SocSecDOGE
Freddie: Lately there's been growing talk about how digital markets, yes, even DOGE might be influencing Social Security stability. In this episode of Leibel On Fire, we're unpacking what's behind the headlines, what it could mean for you, your benefits, and how to stay informed and prepared.
Hello again and welcome to Leibel on Fire. I'm Freddie Bell and I'm with Leibel Sternbach. He's Amazon's bestselling author and I love telling you this all the time because it's a big deal. The name of the book is Living With Financial Anxiety and also Authenticity. Let me introduce you right now to Leibel Sternbach.
Hello.
Leibel: Hey, how are you doing today?
Freddie: Unbelievable. Glad to be with you. And we're talking about it. I didn't think we'd ever get here, but we are going to talk about it. What are the DOGE actions and how could they actually impact Social Security payments? So,
Leibel: DOGE is, the Department of Government Efficiency.
That is, Elon Musk's and, I mean, many presidents have proposed doing what they are doing. But you know, in true Elon Musk fashion, he is doing it in a way that just upsets everyone. He is. Did we
Freddie: see this in the Ronald Reagan administration? Portions of this.
Leibel: Yes, and Clinton proposed it, that there was apparently a 2000 page report that Clinton commissioned that went nowhere.
Obama tried implementing a whole bunch of these. The various presidents throughout the years have tried doing this. Most have never gotten past the planning stage. They got a commission. They came up with a set of reports and recommendations in true government fashion, and then it just never went anywhere.
Right? Or they made minuscule amounts of cuts that really didn't have the global impact. And to be fair, like Clinton, who is a Democrat, he managed to bring down the deficit and balance the budget, right? Balance the budget while increasing Social services, right?
So it can definitely be done. And then we had the War on terror for the next, 25 years. So, war does some interesting things, but one of the things it does do is it increases government because all of a sudden you have all these contractors who worm their way into government and you have money being spent at an incredible pace.
And then we had the 2007, 2008 housing crisis. A lot of it was by government incentive programs that shouldn't have existed. But the end result was a lot of that was driven or incentivize to create jobs in the government. And so we went from having a relatively small government that just over the last 25 years have increased exponentially in size, whether that's good or bad or not I don't really care about that. What does matter though is as any
company increases, and anyone who's worked in a bureaucracy knows there are these people who just find their way in and these things that get created and then get stuck there, right?
There's a manager he wrote a whole bunch of books on management and one of his books, he starts off by talking about this job that he got in government where the president, some president got elected, don't remember who it was.
I don't know if he even said who it was. President got elected, created some kind of new inter-agency task force, and he got hired to this job. He shows up at the office, nobody at the agency has any idea who he is, what he's supposed to be doing there. They give him an office and then the president got distracted by other stuff.
Nothing ended up ever happening. He ended up working in the government in a job that was nothing. Nobody knew why he was there. The head of the agencies who came and went wanted nothing to do with him because they were like, as long as you stay outta my way, I'm not going to try to find out what you're supposed to do.
And so he just started creating memos. He just started sending memos to different departments asking like where's the staples? I need more staples! And requisitioning things. And by doing that people stopped asking why he was there because they didn't wanna have to deal with questions. So he just started like creating paperwork.
But that's what happens in the government, right? And this guy had this job for like 15 years until he retired on a government pension because he created a job for himself, because a position was created that everyone forgot about. Nobody knew why he was there. And he kept people from asking why he was there by making them do work and nobody wanted to do work.
So they ignored him.
Freddie: Wow.
Leibel: But this is what happens in government. This is what happens in large corporations. Large corporations are incentivized to cut people and to lay people off. Generally, that happens 'cause the economy tightens, there's some kind of contraction. Shareholders want to come in and get value so they slash their employees
and you cut that waste. Government doesn't really do that, right? It doesn't cut departments, it doesn't fire people. We have unions. So DOGE the idea behind DOGE is that it's gonna come in and it's going to create that government efficiency. Whether it's the right thing to do, whether it can do what it's doing, whether it's legal, what it's doing.
Not a question that I'm gonna even attempt to answer. That's for the courts, that's for Congress. That's for the history books.
Freddie: How does it impact Social Security though? We've got people who are getting the augmented Social Security payments.
What will DOGE do to those payments?
Leibel: So, Elon Musk, who is the defacto head of DOGE he basically accepted a mandate to cut $2 trillion worth of spending from the federal government. When we look at where the federal government is spending money,
78% of the budget is on what's called non-discretionary spending. So that's Medicare, Medicaid, debt service payments, that's really it, right? The 22% that's considered discretionary includes the military, includes the Department of Education, all of that stuff.
But, 78% is Social Security and Medicare. And debt service. And so when you look at where are you gonna cut $2 trillion, if he goes to the 22%, that discretionary spending, which our military is a big portion of that, and then these other services that we really need. I think Elon Musk had this vision that initially if he just went in, he could find $2 trillion in there, and then he quickly realized
even if he cut $2 trillion outta spending there, that would leave the government with no programs and like everything that we're spending, that's not where the bulk of the money is being spent. The bulk of the money is being spent on Social Security and Medicare and debt service, and so that's why he's going after Social Security and Medicare.
We do know that there's fraud in Medicare. We do know that there are people who are getting paid that shouldn't get paid, I don't think when it comes to Social Security. I don't think Elon Musk understands how Social Security works because nobody understands how Social Security works until they get into this world that I'm in of planning for Social Security, right?
