It's Pretty Easy to Cut $2 Trillion From the Federal Budget, Actually

The federal workforce used to be huge. In 1960, federal employees were 4.3% of all US workers; today, it’s 1.4%. Zeroing out the entire federal payroll would save $271b/year (while beaching the US economy!), a mere 4% of the federal budget.

On the other hand, zeroing out the budget for federal contractors would save over a trillion dollars – the US spends 4 times more on private sector contractors than it does on its own workers, and while some of those contractors are honest folks giving good value for money, the norm is for federal contractors to pick the public’s pocket and then use the proceeds to lobby for more fat contracts.

One key job we ask our federal employees to do is root out private sector fraud in federal contracting. We should hire more of these people! Private contractors steal $274b/year from the public purse [according to the GAO]– nearly enough to pay for all the employees in the federal government.

If Musk wanted to run DOGE as a force for waste-elimination, he wouldn’t be attacking the Corporation for Public Broadcasting and PBS (whose budget accounts for 0.012% of federal spending). He wouldn’t be attacking federal fiber subsidies (he’s mad that he can’t get more subsidies for his dead-end satellite service that caps out at one ten-millionth of the speed of fiber). He wouldn’t be attacking high-speed rail (which competes with his Tesla swasticars). He wouldn’t be fighting with the SEC (which defends the public from costly stock swindles, which is why they’ve been investigating Musk for seven years).

He could, instead, go after private sector Medicare waste. 33 million seniors have been suckered into switching from federally provided Medicare to privately provided Medicare Advantage. Overbilling from Medicare Advantage (whose doctors are ordered to “upcode” patients to generate additional bills) costs the public $83b/year.

Lambert here: But now “Big Balls” is going after Medicaid. Odd.

DOGE is wildly unpopular with the American electorate – even large pluralities of Republicans think its stupid. Campaigning on cutting fraud and profiteering would be a wildly popular way for Democrats to separate themselves from Republicans. Few Democrats are rising to the occasion, though.