Despite faux fanfare and outrage, DOGE hasn’t even scratched the federal budget monster

Many of my fellow fiscal conservatives cheered President Trump’s executive order establishing the “Department of Government Efficiency,” headed by billionaire businessman Elon Musk.

Indeed, as the author of hundreds of reports and articles showing how to reduce federal spending and deficits, I was cautiously hopeful that Musk would follow the language of the executive order to “moderniz[e] Federal technology and software to maximize governmental efficiency and productivity.”

Government waste — while not a lead deficit driver — represents the lowest-hanging fruit to cut.

The Government Accountability Office recently estimated that fraud costs the federal government between $233 billion and $521 billion annually. The Office of Management and Budget estimated that payment errors alone totaled $191 billion in 2023.

Additionally, Washington runs dozens (and sometimes hundreds) of overlapping programs addressing economic development, drug abuse, K-12 education and other areas.

Wrong focus

Unfortunately, DOGE has thus far failed to achieve significant savings because Musk has instead focused on high profile culture war targets to maximize headlines rather than the quiet, boring work of deficit reduction.

MAGA Republicans may thrill at attempts to defund DEI contracts, Politico subscriptions, government employees and foreign aid. Yet this spending is barely a rounding error in the federal budget.

So while Musk’s target savings have fallen from $2 trillion annually, to $1 trillion and now
$150 billion, its “wall of receipts” has verified just $2 billion of savings — or 1/35 of 1 percent of federal spending.

The rest of the claimed savings either were not specified or consisted of major mathematical and accounting errors, such as confusing an $8 million cut for $8 billion, canceling contracts that ended decades ago and triple-counting the same contract cancellation.

For context, federal spending had already been set to rise by $278 billion this year.

Now, at the rate DOGE is cutting, it may rise by “only” $270 billion.

And if DOGE follows through on threats to cripple the IRS, the substantial rise in tax evasion will likely result in DOGE expanding overall budget deficits.

Nor can we assume larger savings are coming.

Three-quarters of all federal spending goes to Social Security, Medicare, Medicaid, defense, veterans and interest, and the final quarter includes priorities such as infrastructure, justice, border security, national parks, unemployment benefits, disaster aid and disability benefits.

‘Protecting’ GOP voters

Trump has already taken much of this spending off the table for cuts, and Congress is highly unlikely to gut these functions.

DOGE has been careful to protect most Republican voters from cuts by targeting government workers, foreign aid and DEI spending — and even that produced small savings.

The political waters will grow more treacherous when it moves to spending that Republican voters support, such as Social Security, Medicare, defense, veterans’ benefits, border spending and infrastructure. DOGE has already backtracked on plans to slash Social Security customer service and veterans hospital personnel.

A serious war on bloated federal contracts would begin in the Defense Department, where procurement contracts routinely face cost overruns in the billions of dollars.

It would address $100 billion in payment errors across Medicaid, Medicare and unemployment benefits.

Yet DOGE has seemingly lacked both the expertise and patience to sufficiently prioritize the hard work of rebuilding the payment systems across hundreds of federal programs.

It is jarring to see DOGE claim success even as congressional Republicans quietly passed a budget that expands budget deficits by an additional $5.8 trillion over the decade.

There is a responsible path forward. Stop focusing on flashy “spending cut theater” targets and dig into the hard work of reforming entitlement payment systems, defense contract overruns and program duplication.

Such non-ideological savings reforms will have the added benefit of likely winning congressional approval, making them fully legal and sustainable.

Otherwise, Trump supporters may be surprised at the end of the year when — after all the tweets, promises and headlines — spending and deficits have sharply climbed again.

Jessica Riedl is a senior fellow at the Manhattan Institute. ­Follow her on Twitter @JessicaBRiedl.