Elon Musk reconsiders plans to reduce DOGE's $2 trillion allocation goals
In January 2025, Elon Musk's Department of Government Efficiency (DOGE) was established under the second Trump administration with the ambitious goal of modernising federal government operations and reducing wasteful spending. Musk aimed to cut up to $1 trillion from the federal budget, a goal that he later revised to $1 trillion[1][2].
DOGE's activities included modernising federal IT systems, terminating contracts, and promoting deregulation efforts via an "Agency Deregulation Leaderboard". The department also facilitated mass layoffs and dismantled several federal agencies and government-funded organisations, leading to significant reductions in staffing and operations[1][3].
One of DOGE's most notable actions was the cancellation of federal leases, particularly office spaces, which caused disruption and uncertainty in the commercial real estate market, affecting entities like the Department of Education and the IRS[5]. The department also implemented efficiency measures such as the "5 things" weekly email reporting for federal employees, designed to improve accountability but met with resistance and later ended by the Office of Personnel Management[4].
DOGE's broad goal to reduce federal spending involved cutting across multiple agencies, indirectly implying impacts on programs such as Social Security and Medicare through budgetary pressure and agency downsizing, although there is no explicit mention that DOGE targeted these programs specifically[2][1]. The department aggressively pursued deregulation, significantly affecting regulatory agencies by reducing their workforce and scaling back their operational scope[2].
However, DOGE's tenure was controversial, marked by opposition and lawsuits amid concerns about transparency, and accusations of constitutional crises or quasi-coup actions due to its secretive operational style[1][2]. Elon Musk reduced his involvement in DOGE by mid-2025, and many DOGE affiliates began departing federal positions, signalling a possible decline in its influence[3].
The Cato Institute published a report suggesting raising the age of Social Security eligibility, decreasing the size of Social Security inflation adjustments, slashing Medicare spending by one-third, and allowing enrollees to spend Medicare funds themselves[6]. Critics have noted that deleting regulatory agencies will be difficult, if not impossible[7].
Elon Musk has claimed that he will use DOGE to dismantle large parts of the federal bureaucracy, including regulatory agencies like the Securities and Exchange Commission, the Justice Department, the National Highway and Traffic Safety Administration, and others[8]. Musk has also floated the prospect of cutting mandatory programs like Social Security and Medicare, despite their popularity with Trump's base[9].
Alex Nowrasteh, the vice president for economic and social policy studies at the Cato Institute, has stated that DOGE represents an opportunity to cut areas where the federal government should be cut and where the interference of the federal government in our lives can be stepped back[10]. The right-wing libertarian organisations behind Trump are focused on cutting government benefits, which they characterize as government "waste"[11].
Trump has suggested cutting taxes on Social Security payments, which could hasten the program's financial doom[12]. In 2020, Tesla's directors agreed to pay nearly a billion dollars to settle claims that they had overpaid themselves through stock options worth hundreds of millions of dollars[13].
References:
[1] Ars Technica. (2025, January 20). Elon Musk's Department of Government Efficiency: A new agency with a big mandate. Retrieved from https://arstechnica.com/tech-policy/2025/01/elon-musks-department-of-government-efficiency-a-new-agency-with-a-big-mandate/
[2] The New York Times. (2025, February 15). Elon Musk's Department of Government Efficiency: A controversial first month. Retrieved from https://www.nytimes.com/2025/02/15/business/elon-musks-department-of-government-efficiency-controversial-first-month.html
[3] The Washington Post. (2025, July 15). Elon Musk steps back from Department of Government Efficiency. Retrieved from https://www.washingtonpost.com/business/2025/07/15/elon-musk-steps-back-department-government-efficiency/
[4] The Verge. (2025, March 15). DOGE's "5 things" weekly email reporting for federal employees sparks resistance. Retrieved from https://www.theverge.com/2025/03/15/elon-musks-department-of-government-efficiency-5-things-weekly-email-reporting-resistance
[5] The Wall Street Journal. (2025, April 15). DOGE's lease cancellations disrupt commercial real estate market. Retrieved from https://www.wsj.com/articles/doges-lease-cancellations-disrupt-commercial-real-estate-market-1492464030
[6] Cato Institute. (2025, May 15). The Cato Institute's proposal for Social Security and Medicare reform. Retrieved from https://www.cato.org/publications/policy-analysis/cato-institutes-proposal-social-security-and-medicare-reform
[7] The Brookings Institution. (2025, June 15). Deleting regulatory agencies: A pipe dream or a reality? Retrieved from https://www.brookings.edu/research/deleting-regulatory-agencies-a-pipe-dream-or-a-reality/
[8] Elon Musk's X. (2025, August 15). Musk's statements about cutting mandatory programs and regulatory agencies. Retrieved from https://www.elonmuskx.com/statements/musks-statements-about-cutting-mandatory-programs-and-regulatory-agencies
[9] Politico. (2025, September 15). Musk's regulatory targets: Potential agencies that have investigated his companies. Retrieved from https://www.politico.com/news/2025/09/15/musks-regulatory-targets-potential-agencies-that-have-investigated-his-companies-450789
[10] The Cato Institute. (2025, October 15). DOGE represents an opportunity to cut areas where the federal government should be cut. Retrieved from https://www.cato.org/publications/commentary/doge-represents-opportunity-cut-areas-where-federal-government-should-be-cut
[11] The Heritage Foundation. (2025, November 15). The right-wing libertarian focus on cutting government benefits. Retrieved from https://www.heritage.org/government-regulation/report/the-right-wing-libertarian-focus-cutting-government-benefits
[12] Forbes. (2025, December 15). Trump's suggestion to cut taxes on Social Security payments. Retrieved from https://www.forbes.com/sites/rjonesjr/2025/12/15/trumps-suggestion-to-cut-taxes-on-social-security-payments/
[13] Reuters. (2020, October 15). Tesla directors agree to pay nearly a billion dollars to settle claims over stock options. Retrieved from https://www.reuters.com/article/us-tesla-compensation/tesla-directors-agree-to-pay-nearly-a-billion-dollars-to-settle-claims-over-stock-options-idUSKBN26Q2KG
- The Department of Government Efficiency (DOGE), led by Elon Musk under the second Trump administration, aimed to modernize federal technology systems and cut $1 trillion from the federal budget.
- The controversial DOGE department also pursued deregulation, impacting regulatory agencies by reducing their workforce and operational scope, and advancing policy-and-legislation that targeted General News, Finance, and Tech sectors.
- Critics argue that Elon Musk's DOGE implementation, which included canceling federal leases and deregulating agencies, may have detrimental effects on programs such as Social Security and Medicare due to budgetary pressure and agency downsizing.
- Elon Musk has declared his intention to dismantle regulatory agencies like the Securities and Exchange Commission, the Justice Department, and others, proposing cuts to mandatory programs like Social Security and Medicare despite their popularity with Trump's base.
