President-elect Donald Trump’s newest efficiency advisor, billionaire Elon Musk, wants to take at least $2 trillion off the top of the annual federal budget: This is what a cut of that scale would resemble.
Trump brought Musk and fellow tech billionaire Vivek Ramaswamy a step closer to realizing his budget-cutting dreams Tuesday when he named them and their ilk to an advisory council called the “Department of Government Efficiency (DOGE)” to provide guidance on how to ‘slash excess regulations, cut wasteful expenditures, and restructure Federal Agencies.’
Last month, at a rally in New York, Tesla’s CEO and owner of social media platform X called for “at least $2 trillion” in budget cuts.
That would be a big cut in relation to the size of the federal budget — it was $6.7 trillion in the fiscal year that ended in September. Then, Social Security, the government’s biggest program, is $1.45 trillion. Musk would get three-fourths of the way toward his goal if he were able to eliminate it completely.
That also would be a change of pace for Trump when it comes to cutting the budget by that much. Leaving office, his federal budget was more than 50 percent higher than when he began the first of his four terms, partly due to the federal fight against COVID-19.
Similarly, budget cuts would have to pass Congress — a move that lawmakers would have to weigh how much money to cut from popular programs like Medicare. Notwithstanding any recommendation from the DOGE, many economists forecasting where the economy will go under Trump are assuming Congress will make few if any, cuts to the federal budget.
But it’s hard to see where more spending cuts will come from (and those cuts are fought for by both parties in Congress), wrote Brean Capital economists John Ryding and Conrad DeQuadros in a commentary last week.
Areas Of Focus For Budget Cuts
Musk and Ramaswamy have outlined several potential areas for cuts, which include:
- Reducing Federal Workforce: One of their strategies involves decreasing the number of federal employees significantly. Musk has suggested that streamlining the workforce could lead to substantial savings.
- Eliminating Redundant Regulations: The duo plans to review existing regulations critically, aiming to dismantle what they describe as bureaucratic obstacles that hinder efficiency. They argue that many regulations were enacted without proper congressional authorization and can be rescinded through executive action.
- Targeting Specific Programs: Musk has indicated an interest in cutting funding for various programs, including public broadcasting and certain international aid initiatives. This aligns with his broader vision of reducing what he perceives as unnecessary government expenditures.
