Elon Musk‘s newly formed Department of Government Efficiency has made bold claims about slashing federal spending, but a review of Treasury data suggests the savings are more fiction than fact.
Despite Musk’s assertions that his team is saving the government $1 billion per day, federal outlays have actually increased since President Donald Trump took office, according to daily Treasury statements analyzed by The Economist.
In the three weeks since Trump’s inauguration, federal spending has averaged $30 billion per day, up from $26 billion during the same period last year under President Joe Biden. More than that, the government’s spending trajectory in the current fiscal year closely resembles that of the past two years, indicating no significant impact from DOGE’s efforts.
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Musk has promised over $2 trillion in annual savings for the federal government, but achieving the goal appears unlikely given the structure of the U.S. budget.
Nearly two-thirds of the projected $7 trillion in spending this year is allocated to mandatory expenditures like Social Security and health insurance, while another 10% goes towards interest payments. That leaves only a quarter of the budget for discretionary spending, half of which is earmarked for defense—an area Republicans aim to increase.
DOGE initiative is focused on rooting out fraud and waste, but even eliminating all estimated losses from fraud, which the Government Accountability Office puts between $233 billion and $521 billion annually, would fall far short of Musk’s ambitious targets.
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Many of DOGE’s spending reductions have targeted specific programs deemed wasteful by Trump, like diversity, equity, inclusion, and accessibility initiatives, which represent a small portion of the federal budget.
To date, the total value of savings announced by DOGE amounts to approximately $7 billion, The Economist said, with some reductions coming from the cancellation of multi-year contracts, resulting in lower annual savings than the headline figures suggest.
Even if the controversial funding cuts at the United States Agency for International Development, America’s primary international development agency, is counted as a cost-cutting success, DOGE’s total annual savings would reach about $45 billion, a mere 0.6% of federal spending.
While DOGE’s actions have impacted the morale and job security of thousands of government employees, its core mission of saving money appears to be falling short. As Musk said on Tuesday, “It’s not optional to reduce federal expenses. It’s essential.”
However, the gap between what he said and the apparent lack of progress in cutting spending points to the challenges his project is facing.
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