Elon Musk Calls for DOGE Review of $2.5 Billion Fed Renovation

Elon Musk, the billionaire entrepreneur and CEO of tesla, has recently proposed that the Department of Government Efficiency (DOGE) should closely examine the Federal Reserve's spending, with a particular focus on the $2.5 billion renovation of its Washington D.C. headquarters. This suggestion is part of Musk's broader initiative to reduce wasteful government spending and improve efficiency.

During an interview with print reporters, Musk voiced his concerns about the high cost of the renovation project. He questioned the necessity of spending $2.5 billion on redecorating and advocated for a thorough review of the expenditures. The Federal Reserve initiated the project in 2021 with an initial budget of $1.9 billion, but various factors, including rising material costs, construction delays, design changes, and site issues, have led to significant cost overruns. The renovation aims to address a backlog of upgrades, comply with building codes and regulations, update technology, and enhance energy efficiency. Fed officials maintain that these changes will ultimately save money by consolidating staff and reducing leasing costs, while providing a modern workspace for employees.

Musk, however, believes that the cost overruns should be part of a broader examination of government waste. DOGE claims to have saved taxpayers $160 billion during its short operating life by reviewing government expenditures. Musk emphasized that since the funds are ultimately taxpayer money, it is crucial to ensure that the Federal Reserve is spending wisely. He suggested that DOGE should investigate the details of the renovation to verify the value of the expenditures.

It is important to note that the Federal Reserve is not funded by taxpayers but rather by the interest it earns on its securities and fees from banks it supervises. The money the Fed earns beyond its operating costs is typically paid back to the Treasury. However, in the past two years, the central bank has incurred operating losses due to rising interest rates on bank reserves.

The renovation documents filed with the National Capital Planning Commission indicate that while the building has undergone regular modifications and renovations over its 80-year history, many of its systems are at the end of their useful life and no longer fully serve the Board's needs. Fed officials declined to comment on Musk's suggestions.

Musk's proposal to have DOGE investigate the Federal Reserve's spending is part of a broader effort to exert more political control over government agencies. This move aligns with the goals of the Department of Government Efficiency, which aims to identify and eliminate wasteful spending across various government departments. Musk's comments highlight the ongoing debate about government efficiency and the need for transparency in public spending.