The Social Security Administration tracks individuals’ contributions, but it does not function like a bank account where specific users’ money can be withdrawn, O’Malley said. 

O’Malley said the agency has struggled for the past decade with an aging computer system and funding cuts. Social Security benefits are expected to be paid on time and in full until 2035, according to the agency and O’Malley. After that, reduced payments are projected unless there are legislative changes that Panetta and others have proposed.

O’Malley and Panetta essentially said the agency should be bolstered and modernized, not dismantled and handed to private bankers who would make riskier investments with workers’ contributions. Although privatization could yield more money for retirees through investments, a recent poll suggested that 89% of Americans 60 and older opposed privatization. 

Trump has said publicly that there are no plans to privatize Social Security, but actions since January have weakened it, O’Malley said. Social Security had about 57,000 employees as of early February. Social Security leaders said Feb. 18 that they want 50,000 employees, and offered buyouts.

Twenty-six Social Security offices are expected to close nationwide this year, but none in California, according to the Associated Press. The Social Security Administration has offices in Santa Cruz County at 169 Walnut Ave. in Santa Cruz and at 180 Westgate Drive in Watsonville. 

“This is an agency that has already been reduced by House Republicans to a 50-year low in staffing, even as their customers climb to an all-time high,” O’Malley said. “The effect that all of this has is it is gutting an agency that is already depleted. I truly believe they have taken most of the actions necessary to push this agency into a total system collapse,” he said. 

U.S. Rep. Jimmy Panetta speaks at a housing event in Santa Cruz in 2024. (Jesse Kathan — Santa Cruz Local file)

Fraud and data handling

O’Malley said some recent allegations of Social Security fraud have been overblown. Leaders of DOGE have said millions of checks have been written to deceased people. O’Malley said Tuesday that “they didn’t know what they were looking at” because none of those accounts were necessarily in “paid” status. 

Death records are automated within the Social Security system. In cases of fraud where living people’s payments are redirected to fraudulent accounts, the beneficiary typically reports it within one or two months, O’Malley said.

Tuesday, Social Security leaders announced that people who cannot verify their identities through their My Social Security online account must visit a Social Security office in person to prove their identity. The transition is expected this month. 

Senior advocates have said the changes make it harder for older people and people with disabilities to access benefits. 

O’Malley and Panetta said they feared that loose data handling by DOGE staff could lead to fraud at the Social Security Administration.  

Acting Social Security Administration Commissioner Lee Dudek granted DOGE staff access to records including Social Security numbers and other personal data, ProPublica reported. Panetta said DOGE staff also might have “sensitive banking information.” 

A court order has limited the people who have access. Thursday, a Maryland federal judge temporarily blocked the agency from granting DOGE access to records with personal information and ordered DOGE staff to delete all records obtained since Jan. 20, according to news reports.

“I’d like to say it’s unlikely that DOGE will directly attempt to steal from people’s accounts,” Panetta said. “I think it’d be more about something when it comes to being careless.” 

Panetta said he would try to resist the destruction of Social Security through his work as a member of the House of Representatives’ Ways and Means Subcommittee.

“We will not stand by while Social Security is gutted by President Trump, Elon Musk and DOGE,” Panetta said. “We’re going to continue to fight this tooth and nail.”

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