Ponzi Scheme for sure

Michael SainatoSun 6 Apr 2025 06.00 EDT

Office closures, staffing and service cuts, and policy changes at the Social Security Administration (SSA) have caused “complete, utter chaos” and are threatening to send the agency into a “death spiral”, according to workers at the agency.

The SSA operates the largest government program in the US, administering social insurance programs, including retirement, disability and survivor benefits.

An average of almost 69 million Americans per month will receive a social security benefit in 2025, totaling about $1.6trn in benefits paid during the year and accounting for 22% of the federal budget. While expensive and challenged by an ageing population, social security remains overwhelminglypopular with Americans. But the agency has been dubbed a “Ponzi scheme” by Elon Musk, the billionaire whose so-called “department of government efficiency” (Doge) is currently slashing its staff and budgets.

“They have these ‘concepts of plans’ that they’re hoping are sticking but in reality, are really hurting American people,” said a longtime SSA employee and military veteran who requested to remain anonymous for fear of retaliation. “No one knows what’s going on. They’re just coming up with ideas at the top of their head.”

The SSA website has crashed several times this month. Wired reported Doge staff want to migrate all social security data and rewrite code in months, which could cause system collapse and further outages.

The agency plans to eliminate the jobs of 7,000 workers at the agency through voluntary buyouts, resignations or firings, though the union representing SSA employees anticipate even more firings beyond cutting staff to 50,000 workers.

Acting commissioner Leland Dudek has acknowledged to staff that Doge are making the decisions at the agency. Musk, Donald Trump and others have claimed action is being taken to tackle widespread fraud at the agency.

Dudek was appointed acting commissioner after he reportedly secretly shared information with Doge staff. He has threatened to shut down the agency in response to a court order barring Doge from accessing the data.

“It’s just been a lot of craziness, a lot of foolishness. Until they get rid of Doge and the person in office right now, and the Republicans actually get a backbone and stand up for something for once in their lives, things are just going to be complete chaos. That’s really the best word to describe SSA right now, just complete, utter chaos,” the worker added. “They couldn’t understand the coding, so everything they said SSA was doing illegally, they weren’t. Common sense is something they lack. They don’t know what they’re doing.”

Rich Couture, a spokesman for the American Federation of Government Employees’ Social Security Administration general committee, the union representing roughly 42,000 social security workers, said Doge’s public targets for cuts make no sense.

Why are they cutting 7,000 jobs, asked Couture. “It has never been explained with any degree of clarity how they came up with that figure. What’s being served by that by a loss of 7,000 jobs? How does any of that supposedly makes this operation more efficient? How does it improves service? How does it improves productivity? Our position is that losing 7,000 people doesn’t do any of those things,” he said.

“I don’t think they’re going to stop at 7,000 people lost. If they lose 10,000 or 12,000, they’re running up their high score. They’re able to brag about it.”

Departments at the agency have been closed and reorganized, with workers forced to take reassignments or risk firings, and all workers have been ordered to return to the office five days a week.

Couture noted the return to office order occurred a day before a buyout offer was set to expire, in violation of union contract agreements, and the offices were not prepared or equipped to handle it, as many workers had no desks or equipment to work.

Phone services for the public have also been cut, and field and regional offices are slated for closure around the US.

“There is no safe office in this country,” added Couture. “It’s a concerted attack on the legitimacy of social security itself. The promise that this country has made to the public with respect to income security is being broken.”

The cuts come as staffing is already at a 50-year low despite the agency serving a record number of recipients as the US population above the age of 65 is growing.

The office of the inspector general at SSA reported in August 2024 that a record backlog of payment actions impacting social security beneficiaries was due to lack of staffing, increased workloads, and decreased funding for the agency, driving improper payments because staff weren’t available to update records.

Couture noted the operating overhead of the agency, as a share of benefits paid out, has shrunk by 20% over the last ten years and is now less than 1%. He disputed any claims of inefficiency or waste at the agency, claiming the agency is already a model of efficiency and as effective as possible under its fiscal and staffing constraints.

He said he was concerned the situation was creating a “negative feedback loop” where, as more employees leave, more work is put on those remaining, depressing morale and inducing more to leave “until the agency ends up in a death spiral with staffing, inducing office closures”.