Penn Wharton Budget Model's Kent Smetters on Social Security Tax Cuts

Penn Wharton Budget Model Faculty Director and Wharton School Professor Kent Smetters joins Dan Loney to talk about Social Security. Penn Wharton Budget Model research estimates that eliminating taxes on Social Security benefits would reduce federal tax revenue by $1.5 trillion over 10 years and accelerate the Social Security trust fund depletion from 2034 to 2032. The policy would primarily benefit current retirees and higher-income individuals while leading to lower wages, reduced capital accumulation, and a 2% decrease in GDP over 30 years. Younger generations, particularly middle- and lower-income workers, would experience overall financial losses due to increased debt and economic slowdowns.

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