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The grant, contract and budget cuts in federal agencies, along with the crippling reductions of tens of thousands of government jobs, will “in all probability” end up increasing (by a lot), rather than decreasing the nation’s deficit, which has been the stated intent, notes a new report.
The Department of Government Efficiency (DOGE) hatchet man Elon Musk initially boasted that he would carve $2 trillion out of government spending — even the Trump administration works to slash the nation’s income via tax cuts that will largely accrue to the wealthy by $4.5 trillion. (The Republicans are also planning to increase military spending by $150 billion over the next five years.)
Now Musk is claiming he may reach half of that goal — $1 trillion in cuts — by the end of the year..
It’s impossible to know what has actually already been cut since Musk’s “receipts” have been relentlessly riddled with significant errors that all make it look as if he has saved far more than he actually has.
Jessica Riedl, a budget expert at the Manhattan Institute, recently estimated the actual savings so far at about $2 billion — one-tenth of 1 percent of Musk’s original goal of $2 trillion, The Atlantic noted in a report Friday.
Prediction markets currently expect a grand total of $1 billion in savings.
Many of the cuts will actually cost, including via the taxpayer salaries going to an army of lawyers from the Department of Justice battling a cascade of court cases against the government’s dismantling that many judges have already said appears to be illegal.
Damages from any illegal firings are likely also to be extremely pricey, along with buyouts and paying people on leave, who are doing absolutely no work for full salary just so Donald Trump can keep them out of the office.
Among the most massive costs will be the huge reduction in workers at the Internal Revenue Service, who are worth their weight in gold because of the taxes they collect, the key source of income for the country.
The IRS released a preliminary survey showing that it expects revenue to fall 10 percent, or $500 billion because of a shortage of IRS workers and a boost in tax cheats confident they can get away with breaking the law. Those losses would swamp any DOGE savings to date.
“The failure” of the DOGE enterprise was “preordained,” states the Atlantic. “There isn’t anything close to $1 trillion in waste, fraud, and abuse in the budget, despite Musk’s repeated statements to the contrary,” writes reporter Jonathan Chait.
Musk is also carving critical holes in the government that will have to be filled at some point before implosion by private companies — if not his, then others, with personnel likely paid far more than government workers. Some of Musk’s team of DOGE are reportedly making six-figure salaries, while veteran workers are getting the ax.
Musk’s SpaceX is already taking over key tasks in the Federal Aviation Administration, and FAA staffers have been told if they stand in the way, they risk being fired.
Another hit could be felt for years by businesses that lose their competitive edge over enterprises from other countries amid decimated federally funded research and development in medicine and technology.
Ultimately, Musk is managing to “incapacitate the government’s functionality” critical areas “without improving the government’s fiscal position,” The Atlantic warns.
