Pierre Ferraguanalyst of New Street Researchexpressed his support for the role that Elon MuskCEO of Tesla Inc.will serve in the newly announced Department of Government Efficiency, while recognizing the challenges ahead in reforming federal operations.
What happened
“It will be fascinating to see DOGE at work: Elon’s method in a government environment,” Ferragu wrote in X on Thursday, noting potential resistance from “legislators and public officials defending their personal interests.”
The Tesla CEO’s approach to government reform has attracted the attention of prominent figures, including Walter IsaacsonAmerican journalist known for his acclaimed biographies of influential figures, including Henry Kissinger, Benjamin Franklin, Albert Einstein, Steve Jobs, Jennifer Doudna and, more recently, Musk himself.
Isaacson recently appeared on CNBC’s “Squawk Box” to discuss Musk’s new challenge to lead DOGE and his relationship with Trump.
Isaacson said Musk’s management of DOGE will be different from his previous approach at Twitter, now X, where he reduced the workforce by 80% to increase efficiency. Unlike his private ventures, DOGE will be a federal agency, meaning Musk will not pay employees directly.
Isaacson also emphasized that Musk possesses significant influence in the defense industry and noted that Trump’s support will play a key role in shaping Congress’ response.
The comments follow the President-elect’s announcement Donald Trumpwhich nominated Musk and the former presidential candidate in November Vivek Ramaswamy leading DOGE, a new initiative to restructure federal agencies and reduce annual government spending by $6.5 trillion. The department will need to complete its work by July 4, 2026.
Why it matters
Musk, who has spoken out in favor of reducing government spending, called the initiative “a shock wave to the system.”
His appointment comes as he continues to challenge traditional approaches to government spending, recently criticizing military programs such as Lockheed Martin Corp.’s F-35 estimated to cost $1.8 trillion.
Financial experts have assessed the potential impact. Mario Georgiou, analyst at InCred Global Wealth U.K.suggests that the initiative could produce annual savings of between $50 billion and $100 billion, although that is a small fraction of the $6.7 trillion projected for the federal budget.
The department’s mandate includes restructuring federal agencies, reducing regulations and implementing accountability measures. While expressing optimism about DOGE’s potential success, Ferragu noted that it will be “a tough and fascinating fight,” underscoring the complexity of bringing private sector efficiency to government operations.
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