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CNN
35 minutes ago
- Business
- CNN
Analysis: Scorecard: How Musk and DOGE could end up costing more than they save
Rather than set government straight, Elon Musk is leaving Washington with the federal budget all cattywampus. Deficit spending is increasing, not waning, and there is a growing school of thought that his 'efficiency' effort could end up costing the government as much as or more than it saved. The Tesla and SpaceX CEO came to Washington with a cut-till-it-hurts mindset and carte blanche from President Donald Trump. Musk quickly dialed back his campaign-trail bravado of cutting $2 trillion from the federal budget, but as recently as a Fox News interview in March, he said that by the time he left government, his Department of Government Efficiency 'will have accomplished most of the work required to reduce the deficit by a trillion dollars….' Instead, Musk will leave government work 'disappointed' that the Republicans he helped put in power are working to pass a bill that is estimated to add some $3.8 trillion in deficit spending and which Trump calls 'big' and 'beautiful.' There's no accounting trick to correct that imbalance. The budget is trillions out of whack, and the shock-and-awe campaign Musk and Trump imposed across the federal workforce has led to some serious PTSD for federal workers and contractors while claiming only to have saved $175 billion. That's not chump change, but it's not going to radically reform the US government. What's listed on the still-rudimentary DOGE website is also not an accurate reflection of what the group might actually have accomplished. DOGE will live on in the White House, 'like Buddhism' without Buddha, Musk has said, and CNN has reported that more cuts are planned after his departure. But the pace of DOGE activity has slowed, at least as reflected on its website. Musk's departure is an opportunity to consider whether the Department of Government Efficiency has lived up to its name. CNN's Casey Tolan is among the reporters who have been trying to match what DOGE claims to have saved or cut with what has actually been trimmed. Picking apart the 'estimated savings' of $175 billion on the DOGE website, Tolan told me that less than half that figure is backed up with even the most basic documentation. That means it's possible only even to start investigating about $32 billion of savings from terminated contracts, $40 billion of savings from terminated grants and $216 million of savings from terminated leases that DOGE claims. Plus, some of the specific terminations that are included in those numbers have no details at all. And Tolan has reported on the fact that DOGE's tally has 'been marred by various errors and dubious calculations throughout the entire time they've been releasing this info.' Probably not. The figure is based on '161 million individual federal taxpayers,' according to the DOGE website, which drastically undercounts taxpayers in the US. That 161 million figure is more likely a reflection of individual tax returns and would not reflect married people who file jointly, according to Betsey Stevenson, a former chief economist at the US Department of Labor during the Obama administration who is now a professor at the University of Michigan. 'This distinction is about trying to get that number as large as possible. If instead it was expressed as per American then it would be $514,' and only if you assume DOGE has saved $175 billion, which it probably has not, she told me in an email. Workers who generated revenue from the government have been fired, Stevenson points out. For example, staffing cuts at the IRS will mean the US brings in less revenue — but so will operating national parks short-staffed. Plus, a universe of litigation related to DOGE's efforts to cancel contracts and fire workers seemingly without cause is percolating through courts. 'In total, estimates suggest that what has been spent to generate these cuts may be as great as the cuts. In the long run, it's not clear that DOGE generated any savings,' she said. Max Stier, CEO of the Partnership for Public Service, has estimated in a back-of-the-envelope way that DOGE cuts could end up costing the US $135 billion simply because it will need to retrain and rehire elements of the work force that have been let go. The federal workforce is literally in trauma — something Trump's director of the Office of Management and Budget, Russ Vought, said was an aim of his. Stier estimates the federal workers will be much less productive after DOGE's efforts, for a variety of reasons. Workers are now worried about losing jobs; their morale is depleted; they are distracted from their work; and many top performers are being reassigned or are leaving entirely. In a previous interview, Stier described the DOGE effort to me as 'arson of a public asset.' We probably can't, according to Nat Malkus, a senior fellow at the American Enterprise Institute who has tried to keep track of DOGE's accounting for its cuts. While Musk has promised maximum transparency, it has been impossible to verify much of what DOGE has said it has done. 'We expect the government to show receipts,' Malkus told me in a phone interview. 'And the receipts that DOGE has shown that are posted publicly are nonetheless woefully inadequate to back their claims,' he said. Far from fundamentally changing government, the savings DOGE claims won't actually be realized unless and until Congress, which has the power of the purse in the Constitution, passes a rescission bill to claw back the funding. 'So far, we've just canceled contracts,' he said. 'The money is still spent because Congress spends the money.' The DOGE effort has certainly changed the tenor of the conversation around government spending. Its aggressiveness came as a shock to many Americans. 