On Ponzi schemes, broken promises and reaffirming our sacred social contract

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After weeks of chainsawing the federal government with no regard for the destruction of vital departments or the damaging effects on everyone from American farmers to veterans, Elon Musk recently called our Social Security system “the biggest Ponzi scheme of all time.” It’s clear from his statement that Musk, despite being a billionaire, doesn’t understand the concept of a promise or a Ponzi scheme. Nor does he seem to value the sacred social contract that binds us together as Americans and ensures our government works in pursuit of our collective health, well-being, stability, freedom and prosperity.

The Social Security system is a promise to the American worker. It is a prime example of the social contract that the U.S. citizenry has with one another via our government, creating a sense of intergenerational solidarity, where we promise to take care of those before us and those after us. Social Security, unlike a Ponzi scheme, is transparent and compulsory for every American worker. Each pays into the system, and as a result, every worker gets a modest monthly payout at retirement age until death. According to AARP, in Minnesota alone, more than 1 million “retirees, people with disabilities, and their families rely on Social Security for important benefits.” From Elmore to Ely, Minnesota families have contributed to and have depended on this promise, yet many are now fearful that our government will break it at the time they need it most.

With Americans living longer and fewer people in the succeeding generations, the American working population is no longer large enough to make the system self-sustaining with what we put into it, especially since Social Security is capped for workers once their wages exceed $176,600 annually. This means someone like Elon Musk, the wealthiest human on the planet, pays the same amount in Social Security wages as your local orthodontist. Thus, our Social Security system is underfunded because everyone isn’t contributing fairly.

America’s social contract with the elderly is an explicit promise we have to one another, which we empower our government to uphold. We promise to help take care of our fathers and grandfathers and mothers and grandmothers in exchange for a lifetime of work and contribution to society. Our social contract promises to provide a base level of retirement income through Social Security because our employers are not required to provide retirement plans.

This is exactly how my grandmother, who lived in Appalachia, survived her twilight years, when she suffered from dementia after working as a domestic for multiple families for nearly 50 years, never being paid a fair or minimum wage her entire working career. This isn’t just true for domestics. As corporate jobs are outsourced and government jobs privatize positions, workers are left without employer-provided retirement plans. The burden of retirement is shifted from the employer to the employee, who now often makes lower wages, so reliance on Social Security becomes even more critical for the average American. And a future without this social contract, particularly as the baby boomer generation retires, would be significantly more costly and damaging for families and our nation.

The social contract is more than economic security; it is about education, work, health care, housing, safeguards, safety nets and social inclusion. It is about dignity, opportunity and protection for every American regardless of their race, religious beliefs or who they voted for. A contract is a promise — something you don’t break.

Unfortunately, more recently, our government has shown it is willing to break contracts, promises and the sacred covenants that we have with one another and with the institutions that we rely upon. This includes breaking promises to nongovernmental entities like nonprofits, which are often more closely embedded within our communities and can provide direct, efficient services, such as senior housing and character education for young people, and to universities that conduct Alzheimer’s research and prepare our young adults for purposeful professions.

The dismantling of the federal Education Department, which constitutes roughly 10% of public schools’ funding and provides services for those with the greatest vulnerabilities and developmental needs, is a clear example of the abandonment of the social contract. A divestment in education will further strain the social contract for youths. If our country doesn’t invest in young people and the future through education and prepare the next workforce through job training, then it is undermining the reciprocity of the social contract.

Admittedly, some federal spending is bloated, and certain programs warrant change. Despite this, Americans must also remember the direct value our government provides and not be enticed to be heavy-handed with inflammatory phrases like “Ponzi scheme” or theatrics of chainsaws. Government reforms can be done with dignity and respect and without breaking the government that most Americans depend on and the nation to which we pledge our allegiance. Precision knives will be far more useful than chainsaws because it is much harder to rebuild what is haphazardly destroyed.

This isn’t about partisan politics; rather, it is about what we owe one another. As Americans, we cannot allow political divisions to seep into and destroy our long-held promises. We know that a house divided cannot stand and broken promises undermine our democracy. We also know that a binding social contract makes us stronger, more united and more resilient in helping everyone enjoy the fundamental elements of the American promise — freedom, opportunity and equality.

Tonya Allen is president of the Minnesota-based McKnight Foundation, which describes itself as seeking “to advance a more just, creative, and abundant future where people and planet thrive.”