Elon Musk’s cost-cutting efforts face reality check

Despite bold claims, the US government's spending remains largely unchanged

DT,Anna Price·16 February 2025, 9:40 am·1 min read

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Elon Musk’s cost-cutting efforts face reality check — People hold up signs as they protest against US President Donald Trump and Elon Musk's "Department of Government Efficiency" (DOGE) outside of the US Department of Labor near the US Capitol in Washington, DC. Elon Musk has begun swinging his wrecking ball at the US government, with concerns growing over the unprecedented power that President Donald Trump has handed to the world's richest man.
Drew ANGERER / AFP

U.S. government spending remains steady despite Musk’s cost-cutting claims. Daily outlays have averaged $30 billion under Trump, surpassing the same period under Biden.
Source: United States Department of the Treasury

Elon Musk’s self-proclaimed crusade to slash U.S. government spending is making headlines, but official data tells a different story. According to The Economist, Musk’s "Department of Government Efficiency" (DOGE) has so far failed to make a meaningful impact on the federal deficit, despite repeated announcements of cost-cutting measures.

The U.S. Treasury’s daily spending reports show that since Donald Trump’s return to office, federal expenditures have increased rather than decreased. Musk’s claims of saving $1 billion a day remain unsubstantiated, with spending levels in line with previous years. Government outlays have averaged $30 billion per day, exceeding the same period under Joe Biden’s administration.

Structural Limits to Cost-Cutting

The federal budget is largely composed of mandatory spending on Social Security and healthcare, as well as interest payments on debt, leaving only a fraction available for discretionary cuts. Even if Musk’s DOGE program eliminates all estimated government fraud—between $233 billion and $521 billion annually—it would still fall far short of his $2 trillion savings target.

Additionally, many of DOGE’s announced cuts focus on politically charged programs such as diversity, equity, and inclusion initiatives, which constitute a tiny fraction of federal expenditures. Even the controversial closure of USAID, America’s international development agency, would result in just 0.6% savings on the overall budget.

Disruptions but No Major Savings

While Musk’s cost-cutting efforts have led to government layoffs and uncertainty among federal workers, their actual financial impact remains minimal. Armed with an executive order from Trump, DOGE is preparing for mass firings, though legal challenges could slow down or even block the initiative.

Musk insists that reducing federal spending is "essential," but so far, his efforts appear more symbolic than substantial. As The Economist notes, despite Musk’s claims of disrupting government waste, America’s fiscal reality remains largely unchanged.