'They have shown that they're willing to inflict pain in the pursuit of reducing government expenditures,' Malkus said, adding that most Americans think the government spends too much money. 'That resolve is something rare and potentially valuable,' Malkus said. DOGE also brought in a tech mindset of cutting more than is necessary with the aim of building back, something that could be argued occurred with the rehiring of nuclear safety workers, for instance, or the reinstatement of certain contracts. Jessica Tillipman, an expert in government procurement law at George Washington University, is troubled by the idea that the government has gone from being the best business partner to one contractors approach with caution. 'The government's not acting like a good business partner right now,' Tillipman said. 'They're squeezing contracts that have been fairly negotiated between the government and contractors.' It's always possible DOGE could end up reforming government in positive ways, but the evidence is not yet there, Tillipman said. 'What have we seen? You require everybody to come back to work and you don't have office space,' she said as one example. 'You have people doing work that they're not trained to do. You have talent drains,' Tillipman said, pointing out that most of the government firings so far were among recently hired workers often brought on with a particular expertise. 'Half the training programs for the government have been canceled, so these pipelines that the government spent decades working on to make sure that there's a steady supply and the government's an attractive place for high-quality talent have gone away.' The long-term effect of those changes will not be clear for some time. 'There's a long way to go before this is going to actually shift the way agencies work,' Malkus said. 'It just takes longer than four months.' Stevenson pointed out that despite everything DOGE claimed to do, government outlays are on track to rise by 9% in 2025 compared with 2024. That's because Americans are living longer and drawing more from programs like Medicare and Social Security. It's those programs that are driving the deficit and debt, not the discretionary spending Musk targeted. 'Chainsaws and bluster can't solve the yawning gap between revenue and spending that has led American debt to rise to unsustainable levels,' Stevenson said.
ARN News Center
an hour ago
- Automotive
- ARN News Center
Musk aiming to send uncrewed Starship to Mars by end of 2026
Two days after the latest in a string of test-flight setbacks for his big new Mars spacecraft, Starship, Elon Musk said on Thursday he foresees the futuristic vehicle making its first uncrewed voyage to the red planet at the end of next year. Musk presented a detailed Starship development timeline in a video posted online by his Los Angeles area-based rocket company, SpaceX, a day after saying he was departing the administration of US President Donald Trump as head of a tumultuous campaign to slash government bureaucracy. The billionaire entrepreneur had said earlier that he was planning to scale back his role in government to focus greater attention on his various businesses, including SpaceX and electric car and battery maker Tesla Inc. Musk acknowledged that his latest timeline for reaching Mars hinged on whether Starship can accomplish a number of challenging technical feats during its flight-test development, particularly a post-launch refueling maneuver in Earth orbit. The end of 2026 would coincide with a slim window that occurs once every two years when Mars and Earth align around the sun for the closest trip between the two planets, which would take seven to nine months to transit by spacecraft. Musk gave his company a 50-50 chance of meeting that deadline. If Starship were not ready by that time, SpaceX would wait another two years before trying again, Musk suggested in the video. The first flight to Mars would carry a simulated crew consisting of one or more robots of the Tesla-built humanoid Optimus design, with the first human crews following in the second or third landings. Musk said he envisioned eventually launching 1,000 to 2,000 ships to Mars every two years to quickly establish a self-sustaining permanent human settlement. NASA is currently aiming to return humans to the surface of the moon aboard Starship as early as 2027 - more than 50 years after its last manned lunar landings of the Apollo era - as a stepping stone toward ultimately launching astronauts to Mars sometime in the 2030s. Musk, who has advocated for a more Mars-focused human spaceflight programme, has previously said he was aiming to send an unmanned SpaceX vehicle to the red planet as early as 2018 and was targeting 2024 to launch a first crewed mission there. The SpaceX founder was scheduled to deliver a livestream presentation billed as "The Road to Making Life Multiplanetary" from the company's Starbase, Texas, launch site on Tuesday night, following a ninth test flight of Starship that evening. But the webcast was cancelled without notice after Starship spun out of control and disintegrated in a fireball about 30 minutes after launch and roughly halfway through its flight path without achieving some of its most important test goals. Two preceding test flights in January and March failed in more spectacular fashion, with the spacecraft blowing to pieces on ascent moments after liftoff, raining debris over parts of the Caribbean and forcing scores of commercial jetliners to change course as a precaution. Musk shrugged off the latest mishap on Tuesday with a brief post on X, saying it produced a lot of "good data to review" and promising a faster launch "cadence" for the next several test flights.
