Elon Musk’s Plan for the US National Debt.
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basically we’re on a path to to bankruptcy America’s on a path to bankruptcy so we have to cut government spending um or we’re just going to go bankrupt just like a person would as we all know recently Donald Trump won the US election and one person that took center stage in it all was Elon Musk musk was actually one of the Trump campaign’s largest individual Donuts pledging over $100 million to support the campaign but interestingly his involvement with Trump isn’t stopping at just campaign support as Elon is now expected to take an active role within the Trump Administration you might have seen this meme floating around in the last few weeks featuring Donald Trump UFC founder Dana White and Elon Musk with the caption reading we’re looking at the new CEO CMO and CTO of America and in the case of Elon Musk it appears to be true that he will take on a sizable role in the government as head of government efficiency at the suggestion of Elon Musk I will create a government efficiency commission task with conducting a complete financial and performance audit of the entire federal government and making recommendations for drastic reforms and Elon because he’s not very busy has agreed to head that task force so what is Elon musk’s role going to be is it going to be a good thing or is it just going to be one big conflict of interest Elon Musk as was recently confirmed is set to become the head of what he calls the department of government efficiency or you guessed it Doge for short I think the funniest name is is do the the Doge Department of Department of government efficiency and from from what he said so far it seems his primary goal is to Simply cut out all the waste and inefficiency that’s currently seen in the government and from my research this all boils down to two key objectives one reducing the government deficit and two deregulation now I’ll talk about both but I want to start with the idea of reducing the deficit so much like a person the government has income and it has expenses and if it wants to spend more than it earns it has to take on debt to afford it similar to us if we want to buy a new car but we can’t afford it then we have to take out a loan to buy the car now the problem with the US is that every year since 2000 the government has spent more than it earns each year as you can see for fiscal year 2024 the government collected 4.92 trillion in revenue and had 6.75 trillion in expenses in the income column we have 49% from individual income taxes 35% from Social Security taxes 11% from corporate taxes and then smaller amounts from customs duties excise taxes estate and gift taxes and other and then over in the spending column we can see that 22% goes to Social Security 14% to Health 133% on interest 30% on Medicare 13% on defense 10% on income security and then lesser amounts for veterans benefits education transport Regional development and all the other stuff but now this is the important part because the United States government consistently spends more than it earns each and every year that leaves a shortfall and that shortfall has to be made made up by the government selling bonds it’s essentially like an IOU investors give money to the US government and the US pays them back after a certain period of time but the problem with this is these bonds require the government to pay interest and as the debt pile grows and grows so does the interest section on the expenses side of the equation and that only makes the deficit worse and on top of that there’s the compounding Factor at the moment of higher interest rates so because the government runs a deficit when their debts come to they actually can’t pay them back so what they do instead is they will take on new debt to help pay down the old one but the problem with this is if you took on a million dollar of debt at 1% interest and now you have to refinance at say 5% interest that also starts to Snowball the interest expense of the country for the same outstanding debt your interest expense is now higher thanks to the higher interest rates and all of this is what Elon Musk has drawn attention to recently this was him on Joe Rogan a few weeks back this whole idea of this government efficiency agency yeah I mean the idea is is pretty simple is that like we’ve got this suffocating massive Federal bureaucracy government spending is like bankrupting the country our interest payments on the national debt now exceed the defense department budget the defense department budget is like a trillion dollars a year 23% of all govern income income taxes tariffs and everything is just going to pay interest right now and that number is continually Rising so if we don’t do something the entire government budget will be paying interest there won’t be money for anything no there won’t be money for Social Security there won’t be money for Medicare nothing that’s where we’re headed let like hello wake up wake up so we have to cut government spending um or just going to go bankrupt just like a person would if that overspends Elon sees the deficit worsening over time he sees the refinancing of government debt at high interest rates ballooning the interest expense of the country and he wants to change that but the first step in stopping the snow balling pile of debt is to put the US in a position where after all is said and done in a given year it doesn’t need to take on more debt and that means America needs to either increase its income or reduce its expenses to eliminate the deficit and return to a budget surplus and in elon’s planned role as the head of government efficiency he wants to go through and Tackle this issue by eliminating a lot of wasteful spending there are expenditures that don’t make a lot of sense uh that that are wasteful and uh we need to put a stop to that the the there’s so much government waste that’s going on that I would call it a Target Rich environment like you it’s hard in every direction there’s this just mad waste and I think simply if if people simply know that well if if they waste a ton of taxpayer money they’re going to get fired that will immediately improve the situation immediately and this is exactly what he’s got experiencing from running SpaceX Tesla and more recently X at Tesla he focused heavily on streamlining operations reducing costs across the supply chain and enhancing the profitability of the company while improving affordability for their customers SpaceX is a testament to his commitment to optimization where each advancement is aimed at either reducing rocket weight or maximizing cost Effectiveness I mean the whole reason that rocket got caught by the Chopsticks in the first place is because they deleted the landing legs to save weight that’s an optimization and then of course we know most dramatically at Twitter remember that musk was able to implement substantial cost cutting measures notably reducing the workforce by 80% while maintaining the platform’s core functionality now some of those initiatives obviously weren’t popular but they were effective and that’s what he’s all about creating lean and effective operations and it’s that skill set that he now wants to bring to the US government the department of government efficiency you know what that’s going to do is is really just uh take a look at at at all the federal expenditures uh and and say if something is not uh if if you’re not getting great value for money for your hard earned tax dollars cancel it I would like to say it’s a hard job but actually it’s not because there’s so much waste so I I I actually think this is a this is a fairly easy job although we’ll get a lot of opposition naturally um from from the entrenched interest that that get the money and do nothing you know nothing good with it um they’ll be grumpy about it uh but uh the American people will be very happy that their tax dollars are being spent in a much more sensible way and it obviously remains to be seen exactly what Elon will take a swing