Photo by Executium on UnsplashAnyone with an ounce of common sense knew that wasn’t possible. He won’t find $1 trillion either.
The New “Epic” OutcomeThe New York Post reports Elon Musk concedes DOGE unlikely to find $2 trillion in budget cuts — but here’s what would be an ‘epic outcome’
Billionaire Elon Musk has walked back a prior claim that his vaunted blue ribbon commission on government bloat and inefficiencies would be able to slash the roughly $6.75 trillion annual federal budget by $2 trillion.
Musk, 53, explained that the $2 trillion goal he floated on the campaign trail was merely the “best-case outcome” and admitted that he believes there may only be a “good shot” at achieving just half of that.
“I think we’ll try for $2 trillion, I think that’s like the best-case outcome,” Musk told Stagwell CEO Mark Penn during an X Spaces conversation. “If you try for $2 trillion you have a good shot at getting $1 [trillion].
“So that, I think, would be an epic outcome.”
Yes, That Would Be EpicThe “new” epic outcome would require cutting $1 trillion out of $1 trillion in discretionary non-defense spending or cutting defense spending that Trump wants to dramatically increase.I have seen people claim discretionary spending is$2.774 trillion, but they arrive at that nonsensical number by labeling $889 interest on the debt as discretionary.Not defaulting is in fact the number one priority.
Cutting $1 Trillion Out of $1 TrillionMusk says that if we aim for $2 trillion we have a chance for $1 trillion. Why not aim for $6 trillion and settle for $3 trillion?No matter. Let’s presume DOGE can cut $1 trillion by aiming for $2 trillion.Voila! The entire non-discretionary non-military budget is now zero.
Reflections on Discretionary Spending CutsThe U.S. Immigration and Customs Enforcement (ICE) budget for fiscal year (FY) 2025 is $9.7 billion, the budget for Homeland Security is $64.8 billion, the budget for the FBI is $11.3 billion, the budget for the justice department is $37.8 billion and the budget for national intelligence is $73.4 billion.Those items total $197 billion. Trump also wants more for the wall and mass deportations. Trump may need another 10,000 ICE agents even if his goal is a modest one to two million deportations.Q: Wait a second Mish, didn’t you cut those expenses totally?
A: Yes. I cut 100% of discretionary spending.But some of those are areas where Trump wants to increase discretionary spending.
Can DOGE Cut $2 Trillion Out of $1 Trillion?On December 27, I asked the seemingly nonsensical question Elon Musk concedes DOGE unlikely to find $2 trillion in budget cuts — but here’s what would be an ‘epic outcome’
The answer to the first question is obvious. So let’s discuss what’s reasonable.
Unlike DOGE, I did balance the budget but it took some hard work.I threw away Trump’s majorly expensive TCJA extension, cut military spending, and assumed a near-miraculous $630 billion in DOGE cuts (or other revenue increases wherever DOGE failed).I will revise my proposal with more details as soon as I can find some more time.More By This Author:Nonfarm Payrolls Rise 256,000 In December; Unemployment DecreasesBiggest Drop In Revolving Consumer Credit Since The Great Recession Bonds Hammered: Is It Fed Policy, Trump Policy, Or Both?
