DOGE's Key Revelation: A Federal Budget Made Into a Maze Impervious to Reform

The total amount of spending across “all agencies,” as recorded at usaspending.gov, appears to be 50% higher than most experts interviewed for this article think it actually was.

In Fiscal Year 2024, for instance, the website pegs total spending at $9.7 trillion, when several experts said it was probably around $6.5 trillion. No one could explain the much bigger figure. Officials with usaspending.gov conceded to RCI that their totals were wrong and said the error, which shows up in similar fashion for the last five fiscal years would be fixed soon. They offered neither an explanation for their higher total nor an estimate of what it should be. Two weeks later, the erroneous figures remain.

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Budget experts say the website’s seeming multi-trillion-dollar error illustrates a core challenge Musk and his colleagues at the Department of Government Efficiency face as they try to reduce Washington’s spending. In a twist on the classic Washington line, the problem is not just following the money but finding it in the first place. The federal government has become so big and so expensive that even experts have trouble navigating the morass of contracts, awards, grants, loans, and other items that have transformed the U.S. spreadsheet into a labyrinth pitted with dead ends and rabbit holes.

“When you see the process has become so arcane even I don’t claim these are real, hard numbers, then you know the process is definitely and irreparably FUBAR,” said David Ditch, using the acronym for “fouled up beyond all repair.” He spent years poring over federal budgets and spending at the conservative Heritage Foundation before moving this month to the Economic Policy Innovation Center.

Musk’s job may strike everyday Americans as ordinary in the sense that he’s trying to balance accounts, but Washington is a different animal, and several experts told RCI it stays that way on purpose. The complexity and layers Musk’s team has encountered are a feature, not a bug, according to this view.

"Federal government spending is nebulous and almost designed to be that way because no one person benefits from it being straightforward,” said Lydia Mashburn Newman, a managing director at the American Institute for Economic Research. “No one is trying to get a holistic picture of what this or that agency is doing and the way money gets appropriated is very fragmented.”

Newman has seen the beast from two sides, as a congressional aide and federal worker, and she says the comprehensive nature of DOGE is something new under the sun for the Washington bureaucracy.

"There is no total view of the budget. Congress simply takes last year’s number and changes it, usually to a larger number,” she said. “So the unique thing about DOGE is that it is providing a top-to-bottom audit. It’s not just asking if the books balance, but what is the money actually spent on." 

While Musk initially promised to cut some $2 trillion from the federal budget – and news accounts have focused on his efforts to reduce the federal workforce – DOGE’s real accomplishment so far has been to bring attention to the federal government’s broken accounting systems.

Despite the hue and cry raised over DOGE, previous alarms have been rung by some other agencies only to be ignored.

On Jan. 16, four days before Biden vacated the White House, the Government Accounting Office said it was “unable to provide an opinion on the reliability of the federal government’s consolidated financial statements for fiscal year 2024 and 2023.” 

The Office of Management and Budget has also flunked six of the 24 departments and agencies it looked at, including Labor and Education. The Defense Department has failed seven consecutive audits, while the Department of Education hasn’t gotten a “clean” opinion for three years.

It is hard to pass an audit when you don’t follow the basic rules of accounting. Musk reported that he was having difficulty tracing $4.7 trillion in federal spending because the Treasury Access Symbol (TAS)—a code that links payments to budget items— was allowed to be optional for years and often left blank. In response, Musk tweeted, the Treasury Department now requires “all outgoing government payments have a payment categorization code, which is necessary in order to pass financial audits. … All payments must also include a rationale for the payment in the comment field, which is currently left blank. Importantly, we are not yet applying ANY judgment to this rationale, but simply requiring that SOME attempt be made to explain the payment more than NOTHING!”

At the Treasury’s usaspending.gov, which experts use regularly and consider valid despite the big topline errors, nearly $150 billion is slotted every year into an “unreported data” box. 

While Musk’s team is reportedly using advanced artificial intelligence systems to comb federal records, it will face a different challenge when tackling the federal employee retirement system. DOGE will confront the “sinkhole of bureaucracy”: records still kept on paper and processed almost entirely by hand by some 700 workers who toil 230 feet below ground in an abandoned limestone mine in northwestern Pennsylvania.

The government’s use of antiquated systems helps explain some of Musk’s team’s biggest mistakes so far. This month, they claimed that millions of deceased people – some listed as more than 300 years old – are receiving social security benefits. It turns out DOGE probably misread the data sets, which includes millions of dead people not receiving benefits, in the antiquated, 1960s-era computer system Social Security still used to disperse more than $1.3 trillion to some 68 million people last year.

Musk conceded errors will be made, but experts told RCI some are impossible to avoid when trying to get a visible net around the surging ocean of federal government spending.

“Complexity isn’t an accident; it’s a consequence of a government that has grown far beyond its core functions and is tied down by a self-serving bureaucracy and public-sector union power,” said Romina Boccia, director of budget and entitlement policy at the libertarian Cato Institute.

“That complexity isn’t just an inconvenience – it shields waste, fuels inefficiency, and makes reform harder,” she said. “A government that has grown too big and too far-reaching makes it difficult to track what’s spent, let alone rein it in.”

Simply getting the information that Musk and some popular domestic auditors like DataRepublican have made public so far is an accomplishment. In the past, including Trump’s first term, efforts to put all the government’s financial laundry hanging on the line were met with indifference or resistance, according to Newman.

"All this seems ordinary to most Americans, but before Musk sent his teams in to get information, it was very time-consuming to get data,” she said. “In Washington, that’s just protocol: You ask for something, and it could take months to get. But DOGE, in partnership with OMB, is no longer allowing the stone-rolling that plagued the last Trump administration." 

One of the biggest challenges DOGE might face involves its effort to reduce waste, fraud, and abuse. As RCI reported last year, “Since 2003, when the government first started tracking improper payments, it is estimated that they have added up to more than $2.7 trillion, according to paymentaccuracy.gov, the public website where government agencies report their numbers.” That total is almost certainly a low-ball figure because the feds often rely on states, which also disburse money and often provide spotty accounting of their spending.

That $2.7 trillion figure does include $764 billion in improper payments paid during the first three years of the Biden administration to the wrong recipients, for the wrong reasons, or in the wrong amounts. The federal government estimates that nearly 6% of its total spending went to improper payments during Biden’s presidency, according to OpenTheBooks.com. During its first four-year term, the Trump administration issued an estimated $673 billion in improper payments, which were about 5% of government outlays, the watchdog group said. 

Yet that money has proven extremely difficult to claw back. 

An analysis by the Associated Press, for example, “found that fraudsters potentially stole more than $280 billion in COVID-19 relief funding; another $123 billion was wasted or misspent. Combined, the loss represents 10% of the $4.2 trillion the U.S. government has so far disbursed in COVID relief aid.”