Mega-billionaire and DOGE chief Elon Musk told Joe Rogan last week that he believes Social Security is “the biggest Ponzi scheme of all time” and suggested the program is wracked by fraud. That’s ironic coming from a plutocrat who is peddling false “savings” to provide cover for his project to hobble the federal government.
It was also ironic because Social Security is a highly functioning, universal and exceptionally efficient part of the American social safety net. It’s the opposite of a Ponzi scheme. Which is why the overwhelming majority of Americans oppose cutting it.
The only people in American politics who are likely to pull the rug out from under retirees is today’s Republican Party.
In a Ponzi scheme a scam artist lures investors into a fake investment project, pockets a lot of the cash and uses new “investors” to funnel cash to the older ones — until new recruits slow down and the whole thing collapses. Everyone is being lied to, and nobody is really getting returns on their investment.
Social Security, which has been around since the 1930s, is politically toxic to touch precisely because it does pay everybody out. It is not some kind of black box in which money sloshes around mysteriously but a simple “pay as you go” program, wherein current workers, via the payroll tax, fund payouts for retirees and disabled people. In 2024, about 1 in 5 U.S. residents received Social Security.
As the Social Security Administration explains, “In 2025, when you work, about 85 cents of every Social Security tax dollar you pay goes to a trust fund. This fund pays monthly benefits to current retirees and their families and to surviving spouses and children of workers who have died. About 15 cents goes to a trust fund that pays benefits to people with disabilities and their families.”
And as the Center on Budget Policy and Priorities notes, in part because Social Security is universal and isn’t means-tested, it’s extremely cost-effective: Managing the program costs less than 1% of the revenue that funds the program.
Social Security isn’t unreliable — almost all retired Americans pay into it and draw from it. And, as the CBPP explains, Social Security is “most workers’ only source of guaranteed retirement income that is not subject to investment risk or financial market fluctuations.” Musk’s argument that Social Security is some kind of scheme to defraud the public rests in part on misinformation about dead people getting payouts. In the interview, Musk repeated a claim about tens of millions of people incorrectly being marked as “alive” in the Social Security database. But experts have debunked this claim by explaining that Musk has conflated Social Security number figures with actual beneficiaries and said there’s no evidence of widespread fraud. The SSA’s inspector general found in 2024 that only 0.84% of the trillions of dollars disbursed from 2015 to 2022 were improperly allocated. Most of those improper payments were overpayments, and some of them were recovered. The other thing Musk cites as evidence that Social Security is a scheme are the numbers that show Social Security obligations exceed projected tax revenue. That’s true and universally acknowledged — and not remotely scandalous. With people living longer lives and the birth rate decreasing, there will need to be a change to Social Security funding in order to keep the program working at the level it currently works at. There are a number of strategies for dealing with this that have to do with changing the way taxes fund Social Security. The only people in American politics who are likely to pull the rug out from under retirees is today’s Republican Party. Musk’s misinformation about Social Security, his and President Donald Trump’s constant claims that it needs to be probed for a nonexistent mass waste and fraud problems and massive cuts to the Social Security Administration’s workforce are themselves the red flags that should have American taxpayers who’ve paid into the system worried about being taken for a ride.
Zeeshan Aleem is a writer and editor for MS NOW. 
