Eve here. Satyajit Das employs a high-level measurement approach to Doge, highlighting issues that are oddly underrated in American debates. It turns out that approaching government using the same standards as business is wrong. Still, I came to a tough conclusion.
If anything, read that investors in this fortune story “The Big Short,” which predicts the crash in 2008, to make sure DAS is downloading US slide severity, predict that the market is “underestimating” the economic impact of Doge’s mass spending cuts (HAT Tip Resilc). Typical bits:
[Danny] Moses claimed that investors are already beginning to see disruption in consumer trust – last month we saw the sharpest decline in four years – and will continue to hear similar trends in future revenue calls. You’re slowing down, but you haven’t been stabbed by the market yet, he said…
Signs of weakening the economy can be seen in small businesses and “private contractors who currently carry out legitimate work services forced to make decisions about their business,” Moses said.
The government spent about $759 billion on its 2023 contract for prosecutors, an increase of about $33 billion from the previous year, with about $171.5 billion being sent to small businesses, according to the US government’s Office of Accountability. Musk’s own companies have signed a government contract of at least $20 billion.
Doge’s mass cuts are beginning to put key contracts at risk. Accenture CEO Julie Spellman Sweet lost a US government contract to investors on Thursday, which accounts for 8% of global revenue, as part of a Doge review. The consulting company’s share price fell 7.3% after the pension.
That federal government work and contract exclusion produces what Moses surprised the “imaginative cycle.” As Ford’s federal government seeks private sector jobs, opportunities could be reduced as government contract revenue streams shrink.
Satyajit Das: Traders, Guns & Money: Dazzling World of Derivis (2006 and 2010), Extreme Money: The Masters of the Rise and the Cult of Risk (2011), (2022). Hisst Book is about the relationship between ecotourism and human wildlife – Wild Quest (2024). Published in collaboration with New Indian Express Online
Doge, the acronym for the new Doge of US government efficiency, has historically been the highest magistrate of Venice or Genoa. Audio “danger” is defined as dishonest, likely to fail, or causing problems or pain. Doge’s waste reduction plan is being carried out in the imperial way by the multi-skilled super “genius” Elon Musk and could fail with serious side-damages.
Government revenue and spending is around $5.5 trillion and $7 trillion, respectively. Doge is targeting approximately $2 trillion in spending cuts. Actual savings could only be $2-10 billion, but they claim they have cut $100 billion. Eliminating 25 federal employees saves 1% and finishes USAID only 0.6%. Reducing subtle spen extensions requires politically toxic reductions in defense, social security, Medicare/Medicaid, veteran benefits, defense and interest, which make up 75% of federal spending.
The cut ignores the cost of the Doge action. Cancellation of the contract involves completed work and primitive payments. Wahler is fired and will receive payment for his dismissal. At about $100,000 per head, $7.5 billion is the cost of 75,000 employees getting a postponed resignation against an annual saving of $11.6 billion if not replaced.
Plans reduce budget deficits and debt. With extended tax cuts, social security, tips, tax elimination on overtime, and reviving state and local tax credits, Reveues will reduce approximately $900 billion a year. Over the next decade, the deficit could rise from $2 trillion to $3.6 trillion due to increased payments for Social Security, ALDED CARE and healthcare. If five workers once supported all retirees financially, there are now three, but in the end they will be two.
Doge’s corporate restructuring approach misunderstands the public sector’s challenges. While businesses focus on maximum profits and shareholder profits, governments need to balance security, growth, standard of living, justice and value. Companies operate within defined product market structures, selecting and selecting activities. In contrast, governments must manage in complex environments shaped by domestic and foreign factors. Many of them required efficient cooperation across constituencies and countries without control or influence. Many states’ activities are driven by the lack or failure of market-based solutions.
Revenues and stock prices provide a reasonable measure of the impact of business decisions. The success or failure of government choices is less quantifiable as the complex benefits of infrastructure, education and welfare and scholarships can take decades. Doge’s education and research spending reduces the risk of undermining the US’s long-term competitiveness. Companies can avoid the wider impact of desions by reducing their labor force, migrating production overseas, seeking subsidies, and minimizing taxes. The state effectively deals with unemployment, INME OMPORT, retraining, and social damage. There is no such safety net in the government’s decision. Government time horizons must necessarily be longer than those companies follow.
Due to limited accountability, corporate managers exert a wide range of power and control the organization through threats (dysmissal) or rewards (rewards or promotions). Government actions require legislative support, and at least theoretically limited by Powerrs separation, enforcement or governor actions, and international obligations. The government cannot fire legislators and traditionally faces serious barriers to civil servants of compensation or exchange.
Doge cannot already legislate or change its enforcement expenditure authority without passing existing or new laws. Implementation requires negotiations with the party and engineering consensus. Republican lawmakers have found that Doge’s actions are uncommonly unpopular in districts with the authority to vote during their tenure. The court has already begun to allow cancellation of contracts and terminations.
The implementation of government decisions is compliant. Deep domain knowledge is a prerequisite. Doge staff appears to lack the necessary knowledge and understanding of the constitution and law, government accounting, and systems. The reduction in public sector employees could prevent the highly-known tariffs and deportation of governments that are labor-intensive and require extensive documentation.
The factors identified suggest little cost reductions. US government spending reached a new high in February 2025, highlighting this. So, what is the true purpose of the US administration?
One interpretation is that Doge’s actions are theatrical or performance art of surrealism, giving the appearance of achievements, but actually giving the activity to please the President’s MAGA base. Distract from the failures to end the Ukrainian war in 24 hours, lower prices, raise economic activity, improve living standards, and increase wealth.
The other thing is even more worrying. Doge and Musk could become Trojans to dismantle government capabilities and reduce regulatory constraints on businesses. For all of our actions so far, there have been surprisingly weaned groups to take responsibility for surveillance and registration laws. This allows the interests associated with the President to plunder the people. Trump’s families and businesses have already done soothing to monetize their brands, for example, through investments and transactions in cryptocurrency. Continuing business suggests that Doge’s cut could be the forerunner of privatist sub-public services. The parallel of this release was in Russia in the 1990s, when the West pressured an invalid government to sell state assets at bargain prices, bringing profits to suboligarchs.
Elon Musk was not elected and purchased a role in the Enjays Extanaire Authority, with a $250 million campaign contribution and without confirmation from the Senate. Listen to the obvious conflict of interest. He is well listed to maintain and export government contracts for businesses such as SpaceX and X. There was a sub-dodge measure to suspend investigations of mask-related businesses.
Without a strong Congressional resistance and an administration willing to ignore court orders, Doge may show a deeper change – the United States is in a state of strong, wealthy but failing.
