Copyright Newsweek
President Donald Trump warned Tuesday that if the Democrats don't approve funding, there are dangers to the future of Social Security and Medicare. Trump said at a press conference that when he asked Democrats for feedback on the funding bills, one said, "It means death." "There's nothing about death," Trump said. "Theirs is death because they're going to lose Medicaid, they're going to lose Social Security, they're going to lose Medicare, all of those things are going to be gone because the whole country would be bankrupt, and you're not going to have any kind of medical insurance." Why It Matters A point of contention leading to the government shutdown is the Democrats' refusal to accept a funding bill that would cut health care provisions, which many Republicans argue fund medical care for illegal aliens. Social Security and Medicare represent vital support for tens of millions of Americans, especially retirees, seniors, and individuals with disabilities. As of late 2024, Social Security provided monthly benefits to about 53 million Americans—nearly 16 percent of the U.S. population. Medicare and Medicaid similarly underpin health insurance availability for seniors, low-income people, and many vulnerable groups. Any potential reduction or administrative change to these programs has far-reaching implications for millions who rely on them for basic income or health care needs. Federal funding gaps have become more frequent in the last 30 years, according to the Congressional Research Service, which added that the issues are often triggered by fights over budget policy and partisan spending demands. Donald Trump Issues Warning on Social Security, Medicare: What We Know Trump warned at the press conference that if an agreement is not reached with the Democrats, programs like Social Security, Medicaid, and Medicare will be in danger. There are currently no changes to Social Security, Medicare or Medicaid as the government shutdown, which just reached its third week, continues. The president added of Democrats, "We will not be extorted on this crazy part of this. They've never done this before. Nobody has. You always vote for an extension." White House spokesperson Abigail Jackson told Newsweek in a statement on Tuesday, “Democrats chose to shut down the government because they want to give free health care to illegal aliens. They can choose to reopen the government at any point by supporting the bipartisan CR they voted for just six months ago. The Trump Administration is working day and night to mitigate the pain Democrats are causing.” Can You Work and Collect Social Security? Americans can work and collect Social Security retirement benefits at the same time. However, if an individual has not reached their full retirement age, their benefits may be temporarily reduced if they earn more than the annual earnings limit established by the Social Security Administration. In 2025, these limits and corresponding reductions will reflect cost-of-living adjustments, as set by the SSA. Benefit reductions apply only before reaching full retirement age, after which there are no earnings limits. Is There No Tax On Social Security? Social Security income may be subject to federal income tax depending on an individual’s total income and filing status. If a beneficiary’s combined income, defined as adjusted gross income plus nontaxable interest and half of Social Security benefits, exceeds yearly set thresholds, up to 85 percent of benefits may be taxable. The Internal Revenue Service issues updated tables annually. What Is the Social Security Cap for 2025? The Social Security wage base cap determines the maximum amount of earnings subject to the Social Security payroll tax each year. For 2025, the wage base limit published by the Social Security Administration is $176,100. Earnings above the established limit are not subject to Social Security tax, although all covered earnings remain subject to Medicare tax. What People Are Saying Democratic strategist Doug Gordon told Newsweek: “No one ever ‘wins’ a shutdown. But it is certainly a bad look for Republicans that Speaker Johnson has the House of Representatives on a taxpayer-funded monthlong vacation while Americans are about to get hit with the largest health care cost increase in more than a decade.” GOP strategist Matt Klink told Newsweek Tuesday regarding the government shutdown: "This is a fight the GOP is comfortable having. The Democrats overplayed their hand by trying to jam through a major policy change on the back of a funding deadline.” What Happens Next It's unclear if and when Democrats and Republicans will reach a compromise and end the government shutdown.
