Elon Musk Accused of Social Security 'Disinformation Campaign' - Newsweek

President Musk is taking aim at Social Security. 

The next Republican Congressional town halls, if they aren't too cowardly to hold any again, will make the California wildfires look like Boy Scout cookouts.

President Musk is taking aim at Social Security. 

He's so bizarre-- its hard to imagine what kind of weirdness he will come up next.

President Musk is taking aim at Social Security. 

He's so bizarre-- its hard to imagine what kind of weirdness he will come up next.

Just a guess-- but he may go for a "one-two punch"-- and advocate ending Medicare!

That's next.

20 republican senate seats up for election in 2026 ...

The tech billionaire said Social Security is "the biggest Ponzi scheme of all time" during a podcast with Joe Rogan last week.

That's a stupid thing to say.  Ask Rick Perry.

However it's not entirely inaccurate.

People love to spread this idea that SS is a Ponzi scheme, not because they genuinely think that, but because they conceptualize any government payment as fraud. It’s the “government spending” bogeyman. But SS doesn’t work like a Ponzi scheme, and it doesn’t work like welfare, either. 

But SS doesn’t work like a Ponzi scheme, and it doesn’t work like welfare, either. 

It kinda works exactly like a government authorized Ponzi scheme.  

Not really.

The Securities and Exchange Commission defines it like so:

A Ponzi scheme is an investment scam that involves the payment of purported returns to existing investors from funds contributed by new investors.

That is pretty much the basis upon which Social Security has always worked.  Moreover, Americans have been encouraged to believe they are "paying in" to a program.  They are given their own accounts with online access where they can see the annuity benefit to which they will be entitled, much like any other "investment".  Beneficiaries are led to believe they are receiving the money they paid in during their working lives plus interest earned.  None of which is actually true.

If any private company operates that way, everybody involved is going to jail for running a Ponzi Scheme.

Politicians describe it using this investment like terminology because it's more palatable than the accurate description... "it's a tax used to pay pensions to the elderly and disabled".   Americans have a long history of opposition to taxation, but don't mind pension plans, so the program is a much easier sell when described like a pension.  But it has always used revenue collected from new "investors" to pay benefits to the old ones.

Social Security is not an actual Ponzi Scheme because it's officially sanctioned by the US Govt, who can bail it out using the nearly unlimited taxing and borrowing power at its disposal.  It is simply a tax on working people to used to fund payments to the elderly and disabled.

It’s the “purported returns” part that you’re skipping over. Ponzi scams are fraudulent. They promise returns that don’t happen. Any terms described are fake. The people investing don’t get paid. If they did, it wouldn’t be a crime. SS terms are public and the system is monitored. People actually get paid. It’s not a great program, but it’s not fraudulent, either.

It’s the “purported returns” part that you’re skipping over.  Ponzi scams are fraudulent. They promise returns that don’t happen. Any terms described are fake. The people investing don’t get paid.

Sure.  Yes.  And as I said, SS is not an actual Ponzi scheme, because the US Govt can always make payments.

That said.... The fact remains that it operates on the same mechanism as Ponzi's original scheme.  

The questionable activity comes from politicians who describe the program incorrectly and mislead participants, either intentionally or through their own ignorance.  Any private investment group who misstated the nature of their program like that would face criminal charges.

If they did, it wouldn’t be a crime.

It's a crime in the private sector even if you make all the payments.

SS terms are public and the system is monitored. People actually get paid. It’s not a great program, but it’s not fraudulent, either.

I never said it was fraudulent and that is not my view.  Nor do I support it's cancellation or anything like that.

I do think we should be describing it accurately and not selling it as something resembling a pension or investment vehicle.

The problem here is the dishonest demonization of government programs. It plays into the populist paranoia of “the government is out to get me/steal my money/etc.”

There are many legitimate criticisms and reforms that could be aimed at SS, but Musk and Trump lie and label everything the government does as “waste, fraud, and abuse.” They then arbitrarily cut or destroy said program with no regard for the good it does.

The problem here is the dishonest demonization of government programs. It plays into the populist paranoia of “the government is out to get me/steal my money/etc.”

Fair. 

The other problem is the dishonest sanctification of government programs as though they sit on the high altar of American prosperity. 

We're in a situation right now where we can't find the spine to make absolutely undeniably necessary changes to Medicare and Social Security because we have tens of millions of senior citizens who have been told all their life they have "paid into the system" like it was a pension at GE, so they see any adjustment to the benefits as stealing their money. 

