Deep Dive
Shownotes Transcript
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Hey, everyone. Welcome back to the Elon Musk podcast. I'm thrilled to share some exciting news with you. Over the next two weeks, we're evolving. We'll be broadening our focus to cover all the tech titans shaping our world. You'll still get the latest insights on Elon Musk, plus so much more. So stay tuned for our official relaunch coming soon. Now let's get into this episode. The number is staggering. $200 billion.
That's what Elon Musk's doge claims it has saved the American taxpayers since President Donald Trump returned to the White House. But one unavoidable question now grips anyone hearing the claim. How much of it is real? How much is smoke and mirrors? And what evidence is there behind these extraordinary figures?
Question that matters deeply because the size of the claim implies a government overhaul of historic proportions, reshaping where billions of dollars flow every single month. Now, if Doge's numbers are even mostly true, it would suggest an era of unprecedented fiscal tightening. And if not, it raises concerns about transparency and accountability at the highest levels, understanding the reality behind these claims
It's not just a matter of curiosity, though. When Elon Musk introduced Doge shortly after Trump's inauguration, the concept was simple, get aggressive, cut waste, eliminate bloated spending, and cancel unnecessary projects left over from past administrations.
The problems were huge. The scope is large, and its ambitions are clear. Qatar gets contracts, grants, and federal leases, while also aiming to slash fraud and trim the government workforce. Doge has positioned itself as the muscle behind Trump's push to overhaul Washington's spending habits. Now, Doge publishes a running tally of its reported savings
on its official website, where it claims to have reached $160 billion in savings as of April 20th. Yet only about 40% of that figure is broken down into specific transactions that can be independently reviewed. Analysts from the BBC Verify took a closer look at these numbers and found serious gaps in documentation and evidence supporting these claims.
Now, in October of last year, Elon Musk raised eyebrows when he pledged to cut at least $2 trillion from the federal budget. However, the goal was later scaled down. By April 10th, Musk was speaking about aiming for about $150 billion in savings by the end of 2026, concentrating efforts on reducing fraud,
and waste. That's a huge difference. Now, the revised figure still represents an immense amount of money, though, especially considering federal budget for the last fiscal year was $6.75 trillion. Now,
We pulled some data directly from Doge's site on April 23rd and examined the reported savings from canceled contracts, grants, and leases. The findings reveal that approximately half of the itemized savings had a corresponding document or some form of cited evidence. This leaves a substantial portion of claimed savings essentially undocumented. Moreover, scrutiny from U.S. media revealed mistakes within Doge's accounting altogether. For instance,
The agency had boasted about an $8 billion saving from canceling an immigration contract, when in reality, the contract's full value was only $8 million. Now, Doge acknowledged the errors and stated that they're working to upload all necessary receipts and documentation in a digestible and transparent manner. Now, currently, receipts accounting for only about 30% of total savings are available,
with some listed as unavailable for legal reasons. Now, understanding how Doge calculates its savings is key to evaluating its claims, though. Many savings figures are based not on actual expenditures that were stopped, but on projected maximum contract values extending years into the future.
The contracts often list an upper spending limit, not an actual or expected expense. The real costs are only tallied after the contract is actually completed. Now, a close examination of Doge's four largest claimed savings reveals discrepancies between the numbers in reality. These four savings supposedly added up to $8.3 billion dollars.
However, when comparing the available documentation and consulting experts, the actual figures appear far lower. The biggest individual saving, Doge claims, is $2.9 billion from canceling a facility construction contract intended to house migrant children in Texas. The contract, signed during the Biden administration, had a scheduled end date of 2028.
Yet it was reviewed annually, meaning there was no guarantee of full renewal. And according to a source, the $2.9 billion figure was based on speculative maximum figures that would never have been realized. The actual immediate saving from halting the contract was closer to $153 million, not $2.9 billion. Now, operational costs were $18 million per month,
and the site never reached its intended maximum occupancy. In the second case, Doge claimed to save $1.9 billion by canceling a contract between the IRS and an IT company, which is Centennial Technologies. Now the linked FPDS document showed a maximum value of $1.9 billion, but reported $0 in actual spending so far.
