The Actual Math Behind DOGE’s Cuts
If you thought Elon Musk was really trying to cut costs, you weren’t in on the joke.
(Published in The Atlantic)
In November, when Donald Trump first announced his plan to place Elon Musk in charge of a new Department of Government Efficiency, the idea was widely written off as a joke. Then Trump took office, and DOGE began its very real stampede through the government. As an effort to meaningfully reduce federal spending, however, DOGE remains wholly unserious.
Musk initially promised that he would eliminate $2 trillion of the $7 trillion federal budget, before scaling back his ambitions to $1 trillion, and then $150 billion. Even that revised target is highly improbable.
Precisely measuring the budgetary effects of the Musk experiment remains difficult, but we can begin by looking at the claims made by DOGE itself. In late February, its website claimed to have achieved $55 billion in annual-spending reductions. However, its “wall of receipts” detailed only $16.5 billion of this total. Half of that figure came from a typo claiming $8 billion in savings from terminating an $8 million contract. As The New York Times has reported, that was far from the only accounting error. Once such mistakes as false contract cancellations, triple counts of the same reform, and the inclusion of contracts that expired decades ago were fixed, verified budget savings stood at just $2 billion.
The DOGE website now claims $165 billion in savings. However, it still details only a fraction of the supposed cuts, and earlier accounting errors have given way to new ones. A common sleight of hand is canceling a “blanket purchase agreement”—in which the recipient had been given the equivalent of a credit limit to incur necessary costs on a project—and then claiming savings of the full credit limit rather than the (in many cases substantially lower) amount that was actually spent. Even assuming that the website’s stated savings have become twice as accurate as they were in February, annual savings would reach perhaps $15 billion, or 0.2 percent of federal spending.
Fortunately, more reliable sources than DOGE’s self-reported figures exist. The best is the Treasury Department’s monthly accounting of spending by agency and program. Any true DOGE spending reductions should show up in these budget totals, as should the results of other White House initiatives, including cuts to public-health spending and the ongoing efforts to eliminate USAID and the Department of Education.
These spending data do not flatter the Musk project. Total federal outlays in February and March were $86 billion (or 7 percent) higher than the levels from the same months a year ago, when adjusted for timing shifts. This spending growth—approximately $500 billion at an annualized rate—continues to be driven by the three-quarters of federal spending allocated to Social Security, Medicare, Medicaid, defense, veterans’ benefits, and interest costs. These massive expenses have been untouched by DOGE’s focus on small but controversial targets such as DEI contracts and Politico subscriptions.
We can see this by looking at Treasury’s breakdowns of monthly spending by agency. Short-term program spending can fluctuate greatly, and sustained trends might not be fully apparent for several months, but the early data are nonetheless revealing. Perhaps the highest-profile cuts under the Trump administration so far have been to public-health spending and foreign aid. And yet, even here, the numbers are rounding errors in the context of the federal budget. Public-health spending, previously about $8.2 billion monthly, fell to $7.1 billion in March, led by cuts to the National Institutes of Health and the Health Resources and Services Administration, the latter of which funds state and local health grants to serve underprivileged families.