JPMorgan doubts the effectiveness of the newly formed Department of Government Efficiency (DOGE), led by Elon Musk and Vivek Ramaswamy under President-elect Trump, in reducing federal waste.
JPMorgan Doubts D.O.G.E.Reform
On November 22, JPMorgan Chase issued a report that assessed the newly established Department of Government Efficiency (DOGE). The department was established under President-elect Donald Trump and is currently led by Elon Musk and Vivek Ramaswamy. Its objective is to reduce wasteful expenditure and streamline federal operations.
“President-elect Trump is anticipated to pursue an agenda that promotes reduced red tape in terms of government efficiency.” “This encompasses the establishment of a new Department of Government Efficiency (DOGE),” JPMorgan stated, adding:
We think the Elon Musk–led department, which aims to cut wasteful government spending, will have a difficult time doing so.
Trump stated earlier this month that Musk and Ramaswamy “will pave the way” for his administration to “dismantle government bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure federal agencies.” He observed, “Most importantly, we will eliminate the substantial waste and fraud that are present in our annual $6.5 trillion government spending.”
Musk has claimed that the Department of Government Efficiency has the potential to reduce federal spending by at least $2 trillion. He has emphasized the necessity of addressing what he has referred to as “insane government spending” in order to prevent the United States from approaching bankruptcy.
He emphasized that “America is currently on the brink of bankruptcy at an accelerated pace” and that “immediate action is required to halt the de facto bankruptcy of America.”
JPMorgan provided an explanation for the potential obstacles that DOGE may face, stating:
The bottom line is that Congress controls government spending, and DOGE sits outside of Congress. The department can make all the suggestions it wants, but ultimately it’s the typical 60-vote majority in Congress that makes legislative changes.
The global investment bank concluded that investors’ primary concern in 2025 is the extent to which the Trump 2.0 agenda will be emphasized and which will be diminished.