But they didn't "pay into" the system.  They paid a tax that went to beneficiaries at that time.  If they were paid out based on a legitimate actuarial value of what they paid in, the benefits would be a fraction of what they actually are.

There are many legitimate criticisms and reforms that could be aimed at SS, but Musk and Trump lie and label everything the government does as “waste, fraud, and abuse.” They then arbitrarily cut or destroy said program with no regard for the good it does.

Ok.  And for every one of those there is a Democrat defending some existing program without regard to effectiveness, efficiency or astronomic waste.

One of our most basic problems is that - verrrry broadly speaking - conservatives say "no" to everything and progressives will say "yes" to anything. The middle ground has evaporated.

One of our most basic problems is that - verrrry broadly speaking - conservatives say "no" to everything and progressives will say "yes" to anything. The middle ground has evaporated.

I don't disagree at all.

Historically, it has been the role of progressives/liberals/whatever to push for change and the role of conservatives to oppose it, creating a decent balance of controlled progress.

I think where we are today, as you say, is that the weight has moved to the extreme ends of the scale, so any change in balance creates an almost violent movement.

There are millions of people satisfied with the “Ponzi scheme” and from both sides of the aisle. A successful government program dammit let’s give it to Wall Street to rape and pillage, it’s the American way.

Correct!

Ponzi Schemes always fail, they must when they run out of new money. Whereas, if the full faith and credit of the United States government ever fails then money will be worthless and we are back to the barter system. This is literally first day Econ 101...

people seem to forget that republicans have tried to bankrupt SS in the past by looting it ...

Oboy! Wall street, now that IS a Ponzi scheme!

Oboy! Wall street, now that IS a Ponzi scheme!

I'm an active trader-- I trade 5 days a week.

Am I supposed to be surprised that you consider me to be some kind of a con artist?

From what I understand of SS is that employees and employers pay into the system. The government doesn't unless the employer is a gov't agency.

What should be done is raising the cap. I only learned about that a few years ago and it made me mad. Higher earners should be paying more.

Yep, I always maxed out and some years only paid into Social Security for half my income. Yet, I get maximum benefits which are considerably greater than you will get. You should be mad...

What should be done is raising the cap. I only learned about that a few years ago and it made me mad. Higher earners should be paying more.

Are you going to raise their benefits accordingly?  

Hell, no.

Hell, no.

Exactly.  

So this is just another one of those times where somebody else has money and you want it.

You just hit the nail on the head. The takers of society don’t want Billionaires to pay their fair share, what they really want is billionaires to pay their share because they can’t.

I don't want it.

You paint the picture of someone who does not do anything, who sits around and collects governmental largess because they can.

[✘] There are people who work extremely long and hard hours just to make ends meet. Those people deserve a bit of respite at the end of life just the same as you. Greedy, selfish bastards make it so those people can not ever take time off and enjoy themselves even for a little bit, even to come on this site and give you a piece of their mind.

I don't want it.

So you're not in favor of eliminating the contribution cap?

You paint the picture of someone who does not do anything, who sits around and collects governmental largess because they can. That is the backdrop to your whole existence on this site. But the picture is wrong, and your struggling to paint it so is your downfall.

[✘] There are people who work extremely long and hard hours just to make ends meet. Those people deserve a bit of respite at the end of life just the same as you.

Yes. And with a combination of a very small increase in payroll tax and realistic actuarial adjustments, Social Security will continue to provide its minimal level of financial support for many years to come.

Greedy, selfish bastards make it so those people can not ever take time off and enjoy themselves even for a little bit,

Utter, complete, nonsense, to the point of clicheic fantasy. The American economy is not a Harry Potter movie.

Nice try. I bet you will win the votes of some.

The American economy is not a Harry Potter movie.   

Tell that to Trump.

Yep, I always maxed out and some years only paid into Social Security for half my income. Yet, I get maximum benefits which are considerably greater than you will get. You should be mad...

Well not exactly. You only get more benefits compared to others commensurate with the difference between your income and payments into the system and theirs, up to the limit.  Your BENEFITS are also limited by the program limits .

Social Security's Old-Age, Survivors, and Disability Insurance (OASDI) program limits the amount of earnings subject to taxation for a given year. The same annual limit also applies when those earnings are used in a benefit computation. This limit changes each year with changes in the national  average wage index . We call this annual limit the contribution and benefit base. This amount is also commonly referred to as the taxable maximum. For earnings in 2025, this base is  $176,100 .

