
Musk’s DOGE aims to cut $2 trillion in spending. That will be tricky.
Musk’s DOGE aims to cut $2 trillion in spending. That will be tricky.

It’s resolution season and, personally, I have a whole set of resolutions for 2025: I’m going to cook all of my meals (no more ordering in); I’m going to stop drinking alcohol (very en vogue right now); and I’m going to go to the gym five days a week (at least).
The Department of Government Efficiency, aka DOGE, is a Trump-appointed task force headed by Elon Musk and Vivek Ramaswamy, and it has some lofty resolutions for its stated goal of cutting wasteful government spending.
The U.S. budget clocks in at about $6.5 trillion per year. Musk announced at a campaign rally for President-elect Donald Trump that he was going to cut $2 trillion. That’s right — fully a third of the budget. When Musk announced this, the crowd went wild. Musk smiled, “Your money is being wasted,” he said. “And the Department of Government Efficiency is gonna fix that.”
Resolution season can bring out the cockeyed optimist in all of us.
But a few weeks later, reality seemed to have set in: Musk and Ramaswamy published an op-ed in the Wall Street Journal announcing planned cuts to the U.S. budget of … $500 billion.
$500 billion, to be clear, is a lot of money and is still a very ambitious spending cut goal. But it’s a far cry from $2 trillion.
Honestly, I can relate. As the first week of January —which doesn’t really count toward your resolution, from what I’ve been Googling — drifted into the second week, I began to realize that five days a week at the gym is a lot of days. I’m not trying to be a bodybuilder, I just want to get in better shape. Three days a week is more than enough to achieve that!
But as we enter week three of January and my neatly packed gym bag gathers dust in my coat closet, even my scaled down goal is beginning to seem like a resolution … deferred.
“My first thought was, ‘Well, good luck!’” said Douglas Holtz-Eakin, an economist at the American Action Forum. He was not actually talking about my fitness goals. He was talking about finding cuts in the U.S. budget.
Holtz-Eakin served as an economic advisor for George H.W. Bush. He also headed the Congressional Budget office in 2003 and said that cutting the budget is a tangled web for even the most determined soul.
“They are successful, prominent people, and I get all that,” said Holtz-Eakin. “But DOGE itself has no authority.”
It is, after all, Congress that passes spending bills and not DOGE. “They get to think hard and make recommendations,” he said. “They’re a think tank and I run a think tank, so I know just how ineffective think tanks can be.”
Holtz-Eakin’s think tank, the American Action Forum, has looked at the Federal Budget a lot over the years, and he worries DOGE is looking for cuts in all the wrong places.
Take this clip where reporter John Stossel asked Vivek Ramaswamy about his DOGE plans. So far, both Musk and Ramaswamy have talked extensively about doing away with many federal employees — as many as half.
That would be a lot of job cuts: 1.5 million to be exact. Would that be dramatic? Yes. Would that make a statement? Yes. Would it make a difference for the budget?
“That’s not where the money is,” said Holtz-Eakin. “The money is not in federal employment.”
In fact, compensation for all federal workers totals around $300 billion — not even 5% of the federal budget.
The other big announcement out of DOGE has to do with ending the Department of Education. But the math might not quite make sense there either, said Louise Sheiner, an economist specializing in fiscal and monetary policy at the Brookings Institution.
“It doesn’t really make a big difference in the long-run fiscal challenges if you eliminate the Department of Education,” she said. In fact, the Departments of Education, Agriculture, Transportation, and Law Enforcement — all put together — don’t even make up 15% of the budget.
And those departments do a lot, Sheiner noted. “You’d be decimating these programs and that would be a huge mistake, because they produce a lot of value.”
So where could DOGE cut? There are a few obvious options: Defense makes up about 15% of the budget, another 10% goes to paying interest on the nation’s debt, but fully half of the U.S. budget is made up of just three programs: Social Security, Medicare and Medicaid. Together, those cost the U.S. about $3 trillion a year.
Sheiner said getting the budget under control is totally possible if you tackle those programs and take a varied approach, “with a combination of tax increases and probably some modifications to Medicare, Medicaid and Social Security.” The changes need to happen soon, Sheiner said, but they wouldn’t need to be all that drastic or painful.
So why isn’t that happening? “The economics is not the problem,” she said. “The major impediment is politics.”
Douglas Holtz-Eakin said after spending years trying to reform the U.S. budget, the issue always comes down to this: If you really want to deal with the budget, you need to look at Social Security and Medicare. But politicians don’t want to look at Social Security and Medicare, because those are deeply beloved programs, and the people using those programs vote.
“Right now, if you go to the town hall and say, ‘I’d like to reform Social Security,’ you might as well just walk out and start working at the Dairy Queen,” Holtz-Eakin said.
After all, the people who make all the budget decisions were elected to their positions, and they want to be elected to those positions again.
It is absolutely possible to modify and trim down Medicare and Social Security spending, said Holtz-Eakin, but it requires politicians to communicate with voters: explain what the cuts would be, why they have to happen and then ask people to come together and tighten their belts for a better future. It would also require Congress joining forces across the aisle.
That is what DOGE is really up against.
And that’s why Holtz-Eakin is skeptical that team DOGE will be able to match its formidable bark with any kind of bite.
“I just don’t think this Congress is going to be the one that holds hands and jumps,” he said. “I don’t see this president as providing the leadership. So, you know, maybe I’m just a beaten-down Washington swamp-dweller, but I’ll believe it when I see it.”
The same could possibly be said about my languishing gym membership. But the obstacles are quite formidable! For one thing, it’s 22 degrees out. For another thing, I’m getting over a cold (and I would never want to get anybody sick), and I think I felt my old running injury flare up a little, and it might be best to rest for now. I’m feeling good about tomorrow, though.
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