Elon Musk’s DOGE Wouldn’t Have Worked Even If It Had Worked

It’s easy to forget that individual saving in no way shrinks consumption. Short of placing money saved into a coffee can, to save is to shift consumptive ability to someone else.

What’s true about individual saving is true about government savings. No act of parsimony shrinks the size of government either. That’s why Elon Musk’s Department of Government Efficiency (DOGE) wouldn’t have worked even if it had worked.

Short of the savings being placed in a much bigger coffee can, government spending cuts born of efficiency, headcount reduction, mandate reduction, or all three would have just freed up money for Congress to spend in new ways. In government as with individual, what’s not spent is shifted to other existing priorities, or much worse, all new ones.

It’s the new spending initiatives that are the most perilous. Most start out small, and this includes Medicare. It’s so easy to forget that it began as a $3 billion program in the 1960s, but is expected to pass $1 trillion in the coming years.

Which speaks to the danger of spending cuts. Talk about “regime uncertainty.” Unfortunate and economy-sapping as much government spending is today, the good news is that it’s a known.

In other words, the myriad ways that Congress politicizes the allocation of precious resources is already priced or factored into our day-to-day existence. That’s not so with new initiatives. Who knows what Congress will dream up, and who knows how what Congress will dream up will end up? To see the peril of this, ask yourself if Congress would have had the votes to pass Medicare if it was known that sixty years later it would yet again be a nearly $1 trillion annual program today.

That’s why without excusing most federal outlays for even a second, when it comes to government the devil you know is better than the unknown. Which is why it’s better to let Congress fight over what’s known and priced, as opposed to freeing it to design all new programs and initiatives from the proverbial studs. They could end up much bigger than they presently are. Logically so.

To which some will reply that what’s been written doesn’t, or wouldn’t have applied to DOGE since any savings wouldn’t free up money as much as the savings would reduce government borrowing. More realistically, it would just free up Treasury to borrow $2 trillion more in the future. With our federal government, no act of not borrowing subtracts from borrowing.

It’s all worth keeping in mind as conservatives in particular lament the failure of the latest gallant, but surely quixotic attempt to shrink the size and cost of government. These initiatives never work simply because in government as with individuals, money saved is never money that’s not spent.