Based on available reports, Elon Musk, CEO of Tesla and SpaceX, has officially left the Department of Government Efficiency (DOGE), the controversial cost-cutting initiative launched by the White House under President Donald Trump’s administration.
- Legal Challenges and Growing Criticism
- Political Distractions and Tesla’s Stock
- Disputed Savings and Policy
- Fallout and What’s Next
- Conclusion: A High-Stakes Gamble with a Cautious Exit
- FAQs
- Why did Elon Musk resign from DOGE?
- How much did DOGE save taxpayers?
- What legal issues is DOGE facing?
- How did Musk’s involvement with DOGE affect Tesla?
- What’s next for DOGE?
- Glossary
Musk’s resignation was announced on X (formerly Twitter) on May 29 and reported by Reuters. His 130 day term as a Special Government Employee was set to expire on May 30.
In his post, Musk appreciated the President for the opportunity to reduce waste. Speaking with The Washington Post, Musk said,
”I was expecting the federal bureaucracy to be much worse than I expected. It was an uphill battle trying to improve things in DC, to say the least.”
Legal Challenges and Growing Criticism
Elon Musk’s exit comes as legal and public pressure mounts. A federal judge recently allowed a lawsuit filed by 14 U.S. state attorneys general to move forward, accusing Musk and DOGE of illegally controlling federal operations. The lawsuit alleges unauthorized access to federal data systems, termination of federal employees and cancellation of contracts.
A White House official told Reuters that Musk’s “off-boarding will begin tonight,” meaning the administration is complying with the legal requirements.
Posting on X, Musk said that
“the @DOGE mission will only get stronger over time as it becomes a way of life throughout the government.”
However, critics say his time at DOGE has been a distraction from his corporate duties, and Tesla is suffering.
Political Distractions and Tesla’s Stock
In a recent interview with Ars Technica, Elon Musk said,
“I think I probably spent a bit too much time on politics, It’s not like I left the companies. It was just relative time allocation that probably was a little too high on the government side, and I’ve reduced that significantly in recent weeks,” he said.
The announcement of his exit from DOGE in Tesla’s Q1 earnings report caused TSLA to surge 5% in after-hours trading despite the company’s net income dropping 80% year over year. As of March 31, Tesla still holds 11,509 Bitcoin, now worth around $1.24 billion, as it continues to bet on digital assets.
But TSLA is still down 5.9% year to date, just like Apple (AAPL), Nvidia (NVDA), Amazon (AMZN) and Google (GOOG). Analysts think Musk’s focus on DOGE might have contributed to Tesla’s slow down, but the company’s problems can also be tied to market conditions and supply chain issues.
Disputed Savings and Policy
DOGE, was supposed to streamline federal spending and had claimed to have saved taxpayers $175 billion through layoffs, program cuts and efficiency reforms. However, the number is disputed, with media reports including Reuters and The Washington Post pointing out calculation errors and misleading projections.
Multiple agencies confirmed the cuts affected about 260,000 federal jobs, roughly 12% of the federal workforce, through layoffs, buyouts and early retirements.
Critics say much of the “savings” are projections not actual cuts and the impact on essential services has been understated.
In a CBS interview, Elon Musk also criticized a multi-trillion-dollar tax break package approved by House Republicans on May 22, saying it would increase the deficit and undermine DOGE’s work.
“It’s frustrating to see efforts to reduce waste being counteracted by irresponsible tax policies,” Musk said.
Fallout and What’s Next
With Elon Musk out of DOGE, the future of the program is uncertain. Legal experts say the ongoing lawsuit could invalidate many of DOGE’s actions and leave federal agencies scrambling to rehire and re-contract employees and services that were let go during Musk’s tenure.
Musk’s exit has also brought up the question of what’s the proper boundary between private sector and government. Critics say putting high profile business leaders like Musk in government positions can create conflicts of interest and policy chaos.
Despite the controversy, Musk says his involvement with DOGE was minimal and that he’s since focused on his core businesses. His goodbye statement hinted at continued interest in public sector efficiency but acknowledged the reality of Washington politics.
“It was harder than I thought,” Musk told The Washington Post. “I underestimated how deep the bureaucracy really is. But I’m glad I tried.”
Conclusion: A High-Stakes Gamble with a Cautious Exit
While Elon Musk’s time may have led to a national conversation about wasteful government spending, his resignation and the lawsuits that followed show the complexity and messiness of governance reform.
The disputed savings figures, legal uncertainties and criticism from both public and private sectors mean DOGE’s impact may not be as big as promised. But DOGE’s reach into the federal apparatus and Musk’s involvement has left a mark on the public discourse around fiscal responsibility and government efficiency.
For Musk, DOGE has been a lesson in balancing corporate innovation with the demands of public service. His admission of underestimating the challenge and his focus on Tesla and SpaceX again suggest a recalibration.
As the federal government deals with the fallout from DOGE and its disputed legacy, questions remain about whether DOGE will evolve, be dismantled or just fade away.
FAQs
Why did Elon Musk resign from DOGE?
Musk resigned due to bureaucratic resistance, his 130 day limit as a Special Government Employee and growing legal challenges.
How much did DOGE save taxpayers?
DOGE claimed $175 billion in savings but media and watchdogs dispute the number.
What legal issues is DOGE facing?
A federal lawsuit by 14 states alleges Musk and DOGE illegally accessed federal data, terminated employees and cancelled contracts.
How did Musk’s involvement with DOGE affect Tesla?
Critics say Musk’s government role distracted from Tesla but Tesla’s issues are also due to broader industry trends.
What’s next for DOGE?
The program’s future is uncertain with lawsuits ongoing and questions around its actual impact on federal spending.
Glossary
DOGE (Department of Government Efficiency): government program to cut federal spending
Special Government Employee: federal classification limiting service to 130 days.
Federal bureaucracy: The US federal agency system.
Buyouts: Voluntary severance offers to federal employees.
Sources
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