The math questions behind DOGE's $55 billion savings claim
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Screenshot: Department of Government Efficiency website
The Elon Musk-led DOGE's latest update on an accounting of its cost-cutting measures to date raises more questions than answers: It didn't take long before at least one major error was identified in its receipts.
Why it matters: There is uncertainty about the accuracy of the self-reported audit that could, in theory, make DOGE's moves across the federal government more transparent.
- There are already concerns about the agency's access to databases and private data typically reserved for career staffers.
The big picture: The DOGE website said it canceled a contract for the U.S. Immigration and Customs Enforcement agency — for "program and technical support for the office of diversity and civil rights" — that was purportedly worth $8 billion.
- That is a big contract that alone would all but use up ICE's $9 billion budget.
- The contract was actually worth $8 million, as the New York Times and other publications have pointed out.
The intrigue: DOGE claims that its "total estimated savings" to date are roughly $55 billion. But there are questions about whether that sum is inflated. Bloomberg says the website lists $16.6 billion in savings.
Between the lines: The website accounts for the face value of a contract but does not seem to account for funds that are spread across several years. If some of the money has already been spent, that is money that is not technically "saved."
It is also unclear how cuts in one area might affect government revenue in another.
- Take layoffs at the Internal Revenue Service — rumored to begin as soon as today — that could result in fewer tax collections.
- The Biden administration made the opposite bet: bulking up IRS staff would result in higher collections.
💠Our thought bubble, from Axios' longtime Musk-watcher Joann Muller: Musk's accounting of the litany of accomplishments at DOGE shares a similar lack of specificity with Tesla investor calls.
- He boasts about sales volumes going up or costs going down, for example, but provides very few numbers. Musk makes confident predictions about "orders of magnitude" growth rates that are "insane," with very little to support those claims.
- It's up to investors to dig into Tesla's SEC filings — or, in this case, whatever data DOGE makes public — to get the details.
