We Need to Dodge the DOGE

There are better, smarter ways to improve government

The plan for the Musk/Ramaswamy Department of Government Efficiency [DOGE] is bad. CORRECTION: There is no real plan yet.

OK. The outline of a plan that we have is a design for wasteful spending, chasing into trivial rabbit holes, and coming up with a lot of stupid recommendations, even if it also comes up with some good ones.

The two designated leaders are somehow supposed to find enough time between now and July 4, 2026 to identify maybe $2 Trillion in cost savings for the U.S. government. Doesn’t Musk have other important commitments, like running all these companies? And won’t Ramaswamy have to take some time if he wants to become governor of Ohio?

Can Musk even get a security clearance to look at any of the billions of dollars being spent on highly classified activities? He reportedly has a Top Secret clearance that doesn’t include the most sensitive secret programs, but his Space X company has repeatedly violated the rules.

No problem, they say. They are gathering volunteers who can do the detailed work – although no Democrats will be allowed to work in DOGE.

We are assisting the Trump transition team to identify and hire a lean team of small-government crusaders, including some of the sharpest technical and legal minds in America. This team will work in the new administration closely with the White House Office of Management and Budget. The two of us will advise DOGE at every step to pursue three major kinds of reform: regulatory rescissions, administrative reductions and cost savings.

The first part sounds good – getting rid of burdensome regulations. This should be happening all the time. But there are rules for ending regulations, just as there are for creating them. [See the Administrative Procedure Act.] The trouble comes in evaluating the burdens of compliance with the benefits of the regulation. We want safe food and drugs without having every package inspected.

The rest of the DOGE effort is obsessively fixated on cutting people and budgets. The DOGE leaders wrongly believe that government agencies should be sized according to their regulations, and cut if regulations are reduced.

President Trump has asked the two of us to lead a newly formed Department of Government Efficiency, or DOGE, to cut the federal government down to size.

A drastic reduction in federal regulations provides sound industrial logic for mass head-count reductions across the federal bureaucracy. DOGE intends to work with embedded appointees in agencies to identify the minimum number of employees required at an agency for it to perform its constitutionally permissible and statutorily mandated functions. The number of federal employees to cut should be at least proportionate to the number of federal regulations that are nullified: Not only are fewer employees required to enforce fewer regulations, but the agency would produce fewer regulations once its scope of authority is properly limited.

No. Agencies should be sized according to their missions, not the length of the laws creating them or the volume of orders or contracts they issue.

There is a lot of misinformation floating around about the size of government and the federal workforce. Many politicians want to transfer government agencies outside the DC area so they could somehow be “closer to the people.” In fact, 80% of federal civilian workers already work outside DC. Moreover, the federal government has not grown faster than the population it serves.

Analyzing the federal workforce as a percentage of the total U.S. population for the past 15 years reveals the workforce has represented approximately 0.6% of the population. This percentage remained stable as the population and workforce have grown, indicating that the federal workforce has kept pace with population growth. However, it is still a significant decrease from 1945, when the workforce represented a historic 2.5% of the entire population.

DOGE also has a crazy definition of “waste.” Musk seems to think that anything he doesn’t like is wasteful. Here’s a list he posted. I’m willing to grant that many of the items sound fishy [“DOD lobster tank $8,395”], but ¾ of his list of supposed waste is the $659 billion for net interest on the national debt. If we stopped paying it, our economy would collapse.

Another DOGE complaint is spending money on programs that lack formal authorization in law or whose authorizations have lapsed. Kevin Drum explains why that is regularly ignored by Congress.

Constitutionally, Congress doesn't need to "authorize" anything. All they have to do is appropriate. However, House rules require an authorization to be passed before any money can be appropriated for a program. This rule is generally followed for initial appropriations, but lots of laws are written with specific authorized amounts for their first few years and are never updated afterward even though Congress goes on merrily appropriating money. According to the Congressional Budget Office, there are 1,515 unauthorized programs currently being funded. Here's how they break down:

In theory, unauthorized spending can be stopped in its tracks very simply: any member of the House can raise a point of order against an unauthorized appropriation. However, this tactic can be closed off under suspension of the rules or under the terms of a special rule.

The bottom line is that this is not some weird form of Deep State corruption discovered by Elon Musk. Congress is well aware of it, and apparently there are norms of some kind that allow it to continue. I don't really understand that part, though. In any case, "unauthorized" spending isn't illegal in any sense. It's all normal, legit spending approved by majority vote under rules or norms that Congress can change anytime it wants. It can't be cut by executive order and there's no special reason to target it compared to any other spending.

