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Trump's DOGE Service Saves U.S. $1B Daily, Slashes Deficit

Coin WorldWednesday, Jan 29, 2025 3:37 am ET

1min read

The Department of Government Efficiency (DOGE), established by President Trump, has initiated a significant effort to cut federal spending and streamline government operations. Within a week of the executive order, the DOGE Service has reportedly saved the U.S. government approximately $1 billion per day, totaling $365 billion by January 2026. This reduction could cover nearly 43% of the 2024 defense budget and slash interest costs by over $12 billion annually.

DOGE's success can be attributed to three key moves: freezing non-essential hires, eliminating Diversity, Equity, and Inclusion (DEI) programs, and cracking down on improper payments abroad. These actions align with President Trump's executive orders and have set a new standard in fiscal discipline. If sustained, these savings could be redirected to infrastructure, healthcare, or national security.

The Kobeissi Letter highlights that to cut deficit spending by 50%, DOGE must increase daily savings to $2.5 billion. Lower deficit spending could naturally bring down bond yields, reducing interest costs and creating a positive economic cycle. Rising inflation and deficit spending concerns have pushed the 10-year Treasury yield up by 100 basis points since rate cuts began. If DOGE's deficit reduction leads to lower government borrowing, yields could stabilize, potentially saving U.S. consumers trillions in interest over the next decade.

However, completely eliminating the FY2024 deficit would require cutting $5 billion per day—five times the current rate. The last time the U.S. achieved a budget surplus was in 1998 under Bill Clinton. If successful, Trump and Elon Musk's DOGE initiative could mark the second such achievement since 1969.

The market has reacted positively to the news, with many cheering the impact of DOGE, an underdog crypto coin, on the U.S. economy. The savings are expected to reach over a trillion dollars during Trump's term, with only one week of the DOGE Service's implementation.

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