Social Security Could Be Privatized Under DOGE, Democrats Warn. What Would That Mean? | Global News Avenue

Democrats and independents warn that cutting the Social Security Agency’s budget is a step forward Privatize social securityExperts say the move could help address the program’s cutbacks, but will be a difficult transition.

SSA plans as part of the Government Efficiency Department’s goal to reduce federal spending Cut or avoid spending $800 million this fiscal year And cut more than 12% of the labor force. While neither the White House nor the Dewey people made it clear that their goal was to privatize Social Security, comments by Governor General Elon Musk involved some left-leaning politicians.

“(Musk) has been talking on TV over the past few days about Social Security, Medicare and Medicaid and what he intends to do – to private it,” Rep. John Larson (D-CT) said at a committee meeting last week.

Additionally, politicians say Musk’s criticism of the program’s older database and called Social Security “the biggest Ponzi scheme ever”, aiming to shift the public’s negative attitude towards SSA.

“Why does it look like a broken, dysfunctional system? The reason is to lose confidence in the system and you can hand it over to Wall Street,” Senator Bernie Sanders (I-VT) said in an interview with CNN.

What does this mean for the beneficiaries?

With the expected major trust funds for Social Security to expire in 2033 with a 17% reduction in revenue, some view privatization as the savior of the program. Former Presidents Bill Clinton and George W. Bush.

BlackRock CEO Larry Fink said at a BlackRock retirement summit Wednesday that if Bush succeeds, Americans will be the return of the S&P 500, which will be four times the pension. CNBC.

“The problem we are having now is that we have a plan called Social Security, which is not going to grow with the economy,” Fink said.

Today, Social Security is funded by payroll taxes, which are consolidated into trust funds to pay benefits to current retirees and invest in Treasury bills. The amount of Social Security benefits depends on a formula that requires an average income of a person and the age at which they retire.

By contrast, privatized social security will transfer the management of funds to the private sector through some form of partial government funding or guarantees. It may cancel payroll taxes in lieu of personal contributions from private accounts, which can be invested in high-income but high-risk investments.

However, it may be difficult to transfer to a private plan. Payroll taxes will require transferring them to a private account, but the current retirees do not have any funds. This means that retirees’ benefits may have to be cut or current workers must pay their private accounts and payroll tax until the transition is complete.

According to a recent survey of Seniforliving.org of 60 and older, only 11% favor privatization of social security.