A mysterious video has emerged, unveiling significant decisions made by Musk. Several lawsuits have been initiated to challenge the budget cuts being mandated by Trump through executive orders. The issue at hand is that according to the Constitution, the power to approve or eliminate spending lies with Congress, not the executive branch. Despite the Republicans currently dominating Congress remaining relatively silent, this stance may alter as the repercussions of Trump’s cuts start impacting constituents within their own states and districts.
It remains a separate matter altogether to determine whether the act of canceling contracts, selling off real estate, and trimming bureaucratic roles equates to “savings” or an act of recklessness. A substantial portion of federal spending is directed towards citizens through programs like Social Security, Medicare, Medicaid, and veterans benefits. Additionally, a large portion is allocated to defense, with smaller amounts dedicated to fundamentals such as infrastructure like roads and bridges. In comparison, all foreign aid combined constitutes merely 1% of federal spending. The total compensation for roughly 3 million federal workers, excluding the military personnel, stands around $270 billion, which is approximately 4% of the total federal expenditure.
While private-sector companies frequently engage in cost-cutting measures, the key lies in eliminating unproductive or redundant activities to enhance overall performance. However, there are instances where cost-cutting endeavors may go overboard, jeopardizing crucial functions.
The concept of “speed cutting” enters the picture with the meeting between President Donald Trump and Elon Musk at the White House, depicted in a photograph by Alex Brandon from the Associated Press. The ultimate assessment of financial performance by investors determines the trajectory of stocks, with winning stocks witnessing an upsurge in value while the losing stocks face sell-offs.
Though there is no literal “stock” associated with the federal government, there are auditors responsible for evaluating its performance. Entities like the Government Accountability Office, Congressional Budget Office, and individual department oversight divisions serve this purpose. Trump has already initiated repercussions by dismissing 17 inspectors general from agencies such as USAID and the Education Department.
These inspectors general are the individuals tasked with reviewing the type of information being disseminated by Musk’s commission and ascertaining its accuracy. It is plausible that during Trump’s second term, the one agency that may not undergo scrutiny is DOGE itself.
Rick Newman, a senior columnist for Yahoo Finance, provides insights into political news concerning business and monetary policies that are poised to influence future stock prices. Stay updated with the latest financial and business news on Yahoo Finance.