This limit has steadily risen each year over the years.  You do not get SSI benefits on income above the income limit, as it is common for those with income over the limit to have other means of retirement funding like pensions, etc. which of course they have also paid into over the years (unless they were government employees in parts of California whose agencies paid both the employer and employee half of the retirement contributions, and then invested those retirements funds unethically/poorly at tax-payer expense - don't get me started on that), in addition to the OASDI taxes.

Remember that raising the OASDI income limit will place more burden on employers as well since the employer pays half the tax.  Those payroll taxes are often one of a small businesses' largest expenses, aside from medical insurance and professional liability insurance.

The OASDI  tax rate  for wages paid in 2025 is set by statute at 6.2 percent for employees and employers, each. Thus, an individual with wages equal to or larger than $176,100 would contribute $10,918.20 to the OASDI program in 2025, and his or her employer would contribute the same amount. The OASDI tax rate for self-employment income in 2025 is 12.4 percent.

And that percentage has continued to rise as well, from 1% on the employee only in 1937 - 1949, to 6.2% on each the employee and employer today (total of 12.4%).

More evidence of regulations and adjustments which further proves that SS is not a Ponzi scheme.

More evidence of regulations and adjustments which further proves that SS is not a Ponzi scheme

Indeed.  It isn't perfect.  There might be some fraud and waste which could be cleaned up, but other than that, the system does what it was designed to do and leaves working families with at least some level of retirement income.  That was not the case before or during the Great Depression.

How do you feel about Trump's idea of not taxing SS income? I know that even now if SS is your ONLY source of income, then you don't even have to file a tax return.  But if you paid into the system all your life and have a very small pension or a bit of investment income, why should you need to be double taxed on your SS benefit?

How do you feel about Trump's idea of not taxing SS income?

Too many variables and unintended consequences.

Is the car paid off?

Is the home paid off?

Did the family save for retirement?

535 people have argued, compromised and tinkered with this for 90 years and we know it still needs more tinkering.

First there should be a higher tax rate with something tying it to the size of the workforce.

Then there should be no cap for the rich.

Removing the current income tax exacerbates the current inadequacies

but it should be tax free because in essence it's a return of premium.

However Congress has done the Texas 2 step by taxing middle class overachievers while excusing the uber rich and the poor.

I pay mine with no complaint because I can afford it.

Speaking of affordability, Blue Bell Ice Cream is up to $9.49 a gallon at Kroeger.

I'd better report that to the new head of the Department of Affordability, Chuck E Cheese.../s

[✘]

I advocate means testing on Social Security where benefits are taxed 100% of annual income OVER ONE MILLION DOLLARS!

Too many variables and unintended consequences.

No I don't believe so.  Every worker, lower to upper class already paid into the system.  Taxing the benefits again then in retirement most certainly hurts the lower and middle class much more than it does the upper classes.  You said it yourself, you happily pay taxes on SS benefits "because you can afford it". 

The lower and middle class, millions of them with few other sources of retirement income, cannot afford it regardless of the other variables in their lives.  So offering those folks some relief in my mind far better benefits them and not so much the rich or upper middle class whose benefits were limited by the program limits anyway and who typically have other sources of retirement income.  Many of those folks might see the taxes they pay on SS benefits as pocket change, while for most Americans it means being able to put food on the table given those crazy price increases you mentioned in the last several years. 

Removing the current income tax exacerbates the current inadequacies.

Not so sure about that.  Taxes on income end up in the general fund at the treasury and have no bearing on the solvency of the OASDI trust fund.  The only thing taxes on SS income exacerbates is people struggling to pay their bills in retirement.

And yet, Warren Buffett gets $5,108 per month and has been collecting the max for over twenty five years. Do the math and get back with us about Social Security being a Ponzi Scheme.

I advocate means testing on Social Security where benefits are taxed 100% of annually income OVER ONE MILLION DOLLARS!

OK, but maybe consider reducing the benefits to people in that category by the amount of what the income tax on the benefits would have been.  That way that money stays in the OASDI fund to help maintain its solvency rather than ending up in the general fund for politicians to squander on their pet projects and special interests?

Do the math and get back with us about Social Security being a Ponzi Scheme.

I NEVER made that claim so don't point that shit at me JBB.

And yet, Warren Buffett gets $5,108 per month and has been collecting the max for over twenty five years.

Both he and his employers also contributed the maximum into it as well for his entire working life.  Why should he not get back his share just like everyone else?  Not that it would matter to him in the least as $5,108 per month is pocket change to him.  So if you want to set it up so that people in his category get a 50% or 100% reduction in their benefits, so that those funds remain in the OASDI trust, that sounds fine to me and he probably wouldn't care either.  But don't just tax the benefits as income and see it get pissed away by Congress.

