up to $400,000 would be subject to the tax — in about 30 years, the Urban Institute estimated.)

For decades, the amount a worker pays into the system has factored into how much they ultimately receive in benefits. But Mr. Biden has suggested that higher earners might not get anything in return for the added tax they pay, a change that would break a link that has been in place since the program began. The issue is still being studied, however, and no decision has been reached.

“A key principle of social insurance in general — and the Social Security program in particular — is that contributions are linked to benefit calculations,” said William Arnone, chief executive office of the National Academy of Social Insurance, a nonpartisan group of social insurance experts.

Even with the tax on high earners, Mr. Biden’s proposal would buy the program only an additional five years of solvency, according to the Urban Institute analysis, though it would soften the benefit cuts that would be necessary if further changes aren’t made.

Mr. Biden’s policy advisers, however, said the proposal is something of an opening bid. “The vice president’s financing proposal shows how he would protect and increase benefits for all Social Security recipients while making a down-payment on long-term solvency,” said Gene Sperling, an outside adviser to Mr. Biden and a former national economic adviser to Presidents Bill Clinton and Barack Obama.

Just about every American has something at stake, or someone close to them who does: Roughly 178 million workers contribute to the program, and, this year, an estimated 45.8 million retirees will receive nearly $70 billion in benefits — the average monthly check is about $1,500 per month, according to the Social Security Administration.

Under current law, retirement benefits can only come out of the trust fund, which will be depleted by 2034, according to Social Security Administration estimates that do not take the pandemic into account. At that point, taxes collected will be enough to pay only 76 percent of benefits. (A Congressional Budget Office report from September predicted the trust funds would run out in 2031, others, including the Bipartisan Policy Center, project it could be sooner.)

The cost of inaction is serious, Mr. Akabas said, because as insolvency creeps closer, the changes necessary will become increasingly painful — tax increases will need to be greater, any cuts more severe. “The longer we wait to fix the problem,” he said, “the fewer people who can play a role in the solution.”

About half the population 65 and older live in households that receive at least half of their income from Social Security, according to a 2017 study published in the Social Security Bulletin. Roughly 25 percent of elderly households rely on Social Security for at least 90 percent of their income.

Joyce Welch, a 73-year-old retiree in Sacramento, subsists on Social Security alone. A single mother who raised two sons, she worked full time for most of her life. But her health started to decline roughly 15 years ago because of an undiagnosed autoimmune disease, and within a couple of years, she had to retire from her job as a site supervisor and family consultant at a caregiver support center in Los Angeles.

She paid $800 a month to extend her health insurance through COBRA, which she funded with retirement savings that quickly dwindled because of early withdrawal penalties. She eventually applied for Social Security Disability, and moved in with her youngest son.

“I lost my home, my life savings, and my independence,” she said.

Her Social Security retirement check of $1,370 is deposited on the third of each month and she shops for the month at Costco and a local food co-op. By the 15th — after paying for her share of rent and other expenses — she has just a few dollars left.

Without the program, she’d have nothing. “What happened to me,” she added, “is not unique.”

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Trump’s Payroll Tax Holiday Order Gives Employers a New Dilemma

The White House has pitched its payroll tax holiday as a boon to American workers that would fatten their paychecks and provide a jolt to the economy. But for companies large and small, the presidential intervention poses difficult legal and logistical questions that only add to the uncertainty that executives and workers are contending with during the pandemic.

Since Mr. Trump, in an order he signed on Saturday, is only suspending the tax, not cutting it, the money that companies would cease to withhold from their employees’ earnings would have to be paid next year, barring legislative action. For companies, this would require some complex accounting maneuvering. For employees, it could mean an unwanted tax bill in 2021, making the break more of a headache.

“This is not a holiday, because there’s a bill at the other end of it,” said Isaac Boltansky, an analyst with the research firm Compass Point.

The Treasury Department is expected to release guidance about how the payroll tax suspension will work. Thus far, businesses have been cool to the idea.

“I would rather just keep paying the payroll tax as it is now and deducting from the employees,” said Arnold Kamler, the chief executive of the bicycle company Kent International. “If it does go into effect, we’ll be very upfront with the workers and tell them: ‘Don’t spend it. Just put it away.’”

