How Elon Musk's Department of Government Efficiency could actually work

• The Department of Government Efficiency wouldn't be a department, but an outside advisory group.
• Under current law, Congress needs to approve most budget changes, limiting the DOGE's power.
• Trump has flirted with changing budget laws, but experts told BI that could cause a massive fight.

President-elect Donald Trump on Wednesday announced a new effort to slash what he sees as federal inefficiency, with Elon Musk as cost-cutter-in-chief.

Trump made good on a campaign promise when he tapped Musk to co-lead the proposed "Department of Government Efficiency," or DOGE, alongside former GOP presidential candidate Vivek Ramaswamy.

Musk says he wants to cut $2 trillion from the federal budget to make it more efficient and effective. Beyond that, though, little is known about how the DOGE will function and how much power it — and Musk — will have.

Musk did not respond to Business Insider's request for comment for this article. A representative for Ramaswamy declined to comment.

What do we know about the DOGE?

Despite its name, the DOGE will not actually be a government department, as departments are permanent and can only be created by Congress. Instead, it will function "outside of the government" and disband by July 4, 2026, Trump said in a statement.

The name DOGE is an homage to Musk's preferred cryptocurrency, Dogecoin, which shot up in value after Trump won the election. Under current law, the DOGE might not be able to accomplish much, since Congress controls federal spending.

"They have no power. No power at all," Elaine Kamarck, a senior fellow at the nonpartisan Brookings Institute who led efforts to reform the federal government under former President Bill Clinton, told Business Insider. "They do make recommendations, and once they make recommendations, the expectation is that the government will act on them."

There's no guarantee that a recommendation will turn into a policy, especially given that many of the DOGE's suggestions will likely require congressional approval, Kamarck said.

The DOGE's $2 trillion goal is something of a pipe dream.

Federal spending reached $6.75 trillion in 2024. Multiple experts told BI that it's unlikely Musk will be able to cut his desired $2 trillion without sacrificing programs that have wide bipartisan support or fall under federal mandatory spending, like Medicare and Social Security. Kamarck called the $2 trillion goal the "most unrealistic" part of the whole DOGE plan.

Trump has long been preoccupied with cutting what he sees as Washington's waste and fraud.

"The Department of Government Efficiency (DOGE) will ultimately be staffed and dedicated to this mission," Brian Hughes, a spokesperson for Trump's transition team, told BI in a statement.

Quoting former Rep. Barney Frank, Kamarck said that excess federal spending is "marbled" throughout the budget, like fat throughout a steak, making the DOGE's desired $2 trillion in cuts tricky.

"It just doesn't work, unless you decide to start cutting Social Security benefits or Medicare, at which point all hell breaks loose," she told BI. "And you know, the bromance between Trump and Musk will end very quickly."

Known for streamlining efficiency at his companies, Musk says he wants to cut bureaucracy, shrink the federal workforce, and trim the number of federal agencies down to no more than 99 (there are currently more than 440).

Douglas Holtz-Eakin, the former director of the Congressional Budget Office, told BI that he doubted that the loosely defined group would be able to accomplish much given its sprawling $2 trillion target.

"It is hard for me to get seriously ginned up about it until there's a real structure there that suggests that this makes some sense and has a purpose," he said. "If something is designed to do everything, it will do nothing."

The DOGE will exist "outside of government."

In one scenario, the DOGE could function as an advisory committee, which Trump can create through an executive order. The president-elect said the DOGE will work with the Office of Management and Budget, which prepares the president's budget request for Congress.

"They have made clear that this is a non-governmental department, which is not a familiar term, and so it's not really clear how the organization will operate because of that," Lisa Gilbert, co-president of the progressive nonprofit advocacy group Public Citizen, told BI. "It might be an advisory committee of non-governmental actors, but even from that posture, it won't have the authority to alter budgets or fire employees or rescind regulations."

Kamarck said that there are specific rules laying out how much interaction external committees can have with the government, but it's not clear how Trump, Musk, and Ramaswamy envision the internal infrastructure of the DOGE.

"How are they going to talk to each other? How are they going to meet with each other? Are they going to go talk to anybody in the government, or are they just going to make up things from 50 miles away?" she said.

On November 14, the DOGE said in a post on X that it is seeking "super high-IQ small-government revolutionaries willing to work 80+ per week on unglamorous cost-cutting." Musk said on his personal X account that the positions will not be paid.

Trump has talked about changing a key law that limits his federal spending power.

Trump, Musk, and Ramaswamy may try to circumvent the congressional obstacles standing in the way of their cost-cutting agenda. Last year, Trump expressed interest in going after the Impoundment Control Act, a 1974 provision that requires the president spend funds that Congress has appropriated.

"Bringing back Impoundment will give us a crucial tool with which to obliterate the Deep State, Drain the Swamp, and starve the Warmongers," the president-elect said in a video in June 2023.

Holtz-Eakin said attempting to skirt the impoundment act would be like rewriting history, and Kamarck told BI that any attempt to not spend money that Congress has appropriated poses big Constitutional questions.

"If he tries to change the law so that he can impound funds, my guess is there'll be a fight in the Congress and he'll lose," she said.

Musk could bump up against many conflicts of interest but likely wouldn't have to divest from his companies.

If the DOGE is a federal advisory committee, Musk and Ramaswamy would likely be "special government employees," who are experts or consultants that can work for a federal agency or the White House for up to 130 days. They do not get paid and, crucially, would not have to divest from their companies.

"They've been clear also that they're staying in their roles as the heads of companies and in other places," Gilbert said. "Not being a part of government means they don't have to deconflict themselves."

In a press release for Public Citizen, Gilbert said that Musk's "own businesses have regularly run afoul of the very rules he will be in position to attack" as the DOGE co-lead.

In the role, Musk and Ramaswamy would still be bound to federal ethics laws and have to recuse themselves from conversations that affect them personally, Bloomberg reported. With his companies under investigation from at least 20 federal regulatory agencies and SpaceX having more than $15 billion in federal contracts, Musk could face many such conflicts.

Kamarck said that there's no "firm line" about when employees need to take themselves out of discussions, but that lawyers address questions on a case-by-case basis.

Musk has expressed public frustration with what he views as overbearing federal oversight, which he said has slowed down his pace of business.

By law, meetings of advisory committees, like the kind the DOGE could be, need to be open, and Musk has no problem with the transparency — in fact, he seems to invite it. In a post on X, the billionaire promised to post all of the group's actions online "for maximum transparency" and said the public should chime in with their opinions.

It's also possible the group might intentionally avoid becoming a federal committee because of the increased oversight and scrutiny, Holtz-Eakin said.

"It's not a federal committee as far as I can tell," he said. "I think that's deliberate. If you do that, then you're subject to lots of things like a conflict of interest you have to sign off on, and I think that would be a nightmare for Mr. Musk. And so they're not going to let it tiptoe toward federal jurisdiction."

Until Trump actually forms the DOGE, if he ever does, the legal and bureaucratic details remain murky, and the experts BI spoke with aren't convinced that it will work well.

"It sounds a little screwy, frankly," Kamarck said.