Now, this doesn't necessarily mean that no money was spent, as government departments often delay updating expenditure and contract databases. Furthermore, the CEO of Centennial Technologies told the New York Times that the deal was already terminated during the Biden administration before Doge could take credit for canceling it.
A third largest saving listed by Doge involved canceling a $2.4 billion IT services contract with A1 Fed Impact for the Department of Defense.
Doge claimed $1.76 billion in savings from this cancellation. However, again, there is no evidence of any spending against the contract at the time it was terminated. It remains unclear how Doge calculated the $1.76 billion figure, and neither the Pentagon nor the contractor has provided any clarity on this matter. And they should know. They were part of it. Now, the fourth claim.
large savings here. 1.75 from Doge canceling USAID grant to Gavi, an international health organization that works to improve vaccine access. According to USAspending.gov, linked page confirmed that $880 million had been paid to Gavi in three installments during the Biden administration. And their spokesperson,
said that they were unaware of any termination notice. Without confirmation from USAID, it remains a mystery how Doge arrived at its $1.75 billion saving figure.
Now, the credibility of Doge's reporting savings matters because these claims are being used politically to justify sweeping changes to federal departments and budgets. When savings are exaggerated or poorly documented, it undermines public trust and raises questions about how government reforms are being communicated to the public. And for everyday Americans, the operations of Doge have real-world effects.
Cutting federal spending can impact everything from government services, health programs, and infrastructure projects. The grants for research and also education too. A misleading theme
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"Misleading claims of cost savings could mask reductions in essential services that millions depend on." And moreover, if DOJA's figures continue to be presented without any solid evidence or data, it could erode the standard of accountability the citizens expect from federal agencies. Transparency in spending and in cuts is crucial for ensuring that the government acts responsibly with public money.
And beyond the practical impact, the political ramifications are equally important. Musk's leadership of Doge has become a central symbol for Trump's return to a smaller government platform. Inaccurate or exaggerated figures risk providing critics with ammo to attack not only Musk, but the broader political mission behind it, and also Trump.
Doge has done extensive work. Don't get me wrong. And according to its site, it's reviewing thousands of contracts, grants, and leases with a goal of trimming operational expenses across all departments. But if the documentation does not keep pace with the claims, its credibility could suffer irreparable damage. But it's worth noting that cutting government spending at the scale that Doge claims
would be an almost unprecedented achievement. Historic efforts to slash federal budgets, such as during Reagan, often took years and encountered strong political resistance. Attempting to achieve hundreds of billions in cuts within months raises logistical and bureaucratic challenges that cannot be glossed over. Now, adding to the skepticism are Musk's shifting targets for savings. Going from a $2 trillion target
to just $150 billion in a matter of months suggests that even within Doge, there's uncertainties. Elon didn't look at the data before he made the claim. And as an engineer, you never underproduce and overpromise. There's uncertainties about what is achievable from Doge now. Now, further complicating matters,
The cancellation of contracts often carries hidden costs, such as penalties for early termination, legal challenges, or the need to renegotiate future contracts at higher prices.
DOJA's reported savings do not appear to account for these potential side effects. And another layer of complexity comes from the nature of government contracts themselves. Many contracts are written with future contingencies in mind. Simply canceling a contract that had not yet been fully activated does not always equate to an immediate budget reduction despite appearances.
Several watchdog groups have called for an independent audit of DODA's reported savings. Such a review would likely require months of detailed analysis, contract by contract, grant by grant, before producing a reliable figure. And until that happens, the exact amount saved remains uncertain.
As of now, the official Doge site lists $160 billion in estimated savings. But with less than half of those savings traceable to public documents and multiple examples of accounting discrepancies, we don't really know what's going on behind the scenes at Doge.
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