Business
DOGE Must Focus On Big Picture To Achieve Big Change
From the Daily Caller News Foundation
By Jenny Beth Martin
President-elect Donald Trump’s new Department of Government Efficiency (DOGE) is wasting no time in laying the groundwork for its effort to cut the size and scope of government. That Elon Musk and Vivek Ramaswamy are the right men to lead this effort is beyond doubt — Musk famously slashed the workforce at Twitter after he bought it and Ramaswamy made shrinking the federal workforce the centerpiece of his campaign for president a year ago.
They know how to find cost savings, and they have shown they are not afraid to do so.
Visiting with congressional Republicans last week, Musk and Ramaswamy even declared they would be keeping a “naughty and nice” list of those who work with them to save taxpayer money and those who do not.
To that end — because who, especially at this time of year, doesn’t want to be on a “nice” list? — here are some thoughts.
First, they are going to have to look at the big picture. They won’t find the $2 trillion Musk pledged to save by focusing on the old standby, “waste, fraud, and abuse.” Yes, they are certainly going to find plenty of waste, fraud, and abuse in the Government Accountability Office (GAO) reports their staff will review, but that will not be enough.
To find the big savings, they are going to have to shrink not just the size of the federal government, but its scope. The federal government is not huge just because it spends money inefficiently, it is huge because it is doing things it has no business doing.
Second, they are going to have to take advantage of the fact that much of that huge government was never specifically authorized by the Congress. The federal behemoth was created by the mass of alphabet soup executive branch agencies that have for decades been imposing regulations that have the force of law, even though the Congress never approved them.
Reversing that is going to require taking a chain saw to federal regulations. And we will need a proportionally reduced federal workforce to match the reduced federal regulatory regime. That should not be a problem; huge numbers of federal employees still have not come back to work in their offices, even though the COVID-19 crisis ended years ago. The DOGE should recommend that any federal employee who refuses a directive to come back to work in the office should be terminated. That will save taxpayer money, too — a 10% cut in the federal workforce would yield about $40 billion in savings every year.
Third, recognize that to make permanent change, executive orders will not be enough — because executive orders can be reversed by the next president. Laws, on the other hand, can only be overturned with new action by the Congress and the president. That makes laws tougher to overturn.
One of the legislative changes that would serve the long-term interest in getting the federal government under control would be passage of the REINS Act, a proposed law that would require any federal agency that wanted to impose a new regulation that would have a significant impact on the economy to first gain approval from Congress in the form of an affirmative vote in both houses, and then the signature of the president. As I said when discussing this on my recent podcast with American Commitment’s Phil Kerpen, ‘Imagine that — Congress votes on something before it becomes law!”
A second legislative change that could help make a major difference would be reform of the civil service laws that govern the federal workforce. Musk and Ramaswamy are going to recommend significant elimination of positions in the federal workforce. Under the current system, it is significantly more difficult to remove employees than it is in the private sector — even employees who engage in insubordination or flagrantly breaking rules. And before you retort, “but the tradeoff they agree to, and that we must honor, is that civil service employees accept lower compensation in exchange for that greater job security,” a recent analysis by the Cato Institute shows that “the average federal civilian worker made $157,000 in wages and benefits in 2023, much higher than the average U.S. private sector wages and benefits of $94,000.”
Greater job security on top of higher compensation? That wasn’t the deal.
Rep. Barry Loudermilk (R-Ga.) introduced his MERIT Act in the last Congress. It was a proposed law that would have strengthened agency management’s power to remove poor employees, expedited timelines and made other reforms to bring the system closer to the private-sector model. Something along those lines could be extremely helpful as federal managers move to meet their reduced workforce needs.
The DOGE enterprise begins with broad public support — a recent poll conducted by McLaughlin & Associates for the organization I lead, Tea Party Patriots Action, shows that 71% of Americans support the creation of DOGE and 65% support firing government employees who do not return to their offices to work.
Musk and Ramaswamy have taken on a huge task, and they recognize the opportunity before them. By focusing on big-picture efforts to shrink the size and the scope of the federal government, they can help restore it to its constitutional moorings, with government officials in a smaller, less intrusive, less expensive government that is more responsive to the needs, desires, and authority of the citizens on whose behalf and in whose name they toil.
Jenny Beth Martin is honorary chairman of Tea Party Patriots Action.
