Elon Musk’s DOGE Disaster Will Likely Cost Taxpayers Nearly 4 Times More Than It Cut

Elon Musk’s tenure at DOGE is supposedly winding down. If you’ve been watching Fox News or one of the many even more ridiculous pro-Trump propaganda networks, the world’s richest man’s brief tenure in government has been a paradigm-shifting triumph.

By any objective measure, however, it has been a dismal failure. Hundreds of thousands of federal workers have lost their jobs, agencies have been rendered essentially inoperable, and thousands of adults and children are dying abroad because of canceled medical aid.

All this destruction was supposed to be in the name of reigning in federal spending. Musk originally stated a goal of cutting $2 trillion in federal spending, which he later reduced to $1 trillion. Today, the grand total DOGE claims to have saved American taxpayers is $160 billion. Not only is this less than a tenth of Musk’s original target, it is likely a gross exaggeration as it is impossible to independently verify given that DOGE is not very explicit in explaining how it arrives at its figures. Also, DOGE has been repeatedly caught double-counting, over-counting, and seemingly making up many of its savings numbers.

Even if you take DOGE at its word that it has cut $160 billion in federal spending, a new estimate from a nonpartisan research group found that those cuts will cost taxpayers $135 billion in this fiscal year alone from rehiring mistakenly fired workers, lost productivity, paid leave costs, and other inefficiencies in the Department of Government Efficiency’s way of doing business.

Significantly, the $135 billion figure does not include the expense of defending against the many lawsuits challenging DOGE’s antics, nor does it include the lost revenue caused by DOGE’s massive staff cuts at the IRS. Funding at the IRS has been meticulously studied over the years. For every dollar spent by the IRS, between $5 and $12 is recovered by the agency.

When the IRS is focusing on higher earners, the returns are even more significant. A nonpartisan report from the Government Accountability Office found last year that every additional hour dedicated to auditing the tax returns of extremely wealthy taxpayers saved the government $13,000. Thanks to DOGE, the IRS unit responsible for auditing billionaires has lost approximately 40% of its workers so far this year.

It is difficult to know exactly how much DOGE’s cuts at the IRS are going to cost U.S. taxpayers, since a significant portion of the lost revenue is going to result from rich taxpayers’ perceptions of how much additional cheating they will now be able to get away with. That being said, credible estimates put the ballpark figure at $500 billion this year alone.

Just to sum that up, we are looking at about $135 billion in transaction costs for DOGE’s actions so far, and perhaps $500 billion in lost tax revenue this year, plus a ton of litigation costs to be determined and a drastic reduction in services. Which means that even if you give DOGE the benefit of the doubt as to the accuracy of its figures, and stick to conservative estimates, we just spent $635 billion plus to save $160 billion all while putting hundreds of thousands of people out of work and causing uncountable numbers of deaths abroad.

Everyone agrees that there are things that the federal government could and should do more efficiently. Everyone also agrees that there are many ways in which the federal government wastes money, like, for instance, by paying Tommy Tuberville’s salary or dropping a $60 million fighter jet off the side of an aircraft carrier.

But DOGE has not made government more efficient, and it won’t reduce government spending either. DOGE will cost American taxpayers something in the neighborhood of four times more than it cut in the first year alone.

DOGE will make it easier for big businesses and rich Americans to cheat on their taxes — never mind that around six in 10 Americans think corporations and wealthy people should pay more in taxes rather than less. DOGE will also make it harder for all the agencies hit by its cuts to do their jobs.

So, if you are a very rich person who wants to cheat on his taxes and exploit workers without fear of intervention by pesky federal regulators, DOGE has perhaps accomplished a lot for you. For everyone else, Elon Musk’s time at DOGE has been a disaster.

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Jonathan Wolf is a civil litigator and author of Your Debt-Free JD (affiliate link). He has taught legal writing, written for a wide variety of publications, and made it both his business and his pleasure to be financially and scientifically literate. Any views he expresses are probably pure gold, but are nonetheless solely his own and should not be attributed to any organization with which he is affiliated. He wouldn’t want to share the credit anyway. He can be reached at [email protected].