Elon Musk says he can slash US budget by $2T
Elon Musk, the world's richest man, has claimed that he can slash the US federal budget by $2 trillion. Speaking at a Donald Trump rally in New York's Madison Square Garden, he stressed that if Trump becomes president, the government will cut back on spending. "Your money is being wasted," Musk said, adding, "We're going to get the government off your back and out of your pocket book."
Musk's proposed budget cut represents significant federal spending
The proposed $2 trillion cut would amount to nearly one-third of the current federal spending. The Treasury Department reported that the federal government spent $6.75 trillion in fiscal year 2024. Asked about possible cuts from the budget under President Joe Biden and Vice President Kamala Harris, Musk confidently replied, "Well, I think we can do at least $2 trillion, yeah."
Musk's political donations and potential conflict of interest
Having donated at least $132 million to support Trump and other Republicans in 2024, Musk is among the top political donors this cycle. His involvement goes beyond donations. He has appeared on stage with Trump and held independent rallies. However, critics argue Musk leading a new initiative called the Department of Government Efficiency (DOGE) could be a conflict of interest as his firms, Tesla and SpaceX, have significant federal contracts and benefit from government spending.
Trump's tax proposals and economists' warnings
While Trump has spoken about reducing federal debt, he hasn't mentioned which programs he would cut. His campaign is littered with tax cuts for different voter groups, with economists cautioning these cuts could balloon the deficit. On Sunday, Trump unveiled a tax credit proposal for family caregivers but didn't offer funding details. His tax proposals target different groups including tipped workers and senior citizens.
Harris's tax proposals and Trump's deregulation efforts
Harris has proposed expanding Medicare for home care services and increasing tax credits for parents, planning to offset these by raising taxes on wealthy households and corporations. Meanwhile, Trump promised deregulation efforts and tax cuts to boost domestic manufacturing. He aims to lower the corporate tax rate to 15% from 21% and impose tariffs on imports from both allies and adversaries, despite economists' caution that tariffs may not cover his tax cut costs and could raise expenses for US households.