Fixation on savings and efficiency rather than performance and effectiveness is a recipe for failure and worse: reductions in the capability of government to do what is necessary.

DOGE also may be blocked from recommending reforms in Defense and social programs like Medicare and Social Security. That’s where the real money is, not in discretionary domestic spending. But if DOGE is blocked from even looking at those programs out of political concerns, then the result will be both insufficient and harmful.

The Pentagon should be judged by the capabilities it buys, not the spending level. There are good arguments for increased capabilities that may cost more money, but there are already enormous inefficiencies and questionable programs in the budget. I was impressed by a presentation by Shyam Sankar, CTO of Palantir, a very cutting edge defense company.

We have a peer adversary: China. “Near-Peer” is a shibboleth, a euphemism to avoid the embarrassment of acknowledging we have peers when we were once peerless. In World War II, America was the best at mass production. Today that distinction belongs to our adversary. America’s national security requires a robust industrial base, or it will lose the next war and plunge the world into darkness under authoritarian regimes. In the current environment, American industries can’t produce a minimum line of ships, subs, munitions, aircraft, and more. It takes a decade or two to deliver new major weapon systems at scale. If we’re in a hot war, we would only have days worth of ammunition and weapons on hand. Even more alarming is our lack of capacity and capability to rapidly repair and regenerate our weapon systems.

In 1993, after the end of the Cold War, America wanted a Peace Dividend and defense spending was slashed by 67%. The Secretary of Defense held a dinner at the Pentagon — the so-called “Last Supper” — to tell the 51 primes they would not all survive. Today, there are 5.

The most important consequence of the Last Supper wasn’t a reduction in competition in the Defense Industrial Base, but the decoupling of commercial innovation from defense and the rise of the government Monopsony. Consolidation bred conformity and pushed out the crazy Founders and innovative engineers. This was the Great Schism of the American Industrial Base.

Before the fall of the Berlin Wall, only 6% of defense spending went to defense specialists — so called traditionals. The vast majority of the spend went to companies that had both defense and commercial businesses. Chrysler made cars and missiles. Ford made satellites until 1990. General Mills — the cereal company — made artillery and inertial guidance systems.

But today that 6% has ballooned to 86%. The Monopsony’s fixation on cost-plus contracting, control, and tedious regulation has made working in the national interest bad business, suitable only to risk-averse investors who are addicted to dividends and buybacks — a luxury only affordable at the end of history. That is not what the most dynamic parts of the American economy do — only the dying parts.

Working with the Monopsony as a defense contractor is so unappealing that Ball would rather make beer cans than satellite buses. That is depressing.

The root of our pathology is a lack of competition inside of Defense. Avoid a monopsonistic buyer at all costs by approximating market mechanisms and dynamics as a key principle of the design of the DOD (e.g., the newly created Space Force is a worthy competimate to the NRO). What looks like duplication is insurance against complacency and unpredictability — there is nothing more costly than losing. When only Monopsony persists, things will not work, they will be expensive, and they will make us weaker. The last great Monopsony was Walmart. In the 90s their TV advertisements promoted everyday, low prices. The strategy was to squeeze suppliers on prices rather than encourage innovation. They never saw Amazon coming, and are now ⅓ of the size. Will we let that happen to America?

This [ideology and management] approach, now deeply engrained in defense management culture, process, law, and regulation, is based on the concepts of scientific management that were once fashionable in the Soviet Union and at the vanguard of the 1950s U.S. auto industry before it was outcompeted by Japan in the 1970s. Centralized, predictive program budgeting, management, and oversight were then thought to be superior to the trial and error and messiness of time-constrained, decentralized experimentation and the seemingly wastefulness of having multiple sources rapidly prototyping potential solutions.

I don’t know how to achieve all the things Sankar proposes, but I know DOD needs more innovative thinking and processes. The Pentagon can’t be exempt from cost savings and other reforms.

What we really need across government is better capacity. The Niskanen Center has a brilliant new paper making this key point with extensive details. Some excerpts:

Our politics have become so chaotic in part because the public has lost trust in the government’s ability to deliver on its promises. Restoring this public trust is both a moral and a political imperative for leaders who want to leave their mark.

Rebuilding our state capacity — the how of our government — is an arduous task that requires a stomach for learning and fixing the rules and culture of the bureaucracy. But make no mistake: whether or not we do it is not a technocratic choice. It’s a political choice — a leadership choice. Previous administrations may not have actively set out to make dealing with public services a burden, or to cripple our nation’s military readiness with policy clutter amounting to hundreds of copies of War and Peace, or create a veto-cracy that limits our ability to build infrastructure. But neither have they made fixing it a priority. This one can, and should.