The U.S. Chamber of Commerce said in a terse statement on Saturday that Mr. Trump’s executive actions, though “well intentioned,” were “no substitute for congressional action.”

The National Retail Federation has told members to be ready for additional guidance about the policy, said David French, the group’s senior vice president of government relations. “Clearly there are a lot of unresolved issues with it,” Mr. French said on Monday.

The federal government imposes a 15.3 percent payroll tax on wages, which is split evenly between employees and employers. The tax supports Social Security and Medicare. If every business in the United States deferred the Social Security payroll taxes that they withhold for their workers to the end of the year, up to $40 billion a month would be added to the paychecks of Americans, JPMorgan Chase said in a research note on Monday.

But it is far from certain that many companies or workers will take the White House up on this offer, which experts said would be logistically difficult for the Treasury Department to force on them.

“Since employees must still pay those taxes next year, this order is really an offer of a zero-interest loan rather than an actual reduction in tax liability,” said Michael Feroli, economist at J.P. Morgan. “It remains quite unclear whether employers will actually change withholding schedules, particularly if it could lead to financial uncertainties in 2021.”

Because questions about the constitutionality of the policy persist, businesses are likely to hold off any decisions at least until the government provides additional guidance. On Monday, several large corporations declined to say what they would do, because they wanted the Trump administration to provide more details first.

“We’re awaiting guidance from the U.S. Treasury Department on the payroll tax deferral, and we’ll make decisions on implementation once that’s been provided,” said Randy Hargrove, a spokesman for Walmart, the country’s largest private employer, with 1.5 million workers.

One option some employers might consider is to withhold the tax and repay workers later if it is eventually forgiven. But that would defeat the purpose of stimulating the economy now, when it could use the help.

If businesses are reluctant to reduce withholding because they may be liable to pay the tax later, they “might escrow the withheld amounts rather than pay the Treasury, and assure their employees that if the payroll tax liability is eventually forgiven by an act of Congress, the business would cut the appropriate check to their employees,” said Itai Grinberg, an international tax policy professor at Georgetown University Law Center.

Payroll experts said many businesses would be hesitant to do anything until they had assurances from Congress that they and their employees wouldn’t have to make good on the deferred taxes next year.

“It’s a little bit of a risk that Congress may not act, and if you’re deferring a significant amount of taxes the reality is, a few months later, you’re going to have to come up with that cash and pay those taxes,” said Pete Isberg, vice president of government relations for ADP, a payroll specialist that serves more than 800,000 businesses.

The rollout itself may be expensive and time consuming for businesses. The payroll tax rate does not usually change in the middle of the year, Mr. Isberg said, and the shift would require businesses to reprogram computer systems that can be balky.

“Things of this magnitude normally take six months or so for orderly programming,” Mr. Isberg said. “So there will be some employers that just never get this done just from a technical perspective if they have systems that are old or difficult to maintain.”

In addition, by focusing on people who are employed, the measure fails to address the needs of the roughly 16 million Americans without jobs, some of whom are on the verge of losing their homes and cars.

“I don’t think it helps the economy,” Mr. Boltansky said. “I think that it’s a headline benefit for the Trump administration.”

Some groups, like AARP, contend that Mr. Trump’s order could scare older Americans who rely on Social Security and Medicare into thinking that lawmakers will reduce or alter their benefits to make up for the forgone tax revenue. That, in turn, could affect how those people spend and save money now.

“Social Security is more crucial than ever as Americans face the one-two punch of the coronavirus’s health and economic consequences,” AARP said in a statement on Saturday. “But this approach exacerbates people’s already-heightened fears and concerns about their financial and retirement security.”

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Economic Prescription for Coronavirus: ‘You’ve Got to Go Fast’

The government can’t prevent the coronavirus from damaging the U.S. economy.The usual tools that economic policymakers rely on, like tax cuts and stimulus spending, won’t restore canceled conferences, unclog supply chains or persuade wary consumers to go out to bars and restaurants. Even if such policies …

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