Larry Summers says DOGE is going to end in a 'disastrous failure'
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- Larry Summers said on the All-In Podcast that DOGE is wreaking havoc on US institutions.
- He pointed to the administration's targeting of the Internal Revenue System.
- The former treasury secretary said the outcome could put the US into further debt.
Former Treasury Secretary Larry Summers said DOGE will end in a "disastrous failure," possibly leading the US into a deeper deficit.
Summers said on an episode of the All-In Podcast posted on Friday that he generally agrees that the US government could be more efficient.
"I think we need much more reform," he said, agreeing with New York Times columnist Ezra Klein, another guest on the show. "I think Democrats have allowed themselves excessively to become hostage to particular groups, particular traditional concerns, and have lost touch in important ways with the American mainstream."
Summers said, however, that the current administration and DOGE are wreaking havoc on American institutions and surmised that they would fail to solve the problems they're trying to address, such as the national debt.
"My best judgment is that this project is going to end in disastrous failure despite having put its finger on some important concerns and issues," he said. "Of course, there should be much more aggressive reform of the government than there is. But that does not excuse or mean that it is likely to work out well for some of the mindless savagery that the DOGE is bring to traditional American institutions."
He pointed to the White House's targeting of the Internal Revenue System. In February, the administration moved to slash the IRS's workforce and, more recently, gave employees deferred resignations and buyout offers.
The economist said that attacking the tax collection agency could result in a revenue loss exceeding any savings that DOGE realized.
"We are firing, en masse, people whose job it is to audit people like you," Summers said to All-In Podcast host Chamath Palihapitiya, who pushed back on the economist's argument. "And the result of that is that we are losing revenue directly."
Paliphaitiya responded that he gets automatically audited yearly and that the government owed him $1,000 in 2024. That suggests the venture capitalist is fairly careful with his tax returns, considering the multiple revenue streams he may have.
Summers said he did not doubt Paliphaitiya's "personal integrity" but added that "less than a quarter of people with incomes over $10 million are audited."
Summers has previously criticized the Trump administration's aggressive approach to economic reform. On X, he called President Donald Trump's "Liberation Day" tariffs highly costly and "masochistic."
"This is dangerous work with a sledgehammer on a pretty sensitive machine — which is the global economy — that's having really serious consequences," Summers said on the podcast.
A White House spokesperson did not respond to a request for comment.