It’s not an official government agency and has no power to enact its recommendations. Still, Elon Musk and Vivek Ramaswamy’s Department of Government Efficiency is charged with finding ways to cut America’s $2.8 trillion deficit. Once they do, will anyone listen?
Here’s some advice.
First, act quickly. You have only 12 to 15 months or so from the inauguration date till congress stops being as concerned with your mandate and more focused on their own re-election prospects. The Grace Commission of the 1980’s learned the hard way that no matter an idea’s merits, political self-interest will kill even the best idea, and self-interest is the one mutual concern that unites members of congress. Whatever you’re going to do, do it quickly.
Second, there are any number of government departments that do very little good at an exorbitant cost. From the Departments of Labor and Education to the Federal Communications Commission; government agencies are bureaucratized with layers of fat, red tape, and inertia so that even the good they do is made deficient.
Many government agencies like the Department of Education don’t do much that the states do not already do other than hand out money tied in often hopeless knots of regulation and arbitrary opinion. Eliminate them and send the money directly to the states without strings.
Another example is the $350 million Economic Development Administration which duplicates the efforts of sixty some-odd other development programs. Eliminate it and reorganize all those other development programs into one or two more effective and efficient organizations.
Third, eliminate agencies and departments that have outlived their usefulness. One example is the Corporation for Public Broadcasting, a far-left publicly supported vehicle for advancing a progressive agenda that spends $500 million in public funds annually. If people want the programming they offer, privatize it and sell the rights to commercial broadcasting stations.
Another example is the Public Health Service Commission Corps created in the 19th century to assure merchant seamen received healthcare would save taxpayers some $3.6 billion over five years.
Fourth, take a look at the 14 proposed cuts Adam Michel and Chris Edwards over at Cato have said could reduce federal outlays by as much as $4.8 trillion over 10 years. They suggest $237 billion could be saved by bringing federal retirement benefits into line with private sector benefits. Pulling back the Biden food stamp increases would save $190 billion. Revamping work requirements for able-bodied welfare recipients could save $171 billion. Converting SNAP into a fruits-and-vegetables-only program would save $1 trillion. Banning undocumented immigrants from entitlement programs and welfare could save another $1.3 trillion. Those are just some of the programs that could be reduced.
Finally, repeal the mistitled Inflation Reduction Act. The energy and climate subsidies will cost around $1 trillion by 2032 and up to 4 times more in the subsequent 2 decades. On top of the money we save by repealing the IRA, you will bring markets back into line with reality and limit the wasteful crony capitalism the law exacerbated.
Here’s the bottom line. Our massive debt ($36 trillion) and growing deficits ($2.8 trillion annually), will eventually result in huge spikes in inflation, higher interest rates, and sluggish or negative economic growth.
It’s also true, however, that big cuts will cause big complaints. And it won’t just be progressives. A lot of oxen will be gored. There will be more than enough pain to go around. Those complaints will be fortified by plenty of emotional ammunition with no shortage of heart rending stories about government workers losing jobs they’ve had for years.
Worse still even massive cuts in deficits are not likely to head off the economic reckoning we’re earned with our fiscal foolishness. Reducing deficits and putting our federal budget on the road to balance will certainly reduce the pain and make it shorter-lived, but it is unlikely to eliminate it all together. Recession is nearly inevitable.
The result could well be politically ugly 2026 mid-term elections in which progressives regain control of both the Senate and the House. Their solution to the coming recession will likely be even more government spending and a government grab of various economic sectors. Only President Trump’s administration and his power to veto could prevent progressives rolling back all the gains made in the coming months.
It’s important to remember what’s at stake. If we don’t act now, America is destined for a deep and painful economic reckoning. It will be cruel and long-lasting. However, if a majority in Congress acts courageously to put the future before their own narrow political interests, and advance the best ideas from Musk and Ramaswamy’s work, the damage will be limited and our children saved from the certain consequence of our economic recklessness.
If that is accomplished, America will have even more for which to be thankful.
