As expected, President Donald Trump signed an Executive Order on Inauguration Day (20 January 2025), establishing “the Department of Government Efficiency to implement the President’s DOGE Agenda, by modernizing Federal technology and software to maximize governmental efficiency and productivity.” The United States Digital Service was renamed as the United States DOGE Service (USDS), to be set up temporarily until 4 July 2026, within the Executive Office of the President.
The Administrator of the USDS, as yet unnamed, will lead the President’s 18-month DOGE agenda. Tech billionaire Elon Musk, although not official administrator, has been granted “special government employee” status, as a senior adviser to the federal government, albeit with “no actual or formal authority.” He is not working alongside tech entrepreneur Vivek Ramaswamy, as originally envisaged. A number of DOGE teams, of at least four employees each, will be attached to the various federal agencies being targeted. As part of their data-driven investigations, DOGE officials have requested direct access to Treasury payment systems, the Integrated Data Retrieval System (IRDS) which contains Internal Revenue Service (IRS) accounts and tax returns data, as well as Social Security numbers and bank account information.
Donald Trump was elected on a platform of cuts to federal government spending, dismantling of the federal workforce, and a war on alleged federal fraud-all to reduce the federal fiscal deficit and ensure better use of taxpayers’ money. A “bloated” federal government may indeed have arisen over the years by a process of bureaucratic creep, across federal 438 agencies and sub-agencies, and some rationalisation of expenditure and updating of IT system was almost certainly required. Federal government spending in FY 2024 was $6.75 trillion, almost a quarter of GDP. The budget deficit for this period was $1.83 trillion- the difference between expenditure and $4.92 trillion raised in government revenues. Looking at the bigger picture, the US national debt, which represents accumulated fiscal deficits and surpluses, has reached $36.22 trillion. As of April 2024, $7.9 trillion (22.9 per cent) of this sum was held by foreign governments, central banks, companies, and individual investors, making the US the largest external debtor in the world.
The DOGE project is reported to have arisen as a result of discussions between Elon Musk and Donald Trump, and has been inspired by the work of the Ministry of Deregulation and State Transformation in Argentina. Government spending consists of mandatory spending, discretionary spending, and interest payments on debt. The three major sources of expenditure in FY 2024 were defence ($883.7 billion in fiscal year 2024), healthcare ($144.3 billion in discretionary and $1.7 trillion in mandatory spending for FY 2024), and social security ($1.5 trillion in 2024)
Some agencies have been earmarked for restructuring, downgrading, or closure, including the US Agency for International Aid, the Consumer Financial Protection Bureau, the Department of Education, and the Small Business Administration. Other targets include the Department of Energy, the Department of Veterans Affairs, the Centers for Disease Control and Prevention, the Food and Drug Administration, the National Institutes of Health, the US Forest Service, and the Federal Aviation Administration, among others. In the case of the National Nuclear Security Administration, layoffs appear to have been somewhat premature and not well thought out. Only agencies responsible for public safety, immigration enforcement, and law enforcement are being spared in this wide-ranging purge.
Budgets have been slashed and recruitment put on hold. Across the board, federal DEI (diversity, equity, and initiatives) contracts have been terminated. On 8 January, over two million permanent federal government employees were sent buyout offers. Around 40,000 federal employees have voluntarily left their jobs in exchange for full pay through September. For those who have not taken up this offer, the cull has begun. Some employees have been placed on administrative leave, often at short notice, while others have received termination letters alleging “poor performance.” Mass terminations of probationary employees have taken place. Job losses are expected to have an impact on social security, health care, education, natural resources and environment, transportation, and other areas of federal government activity. The human costs of this process, often painful, have yet to be quantified. Meanwhile, investigations of the Social Security Administration are said to have revealed widespread fraud. On 11 February, Trump even claimed that DOGE had identified “tens of billions” of “waste, fraud and abuse.”
The inevitable challenges by states and federal judges, and public protests have followed. Meanwhile, the transition to a leaner and meaner federal government continues unabated and at a fast pace. There is nothing left for outside observers but to sit back and await the outcomes of this latest American flirtation with a smaller state.
Ashis Banerjee