Elon Musk’s Department of Government Efficiency (DOGE) claims to have achieved $160 billion in savings by targeting wasteful and fraudulent government spending. However, these efforts may inadvertently impose significant costs on taxpayers. According to an analysis by the Partnership for Public Service (PSP), a nonpartisan nonprofit organization, DOGE’s actions could result in a fiscal year cost of approximately $135 billion. This figure accounts for expenses such as paid leave for thousands of federal employees, re-hiring those mistakenly terminated, and lost productivity. The analysis does not include legal defense costs or potential revenue losses due to IRS staff reductions.

The PSP based its estimate on the annual compensation costs of the federal workforce, which total around $270 billion. It calculated the financial impact of DOGE’s initiatives, including placing employees on paid leave and reducing overall productivity. For instance, tens of thousands of federal workers were encouraged to accept deferred resignation plans, allowing them full pay and benefits without active work until September. Additionally, 24,000 employees who were initially dismissed as part of the reform effort have since been reinstated following a court ruling. Other agencies have also had to rehire workers erroneously let go, exemplified by bird flu experts dismissed by the USDA.

Furthermore, federal employees now face increased administrative burdens, such as documenting their weekly achievements, which has contributed to lower productivity levels. Max Stier, president of the Partnership for Public Service, expressed concerns over the unintended consequences of DOGE’s policies. He noted that while the initiative was designed to reduce waste, it appears to be creating more inefficiencies. Stier emphasized that the public would ultimately bear the brunt of these financial repercussions, with projected taxpayer costs expected to rise as further cuts take effect.

The White House has contested the PSP's findings, arguing that doubts cast on DOGE’s achievements reflect more about the credibility of critics than the effectiveness of the department itself. Harrison Fields, a White House spokesperson, stated that the American public supports the President’s mission to enhance governmental efficiency and remains unaffected by what he termed "lies" from legacy media outlets.

Beyond immediate fiscal impacts, job cuts within agencies like the IRS could lead to substantial revenue losses. Yale Budget Lab estimates suggest that planned workforce reductions at the IRS could result in forfeiting $323 billion in tax revenue over the next decade due to reduced compliance and fewer audits. While some direct savings from layoffs are anticipated—approximately $38 billion over ten years—other economic sectors may suffer. For example, cuts to health and science research funding could cause a $16 billion annual economic loss and eliminate 68,000 jobs, according to a study involving researchers from the University of Maryland and University of Pennsylvania.

Musk recently announced his intention to scale back involvement with DOGE starting in May, coinciding with Tesla’s recent financial struggles. Despite this decision, he plans to dedicate one to two days per week to ensuring ongoing efforts against government waste. Musk reiterated his commitment during Tesla’s first-quarter earnings call, emphasizing the necessity of maintaining vigilance against resurgence in inefficiency and fraud throughout the President’s term.

Despite reported savings, questions remain regarding the accuracy of DOGE’s claimed achievements. A February CBS News investigation revealed that some reported savings might be exaggerated. Moreover, achieving Musk’s ambitious goal of cutting $2 trillion annually from government spending seems improbable without affecting major programs like Social Security and Medicare, which President Trump has vowed to protect. As discussions continue, the true long-term impact of DOGE’s measures remains uncertain, leaving both supporters and critics alike awaiting further developments.