NDTV
2 hours ago
- Business
- NDTV
Explaining The BharatNet Vs Starlink Debate And What's At Stake
As India accelerates its ambition to become a digitally inclusive economy, a new debate is heating up - one that pits the government's homegrown BharatNet initiative against Elon Musk's Starlink, the satellite internet service of SpaceX, and Amazon's Kuiper. The question making the rounds on social media is: What happens to BharatNet if Starlink enters the Indian market at scale? Here's a detailed look at where the two stand. What Is BharatNet? Launched in 2011 as the National Optical Fibre Network (NOFN), and later rebranded as BharatNet, the project aims to connect over 2.5 lakh gram panchayats (village councils) with high-speed broadband via optical fibre. It's a massive public infrastructure undertaking, backed by state and central government funds, and intended to act as the backbone for rural digitisation - from e-governance to telemedicine and online education. Unlike private players, BharatNet doesn't chase profits. Its aim is to democratise access to the internet and level the playing field between India's urban and rural landscapes. What Is Starlink? Starlink is SpaceX's satellite internet venture, offering high-speed broadband via low-earth orbit satellites. Instead of relying on towers or fibre cables, Starlink beams internet from space, bypassing terrestrial infrastructure entirely, relying on satellite communication. In remote or underserved areas, this can be a game-changer. The company already operates in over 60 countries and is positioning itself as a solution for areas that fibre can't easily reach. Elon Musk's company is set to begin operations in India within 12 months by offering internet speed of 600 to 700 Gbps, according to NDTV Profit quoting Department of Telecommunication sources. This initial beaming capacity will only support between 30,000 and 50,000 users at a time and in certain cities or built-up areas, but this will eventually expand to a staggering 3 Tbps, or terabytes per second, by 2027, DoT sources said, pending regulatory approval. Why The Debate Matters At its heart, the BharatNet vs Starlink debate isn't about which technology is superior - it's about who controls India's digital future. Starlink offers rapid deployment and global coverage. But its entry into India raises questions about: Data sovereignty Pricing regulation Revenue repatriation Fair competition with local infrastructure BharatNet, meanwhile, is Indian. Its architecture is designed to serve national priorities, not shareholder returns. Starlink has been trying to enter the Indian market since 2022, and was given a letter of intent by the government earlier this month. Both Airtel and Jio had opposed its entry. Can They Co-Exist? BharatNet and Starlink serve different needs and different terrains. While BharatNet is better suited for dense rural clusters and institutional connectivity, Starlink could help in extremely remote areas, disaster zones, and difficult terrain such as the Northeast, the Himalayas or islands like Lakshadweep. But the concern is this: If Starlink floods the market with cheaper, faster connections, it could undermine the BharatNet model - particularly the business viability of local service providers using BharatNet infrastructure. Several users on social media say that BharatNet should pivot towards a hybrid model - one that incorporates both fibre and satellite technologies. Though the Indian government has not said anything about this, some news outlets are claiming that the hybrid model is under consideration. While optical fibre can provide high-capacity, low-latency connections, satellite internet can be provided to gram panchayats in remote an hard-to-reach areas. The Risk of Digital Colonisation Allowing unregulated access to global satellite networks also opens the door to what several internet users and experts call "digital colonisation". The concern stems from Starlink's Africa plan, where it is providing high-speed internet from Nigeria to Congo. In a strong Substack piece, user Edward Shepherd said the colonisers are orbiting 550-km above the sea level, referring to the low-orbit satellites used by Starlink to provide a reliable internet connection. What India Gains from Supporting BharatNet The homegrown BharatNet is creating opportunities for village-level entrepreneurs, technicians and service providers. Further, the fibre is Indian, the management is Indian and so are the objectives. BharatNet also provides a long-term resilience since national control over digital infrastructure is vital in an era of cyber warfare and information geopolitics. Finally, BharatNet aligns with schemes like Digital India, Jan Dhan and Ayushman Bharat to bring services to the last mile.
