Behind the Curtain: Hard truths about Trump budget cuts

Why it matters: Their proposed cuts are but drips of water in America's overflowing bucket of debt — $36 trillion and counting. In fact, most days, America racks up more interest on its debt — $3 billion per day! — than DOGE can find in savings. That leaky bucket is the reality of your nation's finances.

This column is our attempt to clinically outline the facts about deficits — and efforts to reduce or eliminate them.

The big picture: Trump and Musk are correct that America is drowning in deficits. Some of it flows from silly spending on stale or even stupid programs. Those make for terrific X dunking: Agencies with more software licenses than employees! A $324,671 USDA grant for "Increasing DEIA Programming for Integrated Pest Management"! A $3 million Education Department contract "to write a report that showed that prior reports were not utilized by schools"!

• But trimming fat is harder than it looks: 37% of the contract terminations on an initial list on DOGE's "Wall of Receipts" (417 out of 1,125) weren't expected to save any money, usually because it had already been spent.
• And the only way to truly reduce the deficit is to target the very programs Trump refuses to touch — defense, Medicare, Medicaid and Social Security. They account for 86% of the budget.
• That's reality for a country that, across Democratic and Republican administrations, has spent taxpayer money without restraint or care about debt. This is one area where everyone is guilty.

Musk and DOGE suck up a lot of attention for doing what former Sen. Alan Simpson (R-Wyo.) did by needling "the boneheads of both parties," and the late Sen. William Proxmire (D-Wis.) did with his Golden Fleece Award: highlighting the need for radical change, and the absurdity of many U.S. programs. Even Musk critics should applaud him for getting the public to pay attention to massive bugs in the federal system.

• But the Trump team is also using the guise of budget-cutting to eliminate jobs or areas they disagree with — or that undermine their ambitions. To date, most of the proposed cuts fall into this bucket.
• In doing so, they're also usurping the power of Congress — which, under the Constitution, sets U.S. spending priorities and budgets. That's producing court fights.

📊 State of play: The idea of DOGE is popular: A poll released yesterday by Harvard's Center for American Political Studies and The Harris Poll found 72% of U.S. registered voters polled online support the existence of a federal agency focused on efficiency.

• Jamie Dimon, JPMorgan Chase CEO, told CNBC in Miami on Monday that while any "bureaucracy pushes back on everything," DOGE "needs to be done," and should be "not just about the deficit. It's about building the right policies, procedures and the government we deserve."

So Trump and his aides correctly calculate that both the cuts and the tales of government insanity are popular with the vast majority of Americans. Even if the reality isn't quite as sexy:

• No, tens of millions of dead people aren't getting Social Security checks. That's a known computer coding quirk that wasn't fixed because of the cost.
• No, DOGE didn't save $8 billion on a contract by Immigration and Customs Enforcement (ICE). The New York Times Upshot discovered that DOGE was hanging its hat on an earlier database error that had been corrected to say $8 million. $2.5 million had been spent — so canceling the contract saved $5.5 million at most.
• No, the U.S. didn't send $50 million worth of condoms to Hamas, as Trump said on-camera. "That's a LOT of condoms," Musk joked. In fact, the International Medical Corps was providing medical and trauma services in Gaza, including family planning programming and emergency contraception.

Reality check: Of the roughly $7 trillion the U.S. spent in 2024 (as calculated by Axios chief economic correspondent Neil Irwin)...

• 60% went to mandatory programs — including Social Security, Medicare, Medicaid, veterans' benefits, unemployment insurance and SNAP (Supplemental Nutrition Assistance Program).
• 13% went to defense.
• 13% to interest payments.
• 14% for discretionary spending — leaving Trump not quite $1 trillion.

So when you consider where federal money really goes, most DOGE oddities and outrages amount to rounding errors in a sea of government obligations.

By the numbers: Earlier this month, Trump promised on Truth Social: "BALANCED BUDGET!!!" Here's what would have to happen to deliver that, according to nonpartisan and academic experts:

• You'd need to eliminate roughly $2 trillion just to make up for the current deficit projection, plus interest on our existing debt.
• That'd mean massive cuts to Social Security, Medicare, Medicare and defense.
• There's also the question of how many times you can spend the same dollar. Trump says he wants tariffs to balance the budget — but he also wants them to eliminate income taxes. And "DOGE dividend" checks would send savings back to taxpayers instead of helping dig the country out of this hole.

The backstory: Trump is handcuffed by political reality and his own statements.

• He was elected on the promise of tax cuts. Those cuts likely would create even bigger deficits, at least in the short term.
• "Social Security won't be touched," Trump told Fox News' Sean Hannity two weeks ago. "Other than fraud or something we're going to find it's going to be strengthened but won't be touched. Medicare, Medicaid, none of that stuff is going to be touched."

Case in point: House Republicans have vowed to cut Medicaid in the budget bill that would pay for Trump's tax cuts, border security buildup and other priorities.

• But Steve Bannon pointed out on his "War Room" podcast: "A lot of MAGA's on Medicaid ... Medicaid is going to be a complicated one. Just can't take a meat ax to it, although I would love to."
• Michael Tuffin, CEO of AHIP, which represents health insurers, contends that disrupting Medicaid coverage could raise costs elsewhere and weaken chronic-disease prevention.
• We told you over the weekend about the testy town halls that House Republicans are facing back home. One of them, Rep. Rich McCormick (R-Ga.), told CNN's Manu Raju on Monday that the GOP could do a better job of showing "compassion": "I think we have to have really good conversations between the DOGE and Congress [about] the impact on people who have real consequences for their families."

What they're saying: Administration officials say Trump already has disrupted more in 37 days than most experts thought was possible. That is true. But most of the past month's wall-to-wall coverage has focused on bites that wouldn't add up to the meal that he's promised.

• Musk told Hannity: "If we don't solve the deficit, there won't be money for medical care." So Musk, who has spent his career defying bearish predictions, is now working his greatest puzzle of all.

The bottom line: Neil Irwin reminds us of the old line that the U.S. government consists of a military attached to an insurance company. In big-picture terms, that's pretty true.

• Go deeper: DOGE math questions, by Axios' Neil Irwin and Courtenay Brown.