The Journal. - DOGE: The Plan to Downsize the Government

Episode Date: December 4, 2024

President-elect Donald Trump has proposed radically downsizing the federal government, and two of his allies are going to be in charge: Elon Musk and Vivek Ramaswamy. WSJ’s John McCormick walks us through the plans for DOGE, or the Department of Government Efficiency. Further Reading: - Musk, Ramaswamy Want Federal Workers in the Office Full Time. There’s a Hitch.  - Vivek Ramaswamy’s Marching Orders: Cut Trillions for Trump  Further Listening: - Uncovering Elon Musk's Secret Political Donations  - The Scramble Is on to Fill Trump’s Cabinet  Learn more about your ad choices. Visit megaphone.fm/adchoices

There's a word that's been kicking around the internet for years. You're Doge? What are you talking about? Doge. D-O-G-E. It's a term that started to go viral in 2013, and it's often paired with a picture of a cute dog, a Shiba Inu with golden fur and beady black eyes. Then as a joke, Doge became a cryptocurrency, Dogecoin.

Take a look at Dogecoin, it is at more than 900%. The cryptocurrency that started off as a joke is no longer a laughing matter. Now, Doge has gone beyond the realm of memes and cryptocurrencies and into the government. It's the name of a new project created by President-elect Donald Trump. And it stands for the Department of Government Efficiency. Trump plans to use this new doge to slash regulations, reduce federal spending, and cut federal jobs. And Trump says he wants to achieve all of this in less than two years.

They really want to gut the government. That's our colleague John McCormick. What they're proposing here is so audacious that even if they manage to get 10% of it done, it would be a huge change to the size of the federal government and sort of the role of the federal government. If they're able to pull this off, it would be an absolutely huge victory for Trump and conservatives in general. I mean, this is the sort of change

that they've been dreaming about, you know, for decades. MUSIC Welcome to The Journal, our show about money, business and power. I'm Kate Leimbach. It's Wednesday, December 4th. MUSIC Coming up on the show, I'm Kate Leinbach. It's Wednesday, December 4th. Coming up on the show, Trump's plan to radically downsize the federal government.

At New Balance, we believe if you run, you're a runner, however you choose to do it. Because when you're not worried about doing things the right way, you're free to discover your way. And that's what running's all about. Run your way at newbalance.com slash running. Two of Trump's key allies are going to lead the new Department of Government Efficiency. Billionaires Elon Musk... This is crazy. So we've got this suffocating, this vast suffocating federal bureaucracy that just gets bigger every year.

And Vivek Ramaswamy. I believe that if an agency should not exist, it deserves to be shut down. Ramaswamy founded a biotech company. He also ran to be the 2024 Republican presidential nominee. He dropped out in January and quickly endorsed Trump. Rameswamy brought a lot of attention to the idea of shrinking the government. Here's John. This was something that Rameswamy talked about on the campaign trail a lot,

that the government has become too big, it is no longer reflective of the wishes of Congress, the wishes of the people. And he argued that, you know, really 75% of the federal government should be eliminated. Yes, that is severe. And the number of federal employees in the Washington, D.C. bureaucracy

shut down redundant agencies that should not exist. Among the federal agencies, Rameswami's called for eliminating or significantly reorganizing were the Education Department, the Federal Bureau of Investigation, the Internal Revenue Service, the Center for Disease Control and Prevention, the Nuclear Regulatory Commission, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. He argued that they have outsized their role, that they have taken sort of liberties upon themselves to advance what he says is the administrative state. These ideas aren't new. Republicans have long called for a smaller federal government, arguing that more power should be at the state and local level.

And joining Ramaswamy is Musk, who's also a vocal critic of federal regulations. He feels that government regulation has gotten in the way of innovation, including with some of his own companies, that things just take too long to get approved through the government, that it's slowing down innovation, that the economy could be moving at a much more rapid clip if there wasn't so much government in the way. And Musk gets credit for coming up with the name Doge. Back when Doge was just a cryptocurrency, he hyped it up.

Then last month, Musk suggested it as the name for this new project on Joe Rogan's podcast. Yeah, I mean, quote whatever you want. What do you wanna call it? I mean, I think the funniest name is DOG, the Doge, the Department of Government Efficiency. What Musk wants from DOGE has echoes of what he did after buying Twitter. When he took over what used to be known as Twitter in the fall of 2022, he announced

that there would be significant downsizing of that company. Twitter employees have a difficult decision to make. In a recent internal email sent by new owner Elon Musk, employees have until 5 p.m. today to commit to extremely hardcore work or leave the company. He basically said, if you don't want to like insanely work hard and do exactly what I tell you to do, please leave. And I think they're going to give a similar message to federal employees. Just a few days after winning the presidency,

Trump announced the creation of the Department of Government Efficiency. In his statement, Trump called it, quote, the Manhattan project of our time, comparing it to the World War II era program that developed the atomic bomb. That's maybe a little bit over the top in terms of a description, but they want it to

be radical and I think they're going for sort of that kind of shock value that they want this to be that dramatic. How are they recruiting people? They're recruiting people on X and saying, if you want to, you know, be part of this mission and work your fanny off for, you know, about 18 months, come join us in this mission to downsize the federal government. And they have said that their workers will have to volunteer. Oh. I think we're talking, you know, dozens or certainly not more than a couple hundred, which, you know, by federal government standards is pretty teeny tiny and almost nonexistent.

