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The Social Security Administration has announced that it will implement over $800 million in cost-saving measures for fiscal year 2025.
Some shit you should know before you read: Shortly after President Trump took office, he tasked Elon Musk with overseeing the Department of Government Efficiency (DOGE), a newly established agency aimed at cutting federal waste and modernizing government operations. DOGE has played an active role in auditing agencies, using artificial intelligence to detect fraud, waste, and abuse. Their investigations have revealed millions in unnecessary spending, including rented office spaces that sit empty, redundant contracts, and outdated IT infrastructure that increases operational costs. Despite support among some, critics, including former government officials and watchdog groups, warn that DOGE’s aggressive cuts are weakening essential services and giving Elon Musk too much power as DOGE is now looking into Pentagon spending and contracts, which Musk benefits from.
What’s going on now: In an announcement, the Social Security Administration (SSA) revealed it has identified more than $800 million in cost savings and cost avoidance for the 2025 fiscal year, focusing on payroll, information technology, contracts, grants, real estate, and operational expenses. The most significant savings—$550 million—come from a hiring freeze and drastic overtime reductions for SSA and Disability Determination Services (DDS) employees, a move that will significantly cut labor costs but could also impact service delivery. SSA also made deep cuts to its Information Technology Systems (ITS) budget, canceling non-essential contracts and reducing spending on other IT-related services to save $150 million.
Acting SSA Commissioner Lee Dudek defended the cuts, stating, “For too long, SSA has operated on autopilot. We have spent billions annually doing the same things the same way, leading to bureaucratic stagnation, inefficiency, and a lack of meaningful service improvements. It is time to change just that.”
Beyond labor and IT cuts, the SSA is scaling back on travel, reducing non-ITS travel by 70%, which is expected to save $10 million. The agency also terminated $30 million in contracts and grants, aiming to eliminate redundant or unnecessary programs. In an effort to reduce operational costs, the SSA identified 270,000 square feet of non-public-facing office space that will be vacated, saving $10.2 million, with another 30,000 square feet set for downsizing in the near future. Additionally, 60 lease terminations are projected to save $4 million annually. Security staffing at SSA field offices is also being restructured, with a new model expected to save $30 million in 2025.
Another view: Critics say reducing staff and resources could cause service delays and disrupt benefit payments, especially since the agency is already dealing with shortages. Still, the SSA insists these cuts are essential for maintaining fiscal responsibility and keeping operations efficient while serving beneficiaries.
