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Put another way, Musk and Ramaswamy are not tasked with spending taxpayer money. They have been charged with saving it. Their goal is to recommend $2 trillion in spending cuts, or nearly 30% of the federal budget. That’s more ambitious than some of DOGE’s predecessors, such as the Grace Commission under Ronald Reagan or the Al Gore-led Reinventing Government initiative under Bill Clinton (though the Simpson-Bowles commission under Barack Obama dabbled in entitlement spending cuts).

“Together, these two wonderful Americans will pave the way for my Administration to dismantle Government Bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure Federal Agencies,” President-elect Donald Trump said in a statement. The announcement also quoted Musk as saying, “This will send shockwaves through the system, and anyone involved in Government waste, which is a lot of people!”

It took until 1987 for the federal budget to reach $1 trillion. The federal government has already spent more than $1.25 trillion in fiscal 2025, which began in October. In the previous fiscal year, Washington spent $6.75 trillion. The budget deficit was $1.8 trillion in a time of relative peace and prosperity, with the pandemic receding into memory, up 8% from the previous year. The national debt now exceeds $36 trillion.

To put this in perspective, all these figures are much higher than they were during the anti-deficit third-party candidacies of Ross Perot in the 1990s or what gave rise to the Tea Party movement in the 2010s. And yet deficits, debt, and the overall size of the federal government were a trivial part of the 2024 campaign at best.

Swimming in this vast ocean of red ink and massive spending, there is certainly plenty of waste: pork barrel projects, procurement nightmares, earmarks, and dubious construction projects. Citizens Against Government Waste, a venerable conservative group, published in October recommended cuts it said would save $377 billion in the first year and $5 trillion over five years.

At the same time, a focus on “waste, fraud, and abuse” can often be a sign of unseriousness when it comes to fiscal discipline. Of the $6.1 trillion the federal government spent in fiscal 2023, $3.8 trillion went toward mandatory spending programs such as the big entitlements Social Security and Medicare. All this spending grows on autopilot outside the standard congressional budgetary process, making it exceedingly difficult to cut. A large pork barrel project might cost $10 million.

Yet, there are plenty of signs that Trump’s DOGE pointmen are eyeing bigger changes than terminating the occasional federal study on the effects of cow flatulence. “A band of small-government revolutionaries will save our nation,” Ramaswamy vowed. Musk has similarly said he is dedicated to “ensuring that maniacally dedicated small-government revolutionaries join this administration.”

The two entrepreneurs have solicited the input of outside advisers. One is former Texas congressman Ron Paul, a strikingly libertarian Republican who served 12 terms in the House, twice sought the GOP presidential nomination and won millions of primary votes, and was the 1988 Libertarian Party nominee for president. Paul would drastically shrink the size and scope of the federal government. Paul, who is also the father of the senior senator from Kentucky, kept a sign on his desk in his Capitol Hill office: “Don’t steal — the government hates competition!”

Though widely seen as a Trump imitator, Ramaswamy arguably ran the most libertarian campaign for the 2024 Republican presidential nomination. He proposed “deleting” entire federal agencies and subjecting federal workers to mass layoffs.

“The reality is the adviser class from the D.C. swamp has convinced Republican presidents from Reagan to Trump that they can’t reorganize the federal government or lay off large numbers of federal employees without congressional permission or within federal regulations,” Ramaswamy told NBC News ahead of a speech to the Trump-aligned America First Policy Institute in Washington, D.C., last year. He said the swamp adviser class’s view of what a Republican president can do to cut the federal workforce is “wrong.”

Musk, a former Democrat, is a more recent convert to techno-libertarianism. He has been sharing videos of the legendary free-market economist Milton Friedman calling for the abolition of multiple Cabinet-level federal agencies. “Milton Friedman was the best,” Musk posted on X, the social media website known as Twitter until he bought it.

While most Democrats want nothing to do with DOGE, pointing to Musk’s lucrative government contracts, some progressives have tried to turn Trump’s team on to defense budget cuts. It’s the biggest slice of discretionary spending. The Pentagon has failed seven straight audits. But this will divide congressional Republicans, many of whom believe the country’s existing defense spending commitments are insufficient to deter China and other global threats.

This has been the dilemma faced by every Republican president since Reagan: There is limited appetite for cutting the biggest domestic spending programs while rebuilding the military and cutting taxes. Starting with George W. Bush, it became easier to simply boost defense spending and cut taxes without worrying about the red ink. But Bush inherited a budget surplus. Trump, who previously governed during a pandemic, will return to the White House in a time when the federal government runs $1 trillion annual deficits when there is no crisis, other than perhaps a debt crisis, at all.

At some point, however, it will become difficult to keep cutting taxes and investing in national defense as interest payments on the debt become a progressively larger slice of the federal budget. Trump has proposed ideas such as no taxes on tips that will possibly grow the electoral constituency for lower taxes, but these tax cuts will have no real Laffer curve effect. Even under dynamic scoring, they will be projected to be big revenue losers.

These are the obstacles ahead of Musk and Ramaswamy. DOGE can’t cut any spending by itself. It needs Congress to act on its recommendations. Republicans have slim majorities, especially in the House. Only a subset of GOP lawmakers have proven especially interested in significant spending cuts. Trump has never been a big government cutter himself, though he told some Republicans on Capitol Hill during his first term he would look more closely at the budget once safely reelected.

Trump courted the Libertarian Party during the 2024 campaign, helping to hold its presidential nominee to fewer than 1 million votes for the first time in 16 years. But he also promised federal coverage for fertility treatments, expressed openness to an increase in the federal minimum wage, and swore off cuts to Social Security and Medicare. Trump has distanced the GOP from Paul Ryan-style entitlement reforms and brought more downscale voters into the party’s electoral coalition.

That raises the question of whether Trump has any real mandate to cut spending, as opposed to securing the border. But the consequences of federal overspending contributed to Trump’s election in one important, if indirect, way: inflation.

Inflation hitting a 41-year high during President Joe Biden’s term was a powerful reminder that there are real consequences to federal spending exceeding our desire to pay for it with direct taxation. High consumer prices hurt the working class as surely as any broad-based tax increase and are much harder to bring down. It was under these economic conditions that support for the Democrats declined and Trump pulled off what is arguably the greatest political comeback in U.S. history.

Trump signed into law stimulus spending bills that were also inflationary. (Biden lamented that he should have followed Trump in putting his name on the checks.) But Biden’s American Rescue Plan was enacted as the lockdowns were coming to an end and after trillions of dollars had already been spent. Bidenomics proved too costly.

Biden still defends his approach as growing the economy from the bottom up and the middle out, caricaturing his opponents’ economic policies as “trickle-down.” Yet Biden is old enough to remember that it was inflation that broke the New Deal-Great Society consensus 40 years ago, ushering in 12 years of Republican presidents. Democrats have won the White House multiple times since then but never fully recovered.

Trump may be leading the GOP toward rethinking some of its old ideas about limited government, making DOGE something of a throwback. But no less than Reagan in 1981, this time, inflationary spending made it possible for him to wield political power in the first place. Musk and Ramaswamy have as important a mission as any Trump appointee next year.

W. James Antle III is executive editor of the Washington Examiner magazine.