Business
Trudeau BLOWS through his deficit guardrail
From the Canadian Taxpayers Federation
The Canadian Taxpayers Federation is demanding spending cuts after the federal government broke through its own budget guardrail by running massive deficits and wasting $1 billion every week on debt interest charges as outlined in today’s Fall Economic Statement.
“Prime Minister Justin Trudeau went $20 billion over budget with his deficit,” said Franco Terrazzano, CTF Federal Director. “Trudeau said he had a guardrail in place to keep Canada’s finances safe and he just drove the deficit right through it.
“It’s dangerously irresponsible to blow through fiscal guardrails and the federal government needs to hit the brakes on spending immediately.”
The federal government repeatedly promised to keep the 2023-24 deficit within its own fiscal guardrail “at or below $40.1 billion.” However, today’s Fall Economic Statement shows the 2023-24 deficit was $61.9 billion. This year’s deficit is projected to be $48.3 billion.
The debt will total almost $1.3 trillion this year. When Trudeau first became prime minister, the debt was $616 billion. That means the Trudeau government is responsible for doubling the national debt.
Interest charges on the debt will cost taxpayers $53.7 billion this year. For context, the government will spend $52.1 billion through the Canada Health Transfer this year.
“Interest charges on the government credit card are costing taxpayers more than $1 billion every week,” Terrazzano said. “Years of massive deficits mean the government is wasting more money on debt interest charges than it’s sending to the provinces in health transfers.”
Budget 2024 forecasted spending this year to be $534.6 billion, but the Fall Economic Statement now forecasts spending to increase to $539.5 billion.
“Trudeau has lost control of the finances and our kids and grandkids will be paying the price for years to come,” Terrazzano said. “Canadians can’t afford to keep paying for a reckless government in Ottawa. Canadians need our federal government to cut spending and balance the budget.”
Business
Massive growth in federal workforce contributes to Ottawa’s red ink
From the Fraser Institute
By Ben Eisen
At the same time the Trudeau government opened Canada’s borders to historic numbers of immigrants leading to an explosion in population, the federal workforce was growing even faster.. much faster.
Here’s a fact that all Canadians should understand. Prime Minister Justin Trudeau has overseen the seven highest years of federal government spending in Canadian history (on a per-person basis, after adjusting for inflation).
The federal government’s high spending levels have produced a long string of budget deficits and growing mountain of debt. Federal net debt has approximately doubled in nominal terms since 2014/15 (one year before Trudeau took office), rising from $17,800 per person to $34,000 this year.
What’s driving all of this?
There are many factors, including the growth in the number of federal government employees. Our new study published by the Fraser Institute (based on data from the Parliamentary Budget Officer) found that after years of shrinking, the size of the federal government workforce began to grow in the mid-2010s. In fact, it began to grow significantly faster than the Canadian population.
To measure the growth, we used the federal government’s Full Time Equivalents (FTEs), which captures the expected work hours of a fulltime employee and allows for comparisons over time. In 2014/15, there were 340,669 FTE workers working directly for the federal government. By 2022/23 (the latest fiscal year of comparable data), this number had grown to 431,537 or by 26.1 per cent. By comparison, the Canadian population grew 9.1 per cent during this period—still a substantial growth rate, but far slower than the rate of growth of the federal workforce.
So how much has the rapid growth in federal government jobs cost taxpayers?
In our study, we consider what would have happened had the Trudeau government simply held the rate of growth in federal employment to the rate of population growth. Under this scenario, the federal government’s workforce today would be 57,170 fewer FTE workers than is in fact the case. Given that the average per-FTE cost of federal employment in 2022/23 was $130,583 (which includes salaries and other costs), the savings would have been substantial. Specifically, taxpayers would have saved $7.5 billion in 2022/23 alone. And if this money had not been spent, the federal deficit would have been 21.2 per cent smaller that year.
At all times, but particularly during a period of large deficits, the federal government should scrutinize all areas of spending including government employment. Personnel costs represent approximately half of the federal government’s operating costs, so it’s no surprise that growing employment costs have heavily contributed to Ottawa’s recent string of deficits.
According to the Trudeau government’s latest budget, Ottawa will run deficits for the foreseeable future and in 2029 net federal debt will reach $1.5 trillion. Unless the government reverses its spending trends, the cost of increased government employment will continue to strain federal finances in the years ahead, with taxpayers paying the bill.’
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