And then you learn about all the rules and then even when you learn the rules and you learn how it's supposed to work, it's very different of what's actually happening. I don't think he's gonna find the savings in Social Security that he thinks he's going to. I think there's a lot of threats of him cutting programs, but at the end of the day, you can't cut Social Security be not in the way that he expects to be able to cut.
Not in the way that he's talking about cutting. It isn't discretionary spending. It's you paid into this program and it's a Social contract between you and Congress. And Congress is the one who created Social Security. He can't come in and change the rules of how Social Security works.
It requires an act of Congress. So like he can go in and monkey around with the Department of Education. He can go in and monkey around with how the treasury works because those are, executive branch things. Social Security, while it is under the executive branch, it is created by Congress, it's funded by our payroll.
It is not something that really Elon Musk has control to be able to control how it works, or who it pays out to. Right. There's very limited levers for him to control.
Freddie: So in that regard, should retirees be concerned, number one, about whether or not their checks are gonna be reduced or delayed, or should there be any worry at all with people who are dependent upon, at least in some portion for Social Security payments?
Leibel: So I think people who are currently receiving Social Security should not worry because it would be almost impossible for him to affect those benefits.
Freddie: Okay.
Leibel: At least if you're receiving Social Security retirement benefits, if you're receiving Social Security disability benefits, or you are receiving Social Security supplemental income benefits, those, he has a little bit more control to manipulate.
However, I think it would be very difficult for him to actually make any impact there because Social Security is notoriously difficult to actually get approval for, right? In fact, most of the time you have to be denied two or three times before you get approved and you have to hire lawyers to fight for you.
So I think they do a very good job of weeding out the fraud in those areas. I think Elon Musk is gonna find that. I think he's actually gonna hurt us in the long run because, right now he is highlighting the fact that you've got young people and you've got old people, insanely old people, 200 year old and 300 year old people on Social Security payrolls paying into the system or receiving checks.
He's gonna cut that because he is gonna, be like, oh, well we shouldn't have people like that on the system. The young people he is gonna discover are legitimate beneficiaries. With the old people, he is going to discover that it's just gonna cut our revenue. The Social Security Administration has been open about the fact that they know these people are on the payroll, are paying into the system.
They know that these are, in many cases, illegal immigrants who are using stolen identities to get jobs and are paying into the system. So that money that's coming in is going out to beneficiaries, right? It's part of your Social Security check is all these illegal immigrants who are using stolen identities to pay into Social Security.
I don't know about you, but I would like to keep that money. Yes.
Freddie: So is there anything that a retiree can do right now, or is there any real need for a retiree to try to protect themselves and their assets? At this point?
Leibel: So I think when it comes to retirees and Social Security, I think what we need to look at is that Congress, and we need to look at the legislation that Congress is introducing.
When Congress looks to reduce Social Security payments, they do it by altering the rules for new beneficiaries. So what we need to look for are rule changes that can only go through Congress. Elon Musk can say all he wants, he has no ability to change rules when it comes to Social.
Who is eligible for Social Security benefits? 'Cause that is going to be the thing that is going to impact you. So we gotta look at what Congress is doing. I think they are self preserving enough that they know that the biggest voting block is those people over the age of 60, and I don't think they're gonna do anything to disenfranchise that group.
So, I am not worried so much about that. We do need to keep our eye on it because it is very much like the Trump administration. To distract us with something while they sneak through legislation that would reduce benefits. But that is something that we are actively keeping an eye on.
Medicare though, and Medicaid that they will monkey around with. And there is a lot of room that they can do without Congress. I don't know whether it's a good thing or a bad thing. Medicare pays out 80 cents on the dollar now. I think it's 87 cents on the dollar to health insurance. Health insurance in our country is a mess, but at the same time,
I wouldn't give up the mess that we have for what Europe has because Europe is only able to do the healthcare system they have, because we're the ones doing all the innovation when it comes to drugs, right? We invent something like 90% of all of new treatments and all of new drugs and they just, basically steal that from us and sell generics.
I think our healthcare system does need to be overhauled. Our health insurance system is completely screwed up. And I haven't heard a good proposal of how to fix that. If he can find a trillion dollars of cuts of Medicare, I would argue that would not impact anybody's healthcare at all.
Because like one of the things that he's found is, and it's something that every health insurance agency knows about is that if somebody moves states, while they're on Medicare, two people get paid for it for the entire year. That shouldn't have happen.
Why is Medicare paying double for the same person?
Freddie: That shouldn't happen. And we're just about out of time Leibel. Knowledge is power. How can we get more information about Social Security and what could lie ahead for us?
Leibel: So I think when it comes to Social Security, keep an eye on my emails because as soon as something actually happens, as soon as something happens that you should be aware of, that you should take action on, I will send emails out about it.
So keep an eye on our emails. Keep an eye on what Congress is doing. Don't read the op-ed pieces. Look for the announcements of what bills Congress has passed. And it doesn't help if something passes the Senate but not Congress. Or the other way around. The house and not the Senate, because you need both of them to pass something right for it to actually take effect.
And so there is a lot of rhetoric being thrown around. There's a lot of bills being introduced that they know have no chance of passing, that are just designed to get headlines, and it's on both sides of the aisle. So you just need to look at what actually is getting passed. Look at the commonalities between the bills proposed, and those are the things to worry about.
Freddie: Basic civics class.
Leibel: Yeah. Leibel
Freddie: thank you so much. Just gleaning from this, even with the challenges that we have on the horizon, there are always steps that you can take to stay secure and remain confident about your future. Thank you for joining us. Stay encouraged, stay informed, and we'll see you next time with Leibel On Fire.
