Musk Is Firing Federal Workers Who Prevent Bloated Tech Contracts

The Intercept

19-03-2025

Earlier this month , all of the employees at 18F, a unit of government technologists under the General Services Administration, awoke to a surprise.
The entire department — which helps build, buy, and share technological products across government agencies — discovered they'd been placed on administrative leave.
18F, named after its headquarters at 18th and F Street, plays crucial roles across the federal bureaucracy: It's the team behind the IRS free tax filing system, and the National Weather Service's public website, weather.gov. It launched in 2014 under the Obama administration, emerging from the Presidential Innovation Fellows program, which sought to bring more 'technologists' into the federal government. Following the disastrous implementation of healthcare.gov, 18F became a permanent home for government digital services.
In many ways, the writing had long been on the wall for the beleaguered staff at 18F. Republicans had routinely accused it of being too woke for its culture and practices — including a Slackbot that privately alerts staffers when they've used offensive or non-inclusive language. Weeks prior, Elon Musk had posted on his social platform X that 18F 'has been deleted.'
But for some employees at 18F, inclusive politics is only part of the explanation for why they were axed. Three former 18F employees who spoke with The Intercept argue that their role in safeguarding against unchecked technology spending put a Musk-sized target on their back.
'Our whole approach was saving the government money and time.'
'It's a move to cut the brakes guarding against reckless government technology spending,' said one former 18F employee. With 18F out of the picture, Musk 'and other private corporations who want to basically take advantage of taxpayer money can get in with less scrutiny.'
The former employee, who spoke anonymously for fear of retaliation, said 18F had been in the crosshairs of the technology industry for years because it refused to overpay for Silicon Valley products and services. 'Our whole approach was saving the government money and time, and building good quality public services. We never had an incentive to upsell,' the source said. 'We've had a lot of enemies since our inception. I think because we can provide a better service at a lower cost.'
Another former employee in the department, who also spoke on the condition of anonymity, agreed that 18F's fastidious approach could have made the department a target for Musk and his so-called Department of Government Efficiency.
Musk, who spent at least a quarter-billion dollars to elect Trump, is expected to see his substantial wealth balloon over the course of the Trump administration through government contracts. Though Tesla stock has faltered as Musk has taken on a highly public role in gutting the federal workforce, Trump has sought to help the world's richest man — going so far as to host a car show on the White House driveway to promote Musk's Teslas.
If the Trump administration pushed for government contracts that would financially benefit Musk or other Trump allies and donors, the source said, 18F would have pushed back.
'One-hundred percent that would be a reason,' they said. 'We would have been outspoken. We would have been vocal.'
Along with specific projects it conducts for federal agencies, 18F also designed a public 'de-risking guide' to help other parts of the government better vet and manage technology vendors. The guide along with the rest of 18F's website has now been wiped from the internet, increasing the risk of government agencies being misled by technology vendors.
'We've already seen a pattern from Musk, documented in the media, of Musk taking government money,' said one former 18F employee, pointing to the $38 billion Musk has collected in federal contracts to date. 'He's been public beneficiary number one, and if there's no one around to say, 'Hey, this contract is not written well, this is going to get us the wrong project, we don't need to be spending this much money.' If the brakes are cut, who's going to stop Musk from leveraging that hole where we no longer are and getting more government money?'
A spokesperson for the GSA pushed back against the allegations against Musk, arguing that cutting 18F is indeed a means of lowering costs to taxpayers.
'18F was intended to operate on a full cost recovery basis through the fees it charges federal agencies. Since its inception in 2014, 18F has underperformed on an annual basis relative to its cost recovery plan, creating a long-term shortfall of multi millions of dollars,' the spokesperson wrote in an email. 'The rate charged by 18F was at the very high end of the technology consulting market; making it one of the most expensive technology consultancies in the United States. The same private sector talent doing the same work would have cost partner agencies, and the American taxpayer, less money. After a thorough review of 18F, GSA leadership – with concurrence from the Administration and following all OPM guidelines – determined that the business unit was not aligned with the Presidential EOs, statutorily required or critical activities.'
One former 18F employee said this response lacks a basic understanding of how the government, and specifically the 18F team, operates. Unlike congressionally appropriated agencies, 18F charges other agencies for its services. These agencies are given federal appropriation money to spend on technology services like 18F. So, for example, 18F charges agencies like the IRS or the National Oceanic and Atmospheric Administration an hourly rate to develop, maintain, and update their technological products, such as the IRS direct file website or weather.gov. In many cases, this means procuring and working with outside technology vendors to build and help maintain these sites, with the goal of giving the agencies as much autonomy over their projects as possible.
According to the GSA spokesperson, last year, 18F fell $18 million short of the cost-recovery target set by their agency. The rates 18F can charge and the amount it is supposed to recover from other agencies are established by the GSA. Ahead of its dismissal, 18F was set to charge $250 an hour for their services this fiscal year, according to the former 18F employee.
The same former employee said that the GSA's desired recovery amount was never achievable and was divorced from 18F's costs — instead, they said, it was a target to fund work across the broader agency. The worker said 18F certainly would have been more effective and cost taxpayers less than commissioning big consultancies such as Deloitte and Booz Allen Hamilton.
Regardless of why 18F was eliminated, employees at the unit are certain more vital agencies are next on the chopping block.
'We're a month into this administration, and they're already cutting the people who put brakes on reckless technology spending. They're cutting the people who are working on systems that help taxpayers save money filing their taxes,' said one 18F employee. 'If they're willing to cut all these things, cut all of these public services, what's next?'