علي طنطاوي

Elon Musk and the Department of Government Efficiency (DOGE) had initially set their sights on slashing $2 trillion in the US federal budget. The number was amped up to $4 trillion after Musk and his team accessed the Treasury and saw how “wasteful” the government expenditure was. However, looking at the numbers, it might still not be enough to positively affect the US debt.

Let’s put aside the question of whether Musk’s efforts are legal. What about national debt? Even by tackling one problem at a time, the billionaire himself admits how there’s “terrifyingly” too much to do with so little time. 

The Debt Clock is terrifying https://t.co/vULgdgiBgn

— Elon Musk (@elonmusk) February 12, 2025

Reducing the budget deficit would likely require either significant tax hikes or deep reductions in costly federal programs, including Medicare, Medicaid, Social Security, and defense spending. These areas account for the bulk of government expenditures, and Washington has historically been reluctant to make major cuts. 

President Donald Trump, who has backed Musk’s cost-cutting initiatives, has also said these programs are “untouchable.” 

Will DOGE be able to cut the budget? Yes, but not as much as those worried about national debt would want.

The growing deficit and national debt

According to official notes from the US Treasury, federal spending is divided into two categories: mandatory and discretionary. The majority of spending is classified as “mandatory,” meaning funds are automatically allocated each year without requiring congressional approval. 

Discretionary spending, which lawmakers must approve every fiscal year, accounts for less than a third of the budget. That’s exactly where DOGE can step in, whether it will be enough to stop the “bleeding” is a whole other tale. 

In fiscal year 2024, the federal government spent $6.75 trillion while collecting only $4.92 trillion in revenue, 68% of it coming from taxpayers. This resulted in a $1.83 trillion deficit that the government has to borrow by selling Treasury bonds and other securities to cover “expenses.” Over time, as interest accumulates and new borrowing occurs, the national debt account grows fatter and fatter.

As of early 2025, the US national debt stands at $36.22 trillion. The Congressional Budget Office projects that it will rise by more than $20 trillion over the next decade, driven primarily by rising costs associated with an aging population. 

And much to our surprise, Trump’s fiscal policies, including military expansion and over $7 trillion in tax cuts, will more than likely push the budget up.

Countries all over the world spend more than they have, and even though America’s GDP tops almost everyone’s, the nation still has to borrow. That only means one thing: debt will still go up.

Debt ceiling already reached, whats next

On January 21, the Treasury Department officially hit its debt ceiling, meaning it could no longer borrow additional funds. While some may see this as a sign of fiscal restraint, the reality is more complicated. 

Former Treasury Secretary Janet Yellen declared that the country had entered a “debt issuance suspension period,” effectively using accounting maneuvers to continue meeting obligations.

To keep the government operational, Yellen has resorted to “extraordinary measures,” such as suspending investments in federal retirement funds like the Postal Benefits Fund (PSRHBF) and the Civil Service Retirement and Disability Fund (CSRDF). 

These funds are typically used to support retired government employees, but in times of fiscal emergency, they are diverted to cover immediate government expenses. Even though this practice could provide a much needed relief, it does not address the underlying issue of excessive government spending.

Experts would tell you that government waste contributes to the budget imbalance, but eliminating it alone will not bridge the deficit. Wasteful spending is estimated to amount to tens of billions of dollars annually, but this figure pales in comparison to the trillions required to close the budget gap.

“The real money is in Social Security, Medicare, defense, veterans’ benefits, and interest payments on the debt, which few people want to touch,” said Brian Riedl, a senior fellow at the Manhattan Institute, a center-right think tank. “Anyone can point out easy, small examples of government waste, and, while bad, they’re essentially budget dust in the grand scheme of our soaring deficits.”

Even if Musk’s department manages to eliminate government inefficiencies, and that’s a big if, it would barely make a dent in the $36 trillion the US needs to “payback.” 

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