Arc of the Budget Axe
Terry H. Schwadron
Nov. 29, 2024
In interviews, posts and various appearances before friendly audiences, Elon Musk and Vivek Ramaswamy are letting us know they are serious about taking their war against federal bureaucracy “past the realm of memes and viral posts into potential real-world disruption.” as The Washington Post noted.
Since they don’t answer to anyone, their work is less than transparent, and they own or invest in companies that stand to benefit from privatization efforts. But the pair are actively seeking partnering sponsors in the administration and Congress/ They have aligned with Russell Vought, Donald Trump’s pick for the Office of Management and Budget, beseeching like-minded friends in business and put out feelers for people to do the unquestioned work of blowing up federal spending.
Vought, who held this job before, was chief author of the Project 2025 outline to sink the administrative state. And, in the House Rep. Marjorie Taylor Green of Georgia already is publicly identifying NPR and the Corporation for Public Broadcasting as early for the chopping block since they are only arms for “Democratic propaganda.” Her Senate mirror is Joni Ernst of Iowa, who first words on the subject were that her goal was to make the federal establishment “squeal”through massive spending cuts, and she offered consolidating office space, rethinking the penny, and cutting contributions to the United Nations.
It’ll be a long road to two trillion bucks.
At the same time, we’re hearing in various news reports, government analyses, and political insiders that the talk is running well ahead of the action, and that talk of cutting upwards of two trillion in federal spending in a year or in ten years, is not only overblown, but likely beyond what Musk, Ramaswamy, and the invented “Department of Government Efficiency,” DOGE, can deliver. As reporters have noted, it remains unclear how much the DOGE panel will cost or what its source of funding will be.
For openers, critics like Lawrence O’Donnell, the MSNBC commentator, repeatedly note that it is Congress — the group that can’t agree on much more than what time it is — that will have to adopt spending cuts, not Musk and Ramaswamy. Plus, large swaths of the federal budget are required payments on debt, Social Security, Medicare and Medicaid and defense, leaving fewer trillions of dollars available for political beat-up as “waste.” Plus, incoming President Trump has already promised more tax cuts, broadly and specifically, and lots of spending plans on border and deportation enforcement for which there is no current budget.
We’ve seen outside recommendations before, the critics say, and Congress backs down from most of them as politically unwise. What is to distinguish these to-be-determined cuts from previous attempts?
Burn-It-Down Thinking
Already, we’re hearing about some new administrative trickery towards reaching an unidentified goals of unwanted federal spending. But the bigger point here seems to destroy what is in place first and to allow a smaller, regulation- and enforcement-free federal government to grow in its place. It’s a political vision, not a financial review.
Musk is even targeting a few individual federal job holders on his social media X, ridiculing and leaving them open to public attack, presumably to coax them to quit before they are fired.
Musk and Ramaswamy are drawing heat for treating government services as optional, for bringing business-like “hostile takeover” thinking to manning an army or fulfilling requirements for health care. Unlike business, it is not shareholders or market value that will suffer. Poverty will increase, corporate safety efforts will wither, and people will become ill and die.
So, we should be watchful about at their approaches.
First, there will be an attempt to push federal spending to states, as in the case of eliminating the U.S. Education Department, its $82 billion budget and its 4,400 employees. The plan is to make someone else do the work or for it to stop. Either way, what looks at first like a budget cut or a headcount reduction simply will have been moved — unless we want to eliminate feeding kids at school or the equivalent. The long-term cost of losing an educated workforce or for encouraging racism through halting Civil Rights enforcement may not even be part of the calculation.
Second, Ramaswamy has suggested taking advantage of the mistiming between when Congress passes a budget and separately authorized specific programs that match to those limits. He wants to go after any lapsed spending authorizations despite still being funded by Congress, spending that includes veterans’ healthcare services, housing assistance and the Justice Department. It is an approach that misunderstands the process of spending authorization in Congress, but also does not reflect “waste.”
Another version of this is a threat to “impound” spending that Congress has enacted but with which Trump or Musk/Ramaswamy disagree. A post-Watergate Congressional Budget and Impoundment Control Act of 1974 requires the president to spend the money Congress approves. The law allows exceptions, such as when the executive branch can achieve Congress’ goals by spending less, but not as a means for the president to kill programs he opposes.
“They have a fundamentally superficial understanding of what they’re doing,” Bobby Kogan, the senior director of federal budget policy at the Center for American Progress told Salon. “They have a meme-level understanding. ‘Let’s get rid of unauthorized spending’ is the sort of thing that you might see in a Facebook meme.”
In a Wall Street Journal op-ed, Musk and Ramaswamy said they will target $500 billion in spending that is “unauthorized by Congress or being used in ways that Congress never intended.” It is this lag in the two-step congressional approval for check-writing that they are discussing. Any spending will require Congressional authorization; an internal House rule creates a separate process for authorization and appropriations, experts say.
The third bucket of work we should expect from DOGE is actual waste of the sort that we usually hear from bad payments from health programs or pandemic grants. This is ongoing work that truly is time-consuming, often legally complicated, and contested. Undoubtedly this is worth millions if not hundreds of millions of dollars, but you need investigators to find it, lawyers to prosecute it, and lots of paperwork of the exact sort these two guys want to eliminate.
Another source of savings is expected from simply eliminating regulations. If there is no rule, there need be no enforcement. Ask the meat companies who dislike USDA inspections or manufacturers who do not want OSHA reviews of workplace safety. News articles last week discussed airlines lobbying to remove rules for reimbursed cancellations and for the nursing home industry to forgo rules on staffing; deregulation comes at a price. Musk and Ramaswamy, who also do not like or want employee unions, don’t want rules that impede businesses, growth, return on investment and the like.
The question this poses is the safety price or rights of employees and consumers. You get what you don’t pay for in these instances.
Sprinkling in Politics
As an overstatement, the same voices that are calling for radical shifts in federal spending also want spending re-wired for a different set of political aspirations. The examples are not hard to find, but it is never quite clear whether it is the politics driving the financials or the opposite.
Musk and Ramaswamy want to target $535 million allocated to the Corporation for Public Broadcasting, $1.5 billion for “grants to international organizations” and nearly $300 million allocated to “progressive groups like Planned Parenthood” as examples of excess spending that could be cut. Those are not waste; they are political targets. We can understand that a new administration means new priorities. Just don’t label your political cuts as waste.
They will target support for arts and humanities, for climate, for education, for weather forecasting and then move onto health. We should be looking at these with eyes wide open for what is “waste” and what are simply right-leaning political goals. The Planned Parenthood monies are not for abortions, but for reimbursements for health clinic services offered just as any health provider.
When Musk and Ramaswamy target those in jobs dealing with climate control or with diversity and inclusion programs, it is not “waste” but political elimination. They should just say so, and not pretend as if they are “saving” money.
Two-thirds of federal spending is mandatory, while the remaining discretionary spending largely goes toward defense. Over 70% of the nation’s non-interest spending is public benefits to Americans, like Social Security, SNAP, WIC, Medicaid and Medicare. If you cut those programs, you are cutting aid to people who vote.
Of course, Musk could just offer to employ everyone working at NASA at his Space X company that depends on government largesse, but that would be too logical.
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