News24
2 hours ago
- Business
- News24
Chainsaw politics: How Elon Musk shot up in Trump orbit before flaming out of DOGE
Elon Musk rose rapidly in the Donald Trump orbit. He played a key role in getting Trump elected. But he became disillusioned with obstacles faced by DOGE. Elon Musk stormed into US politics as President Donald Trump's chainsaw-brandishing sidekick. Four turbulent months later it's the tech tycoon himself on the chopping block. Trump hailed Musk as 'terrific' as he announced that they would hold a joint press conference on Friday as the South African-born magnate leaves the so-called Department of Government Efficiency (DOGE). 'This will be his last day, but not really, because he will, always, be with us, helping all the way,' Trump said on his Truth Social network on Thursday. But the warm words could not hide the open frustrations that Musk, the world's richest man, had expressed in recent weeks about his controversial cost-cutting role for the world's most powerful man. READ | Elon Musk unceremoniously leaves Trump administration after criticising tax bill Once a fixture at the Republican president's side, dressed in T-shirts and MAGA baseball caps, Musk had shown growing disillusionment with the obstacles faced by DOGE even as it cut a brutal swath through the US leaves far short of his original goal of saving $2 trillion, with The Atlantic magazine calculating he saved just one thousandth of that, despite tens of thousands of people losing their jobs. Instead, he will focus on his Space X and Tesla businesses, as well as his goal of colonising Mars. It was all very different at first, as the 53-year-old Musk rose through Trump's orbit as rapidly as one of his rockets - though they have been known to blow up now and again. Musk was the biggest donor to Trump's 2024 election campaign and the pair bonded over right-wing politics and a desire to root out what they believed was a wasteful 'deep state'. DOGE was jokingly named after a 'memecoin', but it was no joke. Young tech wizards who slept in the White House complex shuttered whole government departments. Foreign countries found their aid cut off. Saul Loeb/AFP A shades-wearing Musk brandished a chainsaw at a conservative event, boasting of how easy it was to save money, and separately made what appeared to be a Nazi salute. Soon the man critics dubbed the 'co-president' was constantly at Trump's side. The tycoon appeared with his young son X on his shoulders during his first press conference in the Oval Office. He attended cabinet meetings. He and Trump rode on Air Force One and Marine One together. They watched cage fights together. Many wondered how long two such big egos could coexist. But Trump himself remained publicly loyal to the man he called a 'genius'. One day, the president even turned the White House into a pop-up Tesla dealership after protesters targeted Musk's electric car business. Yet the socially awkward tech magnate also struggled to get a grip on the realities of US politics. The beginning of the end 'started (in) mid-March when there were several meetings in the Oval Office and in the cabinet room where basically Elon Musk got into fights', Elaine Kamarck of the Brookings Institution told AFP. Brendan Smialowski/AFP One shouting match with Treasury Secretary Scott Bessent could reportedly be heard throughout the West Wing. Musk publicly called Trump's trade advisor Peter Navarro 'dumber than a sack of bricks'. Nor did Musk's autocratic style and Silicon Valley creed of 'move fast and break things' work well in Washington. The impact on Musk's businesses also began to hit home. A series of Space X launches ended in fiery failures, while Tesla shareholders fumed. Musk started musing about stepping back, saying that 'DOGE is a way of life, like Buddhism' that would carry on without him. Finally, Musk showed the first signs of distance from Trump himself, saying he was 'disappointed' in Trump's recent mega spending bill. Musk also said he would pull back from spending time on politics. The end came, appropriately, in a post by Musk on Wednesday on the X network, which he bought and then turned into a megaphone for his right-wing politics. But Musk's departure might not be the end of the story, said Kamarck. 'I think they genuinely like each other and I think Musk has a lot of money that he can contribute to campaigns if he is so moved. I think there will be a continued relation,' she said.