A teeny tiny team with a massive undertaking. And they'll face a lot of resistance. That's next. At New Balance, we believe if you run, you're a runner. However you choose to do it. Because when you're not worried about doing things the right way, you're free to discover your way. And that's what running's all about. Run your way you like them.

Three strips of naturally smoked bacon and a side of toast. Only $6 at A&W's in Ontario. Experience A&W's classic breakfast on Now, dine in only until 11 a.m. So what exactly is DOGE? Is it actually a government department? No, it really isn't a government. It has department in its name, but it's not really going to be a government department. It's going to exist outside of the federal government. And what authority does DOJ have?

DOJ does not have any authority of its own at all. It can make recommendations. Again, it's outside of the government. Any major changes would have to be approved by Congress and certainly any changes to the budget, which is ultimately Congress you know, Congress's responsibility would have to be approved. And trying to get anything past there is going to be challenging.

Regardless, this doge has lofty ambitions. It wants to reduce the federal government and its $6.75 trillion budget as a way to reduce taxes and rein in spending. But a lot of the federal spending may be hard to cut. Interest payments on national debt can't be missed. And most of the federal budget is spent on entitlement programs, including Medicare and Social Security.

And Trump has said he won't touch those. Musk and Ramaswamy recently wrote an op-ed in the Wall Street Journal where they lay out what they plan to do. A combination of cutting staff, eliminating entire departments, and slashing some federal regulations. Now some of those regulations are maybe really important things in our society to keep vaccines safe and keep nursing homes properly scrutinized. So, you know, all of this will have significant ramifications if it really comes to pass. Are those actual examples of things that they're targeting? Well, I mean, I think we don't know exactly what they're targeting, but I think Rameswamy and Musk both feel there are too many environmental regulations, too

much government overreach when it comes to almost everything that the government does. So again, we don't have specifics yet from this oversight commission, but I think just about anything could be on the table. Could it be potentially beneficial for their business interests? Like, is there a kind of conflict of interest potentially here? Yeah, there's huge potential for conflict of interest. Maybe there are things that are going to help Musk's electric

vehicle business that could move more quickly if the government wasn't involved. His SpaceX efforts. So there's going to be huge potential for conflicts of interest. A spokeswoman for Ramaswami said that the team is, quote, committed to making sure all DOGE activities are conducted properly. In their op-ed, Musk and Rameswamy also call for mass headcount reduction and say DOGE wants to comb through federal agencies to figure out, quote, the minimum number of employees required.

One way they hope to reduce the federal payroll is eliminating remote work. One of the first things they plan to do is suggest that all federal workers be back in the office five days a week. And Ramaswamy has guessed, estimated that, you know, that will result in a quarter of the federal workforce, you know, dropping out immediately, which he would applaud. Federal employee unions are gearing up to fight back. The National Federation of Federal Employees,

which represents 110,000 workers, has been consulting with its legal team and plans to lobby members of Congress. Musk and Rameswamy have some other ideas, too, like moving certain government agencies out of Washington, D.C. And John says conservatives have long bandied about this idea. They say, OK, does it make sense to have the Department of Agriculture in Washington, D.C.? Or should we move it to Des Moines, Iowa,

a state that was very central to President Trump's presidential ambitions and has gone increasingly red in recent years? And if they did move the Department of Agriculture to Des Moines, they could pay workers a lot less. The cost of living is dramatically lower in Des Moines than it is in Washington, DC. But getting all this done may be challenging, because a lot of the big ideas for Doge will

need congressional approval and are almost certain to face legal challenges. Is there anything they can do through executive action? Yes. I mean, Trump can do some things through executive action and he almost certainly will. I think this calling, you know, workers back to the workplace full time will be one of the first things that he does as an executive action. But he can't really say I'm moving the Department of Agriculture to Iowa because Congress would have to approve spending for construction of a new Department of Agriculture

in Iowa. And if Ramoswami and Musk succeed, how deeply will these changes be felt by everyday Americans? If these recommendations were truly to succeed, these changes would be deeply felt by Americans. There would be, you know, potentially an IRS that no longer has enough people to perform regular audits. You might have a Department of Education that no longer exists, that states would have to sort of do all of their own educational coordination. Have you ever seen something like this before?

No, there's never been anything this dramatically proposed before. There have been commissions during the Reagan years to study the size of the federal government, but nothing that has been so, you know, dramatic in what's being suggested here. It seems like it is the conservative dream, a smaller federal government. Absolutely. I mean, this is very much, has long been a dream of conservatives. It would be an absolutely huge victory. That's all for today, Wednesday, December 4th. The Journal is a co-production of Spotify and The Wall Street Journal.

Additional reporting in this episode by Justin Layhart and Richard Rubin. Thanks for listening. See you tomorrow.