Explain it to senior citizens who paid into Social Security for thirty years and who collect only $1,093 per month, or full retirement benefits for minimum wage income SS recipients today...

Explain that to senior citizens who paid into Social Security for thirty years and who now collect $1,093 per month, the full retirement benefits for minimum wage income SS recipients today...

OK - They made less, so they were taxed much less (they provided a much lower contribution to the OASDI fund) so their benefit is less.  Clear?

The only thing taxes on SS income exacerbates is people struggling to pay their bills in retirement.

And removing the taxes takes several years off of the life expectancy of the program while adding to the debt.

President Trump's Plan to End Social Security Benefit Taxes Could Save the Average Senior Household $3,000 in Annual Taxes -- but There's a Downside, Too | The Motley Fool

On the other hand Covid removed enough people to extend the fund approximately several months.

How Social Security was impacted by excess COVID-19 deaths - Marketplace

Thank whoever that we aren't a socialist society where every one's benefits are the same after a life time of labor.

And removing the taxes takes several years off of the life expectancy of the program while adding to the debt.

Your linked article it says:

So as average incomes and Social Security benefits continue to rise, more and more seniors find themselves giving a share of their checks back to the IRS.

Since it is taxed as income it goes to the IRS, not back to the OASDI fund, so I was not clear how it takes several years off the life of the program. But upon further digging, apparently the income taxes paid on the first 50% of Social Security benefits are credited to the Social Security trust funds.  I did not know that.  Thanks for the info SP!

So we could play with that provision but only apply it to those who's income is over a certain threshold.  Maybe add another higher threshold above where 100% of the recipient's benefits are taxed and returned to the fund.  Maybe me, you, and JBB should see if we can get a job in the Social Security department if Trump doesn't wipe it out!

That way that money stays in the OASDI fund to help maintain its solvency rather than ending up in the general fund for politicians to squander on their pet projects and special interests?

Now you're talking.

IMO, anybody making more than $250K ( or a current Dollar equivalent) a year should not get social security, but they should pay in. Why? Because they can afford it? Partially, I was thinking of the increased solvency of the people who were the working poor might just find itself in their (>250K) pocketbooks again.... Makes as much, if not more, sense than trickle down.

Explain it to senior citizens who paid into Social Security for thirty years and who collect only $1,093 per month, or full retirement benefits for minimum wage income SS recipients today...

They didn't "pay into" social security.  That's a myth. 

They paid a tax that was used to provide benefits for other people.  Now they are the beneficiaries of taxes being paid by others.

IMO, anybody making more than $250K ( or a current Dollar equivalent) a year should not get social security

Honestly for people who live in expensive and otherwise high tax areas like California, $250k is too low to take away the SS benefits that they paid the maximum level into for their entire careers.  $250k/year does not go far here if you raise kids and contribute to their college funds, and pay the high income and property taxes and much higher than average gas and home/rent prices, etc. etc..  This is especially true for small business owners (C or S-Corp) who may get a nice paycheck but not much in the way of profit sharing or 401k socked away for the future, particularly those with employees to pay and provide benefits for.  Believe it or not that income can still be almost a paycheck to paycheck scenario here. 

I can see MAYBE using that as the first threshold for paying taxes on perhaps 50% on the SS benefit upon retirement.  Then maybe another tier for those who made over $500k or $1M/yr who need to pay income taxes on say 100% of their SS benefit.  Again, that is assuming that those taxes are then returned to the OASDI trust funds, and not simply to the general treasury fund.

They paid a tax that was used to provide benefits for other people.  Now they are the beneficiaries of taxes being paid by others.

Sure but both those who paid the taxes before and those paying them now are all contributing to the same OASDI trust funds.  Since those taxes are based on a percentage of one's income, the benefits will vary from lower to higher depending on the total taxes one contributed to the fund over the span of their working career.  The fund is replenished or maintained primarily by the ongoing payroll taxes paid and on returns on investments made with the fund dollars.  And at least up to now, also by part of the income taxes levied on the SS benefits of all but those at the very lower end of the income scale.  To the extent that one is provided a benefit commensurate with their contribution to the fund, it does not meet the definition of a Ponzi scheme.

Having said that, fraud and waste could put the trust fund in peril and perhaps it has at various points in the past.  Our leaders continue to tweak the system and add benefits beyond the initial design, all the while increasing the percentage of taxes levied and the retirement age, riding the edge of solvency as our population ages and retires in greater numbers.  THAT is the problem.  And the solutions are not that simple. But it isn't like the benefits we collect today are completely funded by other people, we have contributed all our lives too, and now we are getting it back in the form of benefits commensurate with our level of contribution.

