Social Security Trust Funds Would Be on Stronger Footing If Not for Trump Economic, Immigration Policies

The 2025 Social Security trustees’ report projects that the Social Security Old-Age, Survivors, and Disability trust fund reserves will be depleted in 2034, one year earlier than last year’s report. This is the closest the trust funds have come to reserve depletion since the early 1980s.

However, the report reflects the world before Trump took office, since its assumptions were set last December. Since then, the Trump Administration imposed widespread tariffs across many countries and on several vital goods like steel, aluminum, and automobiles. Even more concerning is the Administration’s draconian mass deportation policy. Beyond the devastating consequences of the mass deportation program, it is also chilling in-migration. These immigration actions may lead to net negative inflows of migration for the first time in 50 years.

Trump’s tariffs and mass deportation program will accelerate the depletion of the trust fund and risk cuts to Social Security benefits — something the President has promised not to do. If policymakers fail to act, benefits will be cut by nearly a quarter across the board. With Social Security’s reserve depletion date less than a decade away, policymakers should not dig the hole in the system’s financing any deeper.

The Trump Administration’s actions are weakening the country’s economic outlook and Social Security’s financial footing.

• Trump’s tariffs will raise prices, costing Social Security. The Trump Administration has engaged in a chaotic and haphazard tariff scheme since taking office, placing tariffs on over 70 countries and on specific products. The tariff rate has not been consistent, fluctuating on a sometimes weekly basis. Tariffs increase the prices of a wide range of imported goods, including products that the United States does not, nor cannot, produce in large quantities, such as bananas.

  A wide array of analysts including the Congressional Budget Office, the Budget Lab at Yale, and Goldman Sachs project that sweeping tariffs will result in price increases that families would experience as a one-time burst of inflation and then permanently higher prices for goods. There is already evidence that they are leading to higher prices. Higher inflation leads to higher Social Security cost-of-living adjustments (COLAs), which increase the program’s costs and reduce trust fund solvency. And if they end up slowing the economy, that will also reduce trust fund solvency.

• The uncertain economic environment caused by the tariff scheme also weakens Social Security’s outlook. With the Trump Administration’s haphazard announcements on tariffs, businesses do not know whether tariffs will be imposed for a brief period, if there will be exemptions, or whether the tariff rates will stay constant. 

  Many economists have expressed concern that the risk of higher unemployment and economic contraction has risen significantly because of the tariff chaos — possibly leading to a recession. Lower labor force participation and earnings would lead to lower Social Security revenues, reducing trust fund solvency. 

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• By reducing immigration and deporting immigrants, the Trump Administration is further hurting Social Security’s finances. Immigrant workers strengthen Social Security’s finances (see chart). Like all other workers, immigrants contribute to the trust fund through payroll taxes. Even if they themselves will not become eligible to receive benefits in their lifetimes, immigrants improve the solvency of a program that provides almost all workers with a foundation of income for their retirement.

  The Administration’s mass deportation program — including of people who have been living and working in the U.S. lawfully and whose status is being revoked — will not only have huge personal consequences for immigrants and their families, but will worsen Social Security’s finances, affecting all workers and beneficiaries. 

• The tax cuts in the “One Big Beautiful Bill” will reduce Social Security’s income. By raising the standard deduction for all filers, and raising it even higher for some seniors, fewer Social Security beneficiaries will pay taxes on their benefits, and those who do will pay lower rates. Raising the standard deduction would deliver little to no benefit to lower- and moderate-income families while reducing income into Social Security’s trust funds.

As mentioned, the trustees’ report does not include the effects of these policies, but one analysis estimated that the combined effect of all of Trump’s campaign promises —including those listed above — would move Social Security’s reserve depletion date up by three years, and increase Social Security’s ten-year cash shortfall by $2.3 trillion.

Trump’s actions and promised actions come on top of a Social Security shortfall created by a December 2024 law that repealed Social Security’s windfall elimination provision and government pension offset, increasing benefits for some public sector workers who had worked both in and outside Social Security-covered jobs. This bill cost the Social Security trust funds an estimated $200 billion over ten years, shaving an estimated six months off their reserves, and is reflected in today’s report.

With Social Security’s financial reckoning less than a decade away, policymakers should stop digging the hole deeper. In particular, the Trump Administration should pull back from its disastrous tariff and deportation schemes, and Congress should reject proposals to reduce Social Security’s income through additional tax cuts that do little to nothing for lower- and moderate-income families.