Donald Trump came into office with a long list of priorities, but progress turning that long list into law has thus far been slow going. Here are five campaign promises that Trump made that he's either abandoned or is still working on that could be bad news for your budget.
1. Medicaid is off-limits
Trump has said that he isn't interested in cutting funding for Medicaid. However, the latest Obamacare repeal-and-replace plan in the Senate does exactly that. Specifically, it cuts Medicaid spending by shifting it to a block grant program and tying annual spending increases to the broadest measure of inflation, rather than healthcare inflation. According to the Congressional Budget Office, 15 million Americans could lose Medicaid coverage by 2026 if this proposal is signed into law by Trump.
2. Fully funding Social Security
While campaigning, Trump took a "third rail" approach to reducing Social Security benefits, yet his first budget takes aim at Social Security disability benefits, slashing them by $64 billion. These cuts could strike a big blow to seniors because most SSDI recipients are over age 55, and they've been deemed totally disabled and unable to work by the Social Security Administration.
3. Charging Mexico for the wall
Building a wall on the Mexican border was a cornerstone of Trump's campaign promises, and he assured Americans that Mexico would end up on the hook for its cost. Instead, Trump's asking Congress for $4.1 billion in his first budget, including $1.5 billion this year and $2.6 billion in fiscal year 2018. In the future, proposals to pay for the wall include a border adjustment tax that could increase the cost of goods made in Mexico and sold in the United States. According to the automobile industry, such a tax could cause the average cost of a new car to increase by $3,000.
4. Reducing the debt
The U.S. debt stands at $19.9 trillion and reducing debt "fairly quickly" was a Trump campaign promise. However, Trump's first budget does little to rein in debt, and it could cause debt to increase. Trump wants to spend $168 billion in federal funds on infrastructure as part of a $1 trillion infrastructure investment program, and he wants to boost defense spending by $54 billion. Cutting the budget elsewhere to offset that spending seems increasingly unlikely.
5. Cutting healthcare costs
Trump vowed to tackle health insurance premiums and drug prices if he won the White House, but efforts so far to reform healthcare could cost many Americans more, not less. For instance, the Senate's Better Care Reconciliation Act (BCRA) replaces Obamacare with a new system that Kaiser Family Foundation estimates will result in premiums doubling for Americans between age 55 to 64, unless they buy plans offering less coverage. The bill also allows insurers to charge older Americans up to five times what they charge younger Americans, up from three times today.
The Motley Fool has a disclosure policy.