Billionaire Elon Musk, the engine of efficiency of the Ministry of Budget reduction by US President Donald Trump (DOGE), addressed the sensitive issue of social security cost savings on Fox Business television channel.
Musk told the host Larry Kudlow, a former Trump economic adviser, whom the government of the government of responsibility said in 2024 that the fraud of the federal government was “half a bill of dollars”.
While referring to waste, Musk said: “Most federal expenses are rights. So it’s like the big one to be eliminated. It is the kind of half-milliard, maybe $ 600, $ 700 billion a year.”
The use of the word “eliminate” in the same breath as “rights” trigger alarms among the democratic criticism of Trump and Musk. The white house’s press secretary Karoline Leavitt said during the March 11 information point that Musk was referring to the reduction of waste, fraud and abuse in these programs, and Trump “was going to protect Social Security”, Medicare and Medicaid.
During a March 11 event to promote Tesla cars at the White House, a journalist asked Musk if he could guarantee that there would be no interruption of social security services.
“We are going to be very careful with all the advantages,” said Musk. “In fact, it is only by approaching waste or fraud that we can really preserve these programs for the future.”
“Fraud” and “waste” mean different things. Waste refers to reckless use and fraud includes criminal reprehensible acts.
Musk referred to a report by the Government Accountability Office (GAO), a branch of non -partisan audit of the congress which examines federal expenses. In 2024, the Office estimated that there are $ 233 billion at $ 521 billion in fraudulent payments within the government per year.
The report went further than Social Security, Medicare and Medicaid, which represent about half of the compulsory public spending. It covers the whole government, including the rescue programs linked to the pandemic which led to record fraud.
Musk said that the reduction in fraud and waste will help their efforts to reduce $ 1 billion in the federal budget. But his fraud estimates are at the upper end of the Gao estimate or exceed. For Social Security, the Inspector General in 2021 noted around $ 300 million in payments after the death of the beneficiaries for about two decades – of which about a third was recovered. Although federal officials have long recognized inappropriate expenses as a problem, this is not the main reason for the disastrous financial prospects of the program.
What does the government know about global fraud?
In April, the government’s responsibility office under President Joe Biden produced what he called a “first estimate of the government and the government of the federal dollars lost for fraud”.
The estimate of the office of $ 233 billion to $ 521 billion lost in fraud per year, covered the 2018-2022 data in the reports of the general agency inspectors and fraud reports submitted to the management and budget office.
Musk quoted the top of the range of the range when he said “half a bill”. The White House did not answer our question on the source of its figure of $ 600 billion at $ 700 billion.
The GAO front -line figures included not only the official conclusions of the fraud of legal proceedings, but also the estimates of the conclusions of fraud of individual agencies. The agency also extrapolated figures which, according to them, represented an unteashed fraud.
Estimated losses represent approximately 3% to 7% of average federal expenses.
The management and budget office, the agency which helps the president achieved his budgetary objectives, noted a lower figure of fraud of the federal government, from $ 4.41 billion to $ 7.31 billion per year, on the basis of confirmed amounts through a legal or arbitration process.
Federal budget experts said it was important to pay attention to the complete analysis of government reports.
Joshua Sewell, director of research and policies among taxpayers for common sense, said taxpayers should see these figures with a “massive salt grain”. The report is filled with warnings and is probably not representative of other years due to the increase in pandemic spending.
“It is a good report to try to put figures for a amorphous question, but you cannot take the high-end figures as a final declaration on the amount of the fraud dollar that exists in federal expenses,” he said.
It is possible that around 5% of the annual federal budget is lost by fraud and that certain programs have inappropriate payment rates above 10%, said Bob Westbrooks, executive director of the Pandemic Responsibility Committee, a Congress of the Government Committee created five years ago. But the expression “inappropriate payments” does not necessarily mean fraud; It includes scenarios with insufficient documentation.
“Whatever the number is enormous in absolute terms,” said Westbrooks, referring to all fraud.
Westbrooks said Musk confused fraud and waste and ignored that the fraud of the COVID-19 era probably pushed the estimated government for the report itself.
The government of the government of responsibility said that the range is a “reflection both of the uncertainty associated with the estimate of the fraud and the diversity of risk environments present during the 2018 to 2022 fiscal year”.
What do we know about social security fraud?
During the White House briefing on March 11, Leavitt cited a report as an inspector general of the Social Security Administration which found more than $ 70 billion in fraud in this program.
The 2024 report did not conclude that there were more than $ 70 billion in social security “fraud”. He said the program sent nearly $ 71.8 billion in “inappropriate payments” from 2015 to 2022, a period that includes Trump’s first mandate. This represents less than 1% of global payments within this period.
On Fox Business, Musk said that “there is a huge amount of fraud” with people subject to false social security numbers to receive a range of government benefits, including social security, health care and unemployment aid.
Most of the inappropriate payments revealed by the Inspector General were overpayed with sub-paids. This happens, for example, when the beneficiaries do not report the necessary information or the administration did not update the recordings, according to the report of the Inspector General of 2024. None of the two necessarily represents criminal intention.
Social Security Administration has long been struggling to limit inappropriate payments.
“Without better access to data, increased automation, modernization of systems and changes in policy or legislative, inappropriate payments will continue to be a problem in the future,” said the report.
The Inspector General of Social Security Administration in 2021 found $ 298 million in payments after the death at around 24,000 beneficiaries from 1998 to 2019. These beneficiaries were in suspended payment status, but payments have always been sent because the technicians have not followed the policy or the search for all the death files available. The report indicates that he “had not identified specific cases of fraud” and provided information on the death at the investigation office.
The government has recovered around $ 84 million, the report said.
This year, the accused were convicted or convicted of fraudulently sent to the deceased beneficiaries, for identity theft used to obtain social security benefits and for the theft of social security payments for children.
How did the Social Security Administration attempted to fight against fraud and waste?
Musk said in Fox’s commercial interview that the federal government had made “many good audits”, but the agencies have not implemented the auditors in a coherent manner.
On March 3, the Inspector General of Social Security Administration published a situation report on his most recent recommendations.
In all, the Inspector General found 280 previous recommendations which had not been implemented with potential savings of $ 18.4 billion. In some cases, the Social Security Administration did not agree with the proposals. Some of the not implemented recommendations included a more in -depth examination of specific groups of beneficiaries for whom the agency is aware of possible differences. Others have suggested changes in computer system alerts.
Some of the government’s recommendations of the government’s responsibility in the congress also remained without implementation. In 2022, the GAO urged the congress to modify the law on social security to make permanent data sharing on complete deaths with the Treasury Department, but that has not yet happened.
Social Security is financially in difficulty in a decade
Social security faces a difficult path to come. Its existential financing problems are larger than the cases of deaths that obtain service checks.
The most important threats to the long -term viability of Social Security are a shortage of workers who feed their taxes in the system and an increasing number of Americans of the retirement age qualifying to receive services.
American life expectancy has increased since the creation of Social Security in 1935, as well as the number of eligible beneficiaries. But while the Baby-Boom generation (born from 1946 to 1964) has retired, fewer workers pay the system.
Social security trust funds will not be able to pay 100% of the services by 2035, according to the report by Social Security administrators 2024. Administrators have issued similar warnings for more than a decade.
Historically, most politicians of the two parties have deemed to offer social security changes. Political experts often call it the “third rail” of American policy – you touch it, you will die, at least in the ballot boxes, where older voters generally have the highest participation rate.