What are the forces making the government so slow? The first of those dysfunctions is what Nicholas Bagley of the University of Michigan calls the “procedure fetish,” and we dub the bureaucratic anxiety cycle. Anxiety about legitimacy and accountability drives critics to demand, and bureaucrats to seek refuge behind, more and more layers of procedure that show things have been done “by the book.” But all that procedure further erodes both legitimacy and accountability by overburdening the bureaucracy, reducing its ability to deliver meaningful outcomes.

This downward spiral is exacerbated by a complementary anxiety cycle in the legislative branch. Legislators are often frustrated with the performance of the administrative agencies they oversee. They frequently respond by being ever more detailed and specific in their instructions, reducing the agencies’ sense of responsibility and accountability to deliver outcomes. Agencies are already highly constrained not just by the specific directions they’ve been given to execute in their area of focus, but by enormous bodies of rules governing how to conduct common operations from hiring to purchasing. The constant stream of mandates and constraints from above actually reduces the agency’s effectiveness rather than improving it, furthering legislative anxiety about performance, and leading the cycle to repeat. While executive branch agencies must play their role in taming the procedure fetish, the first branch must do its part too.

Another dynamic that causes policy accretion is what we call the tyranny of tiny decisions. Whenever a process is created in any large organization, there are always a series of suggestions for additional qualifiers and considerations that are individually proportionate and sensible responses to a possible risk. The problem is that when you look back and add up all the tiny, sensible things, you have created a clunking behemoth. And worse, because each individual addition makes sense, it is then incredibly hard to argue that it should be removed from the list, and given the work that’s gone into it, also incredibly hard to wipe the slate clean and start again. Avoiding this outcome requires having a willing and able leader empowered to make choices about what’s in and what’s out, and dedicated to a usable, functional process, rather than one that makes every contributor happy.

The constant accretion of policy and process has another source: adversarial legalism. This, too, becomes a cycle. When government is sued or an agency called before a Congressional committee, it generally defends itself on the basis of having followed the proper procedure. But parties seeking advantage find in those procedures opportunities to attack or at least slow down government action. The attacks spur bureaucracies towards ever-more detailed, voluminous procedures, repeating the cycle. Both the lawsuits and the procedures are key drivers of the pacing problem. It is hard to move fast when you must generate mountains of paperwork and move at the speed of the courts.

One reason policymakers often misjudge the burden their guardrails will impose is a further dynamic we call the cascade of rigidity. The cascade begins with high-level principles outlined in legislation and executive orders. As these principles descend through layers of bureaucracy, they are translated into more specific and prescriptive guidance. Each level of government, from agencies and sub agencies to individual bureaus and divisions, interprets and operationalizes the guidance in its own way. With each step down the ladder, the flexibility intended by the original framers is diminished, replaced by rigid interpretations and narrow, literal applications of rules. Take, for example, how civil service rules intended to reduce bias and nepotism (and written at a high level to allow for judgment) have been translated at the operational level into a system that excludes the judgment of subject matter experts, and where instead candidates are evaluated on the basis of self-assessments and narrow, literal reviews by HR professionals. The result is that only those with insider knowledge of – or who are preferenced by – the process can make it through to the stage where hiring managers can consider them. The principles at the top and the mechanics at the bottom are in conflict. It can feel to lawmakers like the steering wheel they are supposed to have their hands on isn’t properly connected to the wheels.

A complete and detailed agenda for de-proceduralizing any given domain is out of scope for this report. However, we offer core principles to shape future efforts: • The revised system must shift its emphasis from compliance to meeting mission needs. This means power to make decisions must shift from compliance personnel to the people closest to the work. • The system must be able to work much faster than it does today. Speed of action will be an important metric in every area under reform. • In some cases, tweaks to the system are no longer sufficient to change on-the-ground behavior. Change must be big and structural. At the same time, change must be grounded in the public interest and uphold such core principles as expressed in the Merit System Principles (in the case of HR reform), anti-corruption principles (in the case of procurement), etc. In seeking much-needed bold change, we can’t throw the baby out with the bathwater. • We must accept that judgment is an essential quality of the work of public servants. That means decisions (hiring, firing, learning from user testing, etc.) should be defended in the first instance for being substantively reasonable, not for being made with pedantic fidelity to process.

The report has detailed recommendations for the White House, Congress, and civil servants. The problems are bigger than what DOGE is looking at, and reforms need to be judged by improving what government does and how. That is far more important than cost savings or personnel reductions.