The DOGE brothers are in for a rude awakening

The DOGE brothers are in for a rude awakening

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Once upon a time, a brash outsider entered the Oval Office with a promise to “drain the swamp.” He brought in a corps of businessmen, led by a leading industrialist, to work like “tireless bloodhounds” to root out inefficiencies in Washington’s vast bureaucracy.

It was 1982 when President Ronald Reagan’s clemency commission began getting rid of hundreds of billions of dollars in wasteful spending.

Much like President-elect Donald Trump’s Department of Government Efficiency, the advisory board led by entrepreneurs Elon Musk and Vivek Ramaswamy, the Grace Commission had no authority to implement changes, only to advise.

And after a few years of work, the Grace Commission’s 150-plus members convinced Congress to implement exactly zero of its recommendations.

“You can’t find any evidence that they’ve changed the growth of government one iota,” Douglas Holtz-Eakin, president of the center-right think tank American Action Forum, told CNN. “There are a lot of small examples of success” from the group, he said. “But I think you should ask Elon and Vivek what makes them different from the Grace Commission. How are they different from other things that have failed?”

In 2024, as in 1982, there is broad consensus that the federal budget is bloated and could benefit from a new perspective to make government more efficient and save taxpayer money. Economists on the left and right told CNN they would welcome any good attempt to reduce the deficit and rein in government spending. But so far neither Musk nor Ramaswamy seem to understand the complexity of the $6.8 trillion US budget.

“We always act as if the federal budget is like sitting around the kitchen table and sorting out the family finances,” said Holtz-Eakin, a former adviser to John McCain’s campaign and budget chief under President George W. Bush in 2019 2008. “That’s a lie…It’s a fifth of the economy and it’s very, very difficult to manage and restructure. And that’s what they find out.”

Musk and Ramaswamy face the immediate mathematical challenge of finding a way to significantly cut spending — especially if they commit to the $2 trillion figure Musk has cited.

About 60% of the federal budget consists of so-called mandatory spending – primarily Medicare, Medicaid and Social Security. It would be political suicide to drastically cut funding for these safety net programs, which is why there is no interest in Congress. Trump has promised to protect Social Security.

Another 10% of the budget is spent on paying interest on Uncle Sam’s mountain of debt. Nothing can be changed about that either, at least not without triggering a catastrophic debt default and market collapse.

That leaves about 30% of the budget discretionary – but about half of that goes to defense spending, another area that would be difficult to cut dramatically.

“Reducing $2 trillion in annual spending will be extremely difficult without touching mandatory spending, which would require lawmakers to make the tough decisions they have either been unwilling or unable to make,” wrote Isaac Boltansky , director of policy research at BTIG, in a recent report to clients.

According to Mark Zandi, chief economist at Moody’s Analytics, non-defense discretionary spending has already been scaled back and is at its lowest level as a share of GDP in modern history.

For this reason, Zandi said he is skeptical that focusing on government efficiency can produce positive results even $200 billion a year in annual savings, not to mention $2 trillion. (Musk said in October that he could save at least $2 trillion, but did not specify whether he meant annually or over a period of time.)

“I am fully in favor of efforts to improve government efficiency,” Zandi said. “But there is no game-winning 60-yard touchdown pass here. There will be a lot of one- or two-yard runs.”

In an editorial in the Wall Street Journal last month, Musk and Ramaswamy gave a high-level overview of their vision to “target the more than $500 billion in annual federal spending that is not authorized by Congress or used in ways that are not authorized by Congress.” , which Congress never intended.”

But how exactly?

There is an option, although not always legal, for the president to defy Congress and simply refuse to spend money appropriated by the legislature. It’s called confiscation.

“My risk of DOGE’s recommendations reaching Congress is relatively low,” said Bobby Kogan, senior director of federal budget policy at the Center for American Progress, a left-leaning policy research group. “My threat level for them doing some things illegally and unilaterally is incredibly high.”

Trump has repeatedly said he would challenge the Nixon-era law that limited the president’s ability to block funding for projects approved by Congress. The DOGE brothers are also on board, writing in their commentary that they believe the Supreme Court would likely side with Trump.

A spokesman for the Trump transition team did not respond to a request for comment.

It is not clear what effect a confiscation strategy would have. Newt Gingrich, a former House speaker and Trump adviser, told The Washington Post last month that the administration would likely try a two-pronged strategy: asking Congress to approve drastic spending cuts while pushing limits on its power to unilaterally cut funds. to test out.

For example, if the White House wanted to freeze federal funding for schools with vaccination requirements, as the president-elect has suggested, that move would be challenged in court by the school or local government. It would be up to the courts to uphold or overturn this order, potentially blocking vital resources for months or even years.

“While I think they will probably lose (some cases) in court, that is a very real path to chaos,” Kogan said.

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