Our leaders continue to tweak the system and add benefits beyond the initial design,

Well yeah.  We were, in fact, warned that we would be in real trouble if Congress ever figured out they could buy our votes with our own money.  They have.

THAT is the problem.

What you're describing here is part of the overall actuarial shift that has gradually taken place over the last 75 years or so.  We live much longer that we used to, but we're still eligible for Social Security and Medicare at the same age as our grandparents, and we have far fewer workers per beneficiary.

So the old numbers are no longer going to work.  

And the solutions are not that simple. 

They're not that complicated.  They're just unpopular.

The real solution is a combination of slightly increased payroll tax, slightly reduced benefits, and a slight increase in eligibility age.

The idea that we can magically solve this problem by taxing the rich just stubbornly ignores reality.  What we know for certain is that high earners are very good at minimizing their taxes, and have the flexibility to do so.  So that's all a bit like Wiley Coyote confidently declaring he'll eat well tonight because he's seen a roadrunner.  It's just never going to work.

To the extent that one is provided a benefit commensurate with their contribution to the fund, it does not meet the definition of a Ponzi scheme.

It's not a Ponzi scheme, but it runs on a Ponzi scheme engine.  If we don't want that engine to stop running, we're going to tune it up.

Well yeah.  We were, in fact, warned that we would be in real trouble if Congress ever figured out they could buy our votes with our own money.  They have.

No argument from me on that my friend, Congress or even a President.  One of the worst cases of that recently was Biden's, and his supporters in Congress, student loan forgiveness gambit.  Instead of going after the root of problems that previous legislative actions created, let's just pile the cost of debt forgiveness on other taxpayers who were not party to those debt agreements.  When politicians who were part of causing the problem then turn around and claim to be the only savior, with other people's money, to get votes, that does not sit well with me.  

They're not that complicated.  They're just unpopular.

I agree that might be a better way of describing it.

The real solution is a combination of slightly increased payroll tax, slightly reduced benefits, and a slight increase in eligibility age.

Which is of course what we have been doing for decades.  

Which is of course what we have been doing for decades.

And ultimately punishes who?...

The simplest solution would be for Congress to restore unilateral rights to bankruptcy.

Then it would be an avenue for some people to consider.

As it is, student loan debt is not dischargeable except in the most extreme cases.  Less than 1% manage to be so destitute that the courts provide some relief.

In related news, there are several lenders who are still pursuing student repayments, late fees and interest

against those who have been discharged in bankruptcy citing the Omnibus Act of 1984.  The Consumer Financial Protection Bureau sued those lenders as predatory.

That lawsuit was dropped last week under direction of the WH.

Between 1976 and 1984 there was a 5 year waiting period before student loans could be considered for bankruptcy .  Prior to 1976, debt was debt.

Biden bashing aside, there has been no stomach for fixing what no one actually voted for in 1984, the original " I guess we'll just have to read it all to see what's actually in it." Omnibus bill that someone changed before the vote.

Well I just did the bride's taxes and they took $1855.00 from her that she wants back, lol.

That would be all refund.

So I guess I am switching my position.

elon has a hook in the lip of the biggest sucker in the pond ...

He's head of DOGE then not head of DOGE then Trump in his speech says Musk is head of DOGE. 

Even though Republicans never put this imaginary department up in front of ALL elected officials who were elected by the American people allowing voters to see their reps pass a bill creating the "department".

First Musk as " head not head" of this imaginary "department" he "created".

Then he fires thousands and thousands of American workers only to openly admit "OOPS" my bad.

PLEASE COME BACK TO WORK necessary Nuclear workers, PLEASE COME TO WORK necessary Disease Outbreak workers, PLEASE COME BACK TO WORK necessary Air Traffic Controllers, and the list goes on.

How much is all this chaos $$$$$ COSTING the American people???

Every employer knows one of the biggest costs is hiring employees if they quit. It's expensive to hire and retain workers so they don't unnecessarily fire good employees. 

Just because the Billionaire Boys Club is creating a newer more  expensive "SWAMP" while creating chaos and spreading lies doesn't  mean Americans shouldn't speak up about it.

Why keep any politicians if they fail to allow the American people a choice in this? Or are they already part of a new monarchy with Trump as king and Musk set to inherit the kingdom?

He's head of DOGE then not head of DOGE then Trump in his speech says Musk is head of DOGE. 

This will end up back in court.

Who is in charge of DOGE? Legally not Elon Musk : NPR

This will end up back in court.

... that's a crap shoot anymore.