Sky News
2 hours ago
- Business
- Sky News
From Tesla tequila to Iron Man inspiration: 7 things you may not know about Elon Musk
The name Elon Musk is perhaps one of the most recognisable in the modern day. The richest man in the world is known for being the owner of various companies including electric vehicle maker Tesla and Space X, his takeover of social media company Twitter - which he renamed X - and, until most recently, his work within the US government. After nearly 130 days as head of the Department of Government Efficiency - known as DOGE for short - Musk announced he is leaving his role within Donald Trump's administration. His work within the department and his close relationship with Mr Trump led to Musk being in the headlines more than ever, but there is much to the billionaire businessman that is rarely reported. Here are seven things you may not know about Musk. Child video game creator In the early 1980s, at the age of 12, Musk created the video game Blastar. He created the game, which tasks players to use their keyboards to shoot at alien fighter spaceships, through his knowledge of coding and programming, which he picked up at the age of nine, according to Ashlee Vance's 2015 biography of the tech mogul. By 1984 the game was so good, Musk sold it to PC and Office Technology magazine for $500 (£371), where it featured in the publication's December issue. First big pay cheque From the get-go, it was clear Musk had a talent for business. In 1995, age 24, he set up his first company, Zip2 with his brother, Kimbal. The pair set up the company, which created online city guides for newspapers, for around $28,000 (£20,000). It was sold for around $300m (£222m) four years later in 1999. Before cashing in on the success of Zip2, Musk said he and his brother were pretty much broke and both slept in the office where they worked - a behaviour he reportedly replicated in the early days of Tesla. From the sale of the company, Musk walked away from Zip2 with a cool $22m, and the first thing he bought was a McLaren F1. He told CNN at the time: "Just three years ago I was sleeping on the office floor, and now I've got a million-dollar car." Musk's musk Despite having huge success, some of Musk's ideas have not proved to be as long-lasting. In 2022, he launched a perfume called Burnt Hair, which is described on his The Boring Company website as "the essence of repugnant desire". The scent, which cost $100 (£74) a bottle, was a smash hit, according to Musk, who said it had sold 10,000 bottles in just a few hours, earning him a million dollars. "With a name like mine, getting into the fragrance business was inevitable - why did I even fight it for so long!?" Musk said at the time. It is unknown if the product was serious, and (sadly) is no longer available on The Boring Company website. In addition to perfume, Tesla launched its own tequila in 2020, and in the same year, Musk followed through on a joke to sell limited edition pairs of Tesla short shorts as a way to prove investors who bet against the electric vehicle maker wrong. The original PayPal Long before Twitter became X, Musk created an online banking and financial services company. The platform quickly attracted a large customer base, and in the year 2000, it merged with Confinity, which was co-founded by tech entrepreneurs Peter Thiel and Max Levchin. The platform was later renamed PayPal. Musk went on to become chief executive of PayPal, but was later ousted from the position as arguments over the company's name and overall direction emerged. In 2002, the banking site was bought by eBay for $1.5bn (£1.4bn). Years later, in 2017, eBay sold the domain back to Musk. Inspiration for Iron Man Musk's life as a billionaire entrepreneur sounds like the start of a Hollywood blockbuster. And in reality, Musk's personality and accomplishments were partly used as inspiration for Robert Downey Jr's portrayal of Iron Man in the Marvel Cinematic Universe. In a 2022 interview, Iron Man screenwriter Mark Fergus said his version of Tony Stark was based on a culmination of Musk, Mr Trump and Apple creator Steve Jobs. "Musk took the brilliance of Jobs with the showmanship of Trump. He was the only one who had the fun factor and the celebrity vibe and actual business substance," Mr Fergus told New York Magazine. Musk's unusual connection to the fictionalised billionaire was played out on camera when he made a cameo in Iron Man 2 in 2010. The real Tesla founder? Contrary to belief, Musk did not start Tesla. He was actually an early investor in the company and was the fourth chief executive when he took over the role in 2008 - shortly after the company released its first car - the Roadster sports car. It was in fact, Martin Eberhard and Marc Tarpenning who founded the company in 2003, albeit Musk was the one to propel it on to a global stage. Desire for the 'everything app' After taking over social media platform X for $44bn in 2022, Musk became one step closer to achieving his goal of creating an "everything app". 13:05 The tech mogul has previously said he wishes for X to become similar to WeChat - a Chinese app that offers a wide range of features beyond messaging, including payments, ordering taxis, sharing social media posts and conducting business - think of it as a mix between Facebook, Apple Pay, WhatsApp and Google. Musk's vision of this "super app" seems to be shared by those at X, including chief executive Linda Yaccarino, who said at the end of last year that 2025 would be the year that X "connect[s] you in ways never thought possible. X TV, X Money, Grok and more". And this appears to be somewhat coming true. In January, Musk announced X had partnered with payment giant Visa, which will allow users to move funds between traditional banks and a digital X wallet and make payments to friends.
