Elon Musk is a showman, not an accountant
Analysis by Allison Morrow, CNN
New York (CNN) — It’s important, in any political environment, to triage the things you’re freaking out about.
Allow me, as someone whose livelihood depends on chronicling the goings-on of megalomaniacal billionaires, to offer some guidance:
Donald Trump asking Elon Musk to oversee a made-up government “department” named after a crypto token that’s based on a 14-year-old Shiba Inu meme might be concern No. 874 out of 1,000 on a list of things keeping me up at night.
Put simply: Musk is the world’s wealthiest person. And he wants to remain the world’s wealthiest person. To do that, he’s got to keep up the role of the eccentric genius sidekick to Trump’s strongman in the White House.
In case you missed it: The president-elect on Tuesday said that Elon Musk and Vivek Ramaswamy, a two-bit pharma-bro-turned-right-wing-conspiracist, will lead a new “Department of Government Efficiency.” In trademark Muskian fashion, “DOGE” is an unsubtle nod to the memecoin he has spent the past several years hyping into a $60 billion asset (a market cap that eclipses the value of companies like Ford and United Airlines despite having no discernible use case or tangible product).
The goal is to “dismantle Government Bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure Federal Agencies,” Trump said in a trademark Randomly Capitalized Statement on his Truth Social site.
Here’s why it’s a very silly plan: Elon and Vivek are showmen, not accountants, and this “department” is not a department but rather a commission that would operate outside the government. (A department has to get authorization from Congress, and it’s not clear that even a fully Republican Congress wants anything to do with this.) They can advise on spending all day, but only elected lawmakers will have the power to actually make the cuts.
In announcing the commission, Trump said that DOGE would become “potentially, ‘The Manhattan Project’ of our time.”
And 15 minutes later, Musk weighed in on X with a less dramatic but more believable proposition: “Department of Government Efficiency. The merch will be 🔥🔥🔥”
If you need more evidence of how silly this whole thing is, note (as many commentators did online) that the efficiency department is being overseen by two people.
“DOGE is a toothless committee formed to make a few billionaires feel important,” wrote Gordon L. Johnson II, CEO of GLJ Research and a prominent Musk critic and Tesla short-seller, in a note. “It seems clear, once again, Mr. Musk has made promises that are mathematically impossible … (and) has no idea how the appropriations process works.”
Secretary of Over-promising
Of course, all of it is textbook Musk, the technoking of bold promises that have never come to fruition (like street-operational Robotaxis, fully autonomous driving, the ability to put humans on Mars by 2024, etc).
And his newfound obsession with government “efficiency” is almost certainly going to wind up on the list of projects that he can’t deliver on.
It’s not that he won’t have time — he’s managed to keep Tesla shareholders happy despite his many distractions, like turning Twitter into a far-right propaganda machine and reportedly building a sprawling compound in Texas for his 11 children and their mothers. (Musk has denied reports of a compound.)
On the campaign trail last month, Musk was asked how much he thought he could cut from the nation’s $6.5 trillion budget.
And like anyone who’s gone out ahead of their skis, he grasped for an answer that seemed believable: “Well, I think we could do at least $2 trillion,” he said.
Two trillion. At least. Because everyone knows the federal government is bloated and inefficient and it’s long past time to tell those fat-cat civil servants in DC to get a real job … Except, that’s not how the budget works.
Some quick numbers: Last fiscal year, the US government spent a total of $6.1 trillion, according to the Congressional Budget Office. Of that total, $1.7 trillion was “discretionary” spending — the kind that Congress has to greenlight each year, covering everything from military outlays to veterans’ health care and federal worker salaries. The rest of the budget covers spending on entitlement programs like Medicaid and Social Security, and interest payments on debt.
To get even close to excising $2 trillion from the budget, the DOGE bros would have to persuade Congress to slash defense spending, lay off federal workers and gut programs that maintain roads and bridges.
Musk would be lucky to find $200 billion in the federal budget, former Treasury Secretary Larry Summers said at the Economic Club of New York on Tuesday.
And adding to the chorus of sound reasoning at that event, Glenn Hubbard, an economist and former dean of Columbia University’s Business School, said: “It’s just mathematically impossible to find $2 trillion.”
Bottom line: Musk owns six different companies, wholly or in part, but his primary job, lately, is being the president-elect’s hype man. Even Trump joked to House Republicans on Wednesday that he can’t get rid of Musk, a source in the room told CNN. “He loves Mar-a-Lago,” Trump said.
That appears to be a winning strategy for the world’s richest man to ensure he stays the richest man — a status that depends largely on Tesla’s market value, as CNN’s David Goldman writes.
Shareholders don’t appear to mind Musk’s political side gig: Tesla’s stock has surged 31% since Election Day, because investors believe that Musk’s influence in Trump’s government will usher in an era of deregulation that will benefit the company. And that means Musk himself, as Tesla’s largest individual shareholder, is $55 billion richer today than he was a week ago.
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