Can you see Trump in this picture?
One of the executive orders President Trump signed on Saturday, Aug. 8, 2020, after Covid-19 relief negotiations broke down (because Republicans refused to budge) creates what CNN is calling a “payroll tax holiday” for people earning less than $100,000 a year.
In a nutshell, Trump authorized the Treasury Department to stop collecting Social Security and Medicare (FICA) taxes for the rest of this year. That doesn’t mean workers and employers don’t owe those taxes. Only Congress can write them off, and if it doesn’t, they’ll become tax debts.
As NBC News says, Trump’s order “defers rather than eliminates them, which means the government could choose to collect the money at a later date.” As CNBC points out, the Treasury Secretary can only delay tax deadlines for up to a year during federal disasters. That’s effectively what Trump’s order does. He doesn’t have greater authority than that.
In fact, when Trump signed this executive order, he explicitly promised to try to get Congress to do that next year, if he’s reelected. But Democrats oppose cutting the taxes that support Social Security and Medicare, so not only will require that Trump gets reelected, but also that Republicans hold on to the Senate and retake the House. That’s unlikely.
This isn’t a tax cut, and Trump’s executive order doesn’t require employers to stop withholding those taxes. Faced with a strong possibility of having to pay them later, it’s likely many won’t.
Trump has been pushing for a payroll tax cut since long before Covid-19 came along, and he has ulterior motives. Republicans have never liked Social Security or Medicare, and many of them wouldn’t mind gutting these programs by starving them of tax revenues. An effort by President George W. Bush and former House Speaker Paul Ryan to privatize them failed.
Helping ordinary Americans make it through the Covid-19 crisis has nothing to do with what Trump just did. As Democrats point out, a FICA tax holiday doesn’t help the unemployed. And, as is usual with Republican tax cuts, those who would benefit the most from it are high earners.
Don’t buy Trump’s snake oil. This “tax holiday” isn’t what it appears to be. It’s another attack on Social Security and Medicare that does nothing to help those most in need because of Covid-19.
Trump also signed an executive order he claims extends a moratorium on evictions. But as NBC News said, it doesn’t “actually prohibit any evictions; instead, it merely asks federal officials to ‘consider’ whether any measures are necessary to halt evictions for failure to pay rent. Trump’s remarks made the order sound far more sweeping than it really is.” For more about the looming eviction crisis, see this article.
Again, don’t be fooled. It’s smoke and mirrors.
Once again our Constitution works the way it is designed. Fortunately for Democrats Trump actually wants a bill on his desk. He will sign it. If the Senate will only pass a trillion dollar bill well do what the song says and take the money and run, as a trillion here and a trillion there does add up to some real money, and nothing well is just that nothing. Of course the liberal Democratic states could take action by taxing and spending. Not one of the Democratic proposals could not be done at the state level.