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Is there conclusive evidence on how these cuts are actually going, and how much money is being saved? It’s nearly impossible to navigate the media landscape of propaganda, lies, and hit pieces to really know what the numbers are saying.
Just wait and see what the next budget reports say? See if debt to gdp actually starts falling?
Here is a projection from the CBO (congressional budget office) projecting DOGE to be a massive failure, and note this analysis is from a right wing/libertarian news org so I’d actually give it more credibility: https://www.zerohedge.com/markets/cbo-forecasts-doge-and-ai-will-be-massive-failures-sees-us-debt-exploding-productivity
Unfortunately, according to DOGE's own numbers, it's a lot of "on paper" savings.
From some previous contracting work, I know an unfortunate amount about how Federal procurement works. The DOGE tracker sites I've found have direct links to FPDS (Federal Procurement Data System) pages for very specific contracts. That's good! But the devil is always in the details.
For any given government contract, there is the total lifetime value of the contract and dollars already obligated to it. As a toy example, let's say the Department of Commerce wants to do some general IT upgrade. It does some market research (not really, lol, but, whatever) solicits some bids, reviews proposals, and awards a contract. The total award value may be $500m, $1bn, or even more. But that doesn't mean the contract gets a big up-front payment of $1bn. It means that the Department of Commerce has given itself permission to spend up to that limit on this one particular contract (technically, depending on the contract type and structure, it could be across a lot of smaller contracts and/or task orders, but let's keep things simple for now).
When DOGE lists its numbers, its listing that full $1bn ceiling as the "savings." A few different media outlets tried to Point And Laugh at this, but the reality is that they're wrong as well. For the Department of Commerce (or anyone) to award a contract, they don't necessarily have to already have the budget approved by congress. In the industry, the term "unfunded opportunity" or "unfunded contract" is used in this case. The Government customer has a true need for whatever it says it does and can go through the bid and proposal process - but they have no obligation to actually pay you only because you've won a contract. Now, if you do any work on that contract, that's a different story. The fact of the matter is, unfortunately, that you can have a government contract that is effectively worth nothing even though it says "eleventy billion dollars" on the piece of paper.
Returning to DOGE, that they are canceling contracts and counting the ceiling value of those contracts could or could not be significant. If the agency in question already had their budget approved (and for several of these larger, longer term contracts, it is highly likely that was the case) then this the cancelling of these contracts does in fact save money from a future budget perspective. But it's not necessarily as if DOGE "found" $1bn dollars sitting in a commerce account somewhere and has now repurposed it for the General Purpose America Fuck Yeah account. They've freed up budget room next year and in the years following.
OR, they've cancelled a contract that was unfunded to begin with and so the savings are quite imaginary. It's like if you get an unexpected car repair bill and then mentally "cancel" your beach vacation. Did something happen? Not exactly. And certainly not in a true fiscal sense.
But wait, there's more. Just because a single contract within the Department of Commerce (to stick to my previous example) got cancelled, doesn't mean the agency as a whole won't find a way to reshuffle the budget and retain those dollars. Again, Congress controls the budget and they approve it every year (or, as has been the case for about the past 20 years - I'm not joking - the pass a weird series of CRs or otherwise out of order budgetary actions to sustain the budget as is with some new starts - kind of).
So, when do DOGE cuts get real and sticky? When Congress passes a budget. That's when you'll be able to actually see meaningful money stop flowing to agency / department X,Y, or Z. Until then, it's an on paper "win" (or not, see above) and, because it's happening totally within the executive branch, nothing stops a potential Democrat President in 2028 (or whenever) from flipping the switch in the other direction and directing Department of Commerce (and everyone else) to go ahead and try to get those IT contracts rolling again.
And I think this is part, though not the largest no most important part, of Elon's likely downfall in the Trump 2.0 admin. What he is used to doing in the corporate world is not possible in the Federal Government. The entire reason the founders set the system up the way they did was to make things intentionally hard to coordinate. They split the budget passers from the budget users and the law makers from the law enforces from the law interpreters. They did this because they wanted the default option to be "nothing happens." In the 18th century, this meant Americans were mostly free, then, to run their own lives. But through gradual executive overreach, aided many times by a cowardly Congress, we now have a poor situation in which the Executive kind of gets to do whatever it wants unless Congress or the Courts calls it out.
Very detailed explanation, thanks a lot.
Yeah, and this is why DOGE will likely fail. They will get some culture war cuts and furious headlines, but it’s actually up to Congress to not just pass CR bills that roll over the last budget into a new one. Congress will actually need to sack up and significantly cut outlays. Won’t hold my breath.
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The analysis is from the CBO, Zero Hedge's analysis (I would not put much stock in it, their analysis for years has been that the world is weeks/months away from economic collapse) is that CBO talks bullshit:
Actually I’ve found that the zerohedge in house analysis is pretty accurate (and sensational, but they are in the selling-clicks business). A lot of their reposts and features from different figures like Peter Schiff (long time gold bug) is very doom and gloom.
But also, they’ve been shilling gold for years and now it’s up >50% YoY on one of its biggest pumps ever?
Secondly, doom and gloom doesn’t mean that stocks are going to zero, economy dead. Really we are in a slow motion crack up boom, where runaway government spending moons the currency supply and this pushes home prices, stock prices, and asset prices all to unfathomable highs.
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