at but one thing he has discussed quite extensively over the past few weeks and months is government agencies and this now leads us to the second part of the role that Elon wants to take which is improving the efficiency of the government by consolidating or removing government agencies and this has two intended outcomes to reduce the running cost of the government and also to start to deregulate or untangle the overlapping web of bureaucracy that as a function of the system stifles America’s advancement we’re spending money on all these like these government agencies and I like I asked I actually asked the AI like how many government agencies are there and uh the government isn’t even sure how many government agencies there are like so so it’s like somewhere around 450 depending on what you call an agency at the federal level so that that’s almost twice as many agencies as as years that America has existed so we’re creating agencies at roughly two agencies year wow yes this is crazy so we got the suffocating this vast suffocating Federal bureaucracy that just gets bigger every year and and it eventually get to the point where everything’s illegal you can’t get anything done and this is where musk’s perspective on government reform becomes a bit more complex and to a lot of people much more political I think most people can appreciate the idea of trying to write the ship when we’re talking about the deficit but when we start to talk about deregulation this is where people tend to draw their own own lines in the sand some for deregulation and others against now I want to say that I am not at all trying to get political or enforce an opinion onto you guys as I said on Instagram recently I’m just a 29-year-old Australian dude and I don’t think most Americans would appreciate me chiming in and telling them how they should or shouldn’t run their country but I do still want to show Elon musk’s point of view because of course it gives this context as to the topic of this video which is what will Elon musk’s role in the government likely entail and in ‘s view he has been very critical of overregulation in the United States frequently using the football field analogy this is the idea that the game works best when there’s one or two or maybe three referees on the field depending on which football you’re talking about and that makes for an exciting game where the players can play but the rules are still enforced but what you don’t want is for there to be 10 20 50 100 200 referees on the field because as you put more and more referees on the field there’s less and less space and freedom for for the players to play the game obviously breaks down and this is the analogy that Elon commonly uses for the state of American over regulation for SpaceX Starship was sitting on on the pad the rocket we the giant rocket we could build the rocket faster than they could process the paperwork to approve the launch two so we’re sitting there for two months if you’re dealing with one agency that’s one thing but if if you’ve got to deal with five agencies and the agencies will have to meet with each other now you got like 25 different meeting configurations that have to take place you get just hard of the Aries you just can’t make make progress like this is why we can’t build build high high speeed rail in America it’s basically illegal musk’s call for deregulation however obviously isn’t without controversy at the end of the day regulations are often established for safety Environmental Protection and consumer rights so the idea of scaling them back raises legitimate concerns critics worry that loosening regulations might lead to reduce safety standards or fewer protections for the public for example consider the national highway traffic safety administration or nhtsa which enforces Vehicle Safety standards like seat belts airbags and crash tests now while this is admittedly a reasonably extreme example if these regulations were weakened or removed it raises the question would automakers continue to prioritize safety or would they be tempted to cut Corners to reduce costs while they may be potential for streamlining and simplifying the regulatory landscape it’s reasonable to be cautious about the consequences at the end of the day deregulation can have both positive and negative effects here’s musk’s response to these concerns we’ve got far too many government agencies the federal bureaucracy has gotten out of hand and we just need to pair it down to a sensible level and if it turns out that like there’s some regulation or agency that was doing something useful we can put it right back no problem like it’s like oh that regulation was important no problem we put it right back on the surface this approach seems practical right testing out a leaning government and then restoring any crucial regulations if needed but some might argue that it could be risky right if a regulatory body is removed only to realize later that it was actually essential then there could be a period where people are impacted before it’s reinstated and in some cases that temporary Gap could have serious consequences for Public Safety the environment or other critical areas so it’s a fine line to walk in the regulation versus deregulation debate another concern raised is the potential for job losses consolidating or cutting back government agencies would inevitably lead to some layoffs and that’s a tough reality losing a job is hard for anyone and it’s understandable why people worry about this aspect now Elon has addressed this concern directly and in his view he doesn’t want to cause anyone undue economic hardship the point is not that people suffer economic hardship the point is just that they they’re it’s better there are more productive things they can do in the economy and it’s and it would be better if they did these other more productive things and we didn’t have this vast pedal bureaucracy so so like so I was like H you know maybe like a couple years of pay would be good and then they could take a vacation they could take take another job and get double pay I mean it’s like it’s not like a it’s not going to S create create an economic crisis I think it’s actually going to be really good I think because you know people can move to where they’re making products and services that are more useful to their fellow human beings so that’s the argument around potential job losses but beyond that there is one really big issue that definitely does need to be addressed and it’s causing quite a bit of stir right now and that is if Elon is in charge of this deregulation in America was kind of a conflict of interest right if musk takes on this role in the Trump Administration then he would potentially have influence over regulations that directly affect his own companies like SpaceX or Tesla Elon has previously voiced frustration with regulatory bodies such as the FAA which he feels has been slow to improve launches for SpaceX and also with the nhtsa which enforces safety standards affecting Tesla now while a lot of people trust musk’s intentions putting him in a position to alter regulations that impact Industries where he has significant Investments naturally raises concerns this isn’t necessarily a question of musk’s character it’s more about the risks inherent in allowing someone with vested interest to influence government policy in these areas on the one hand there is certainly massive scope for cost reduction in the US government that would definitely benefit America’s Financial position but at the same time there are concerns on the other side of the equation too I think we need to look take a look at all federal expenditures and say is this really benefiting the American people or is it not and if it is well are we spending it wisely usually the answer is no so then should we should spend less money and spend it efficiently but there’s got to be a clear benefit to the American people or we shouldn’t be spending money and and I think we we also want to have extreme transparent y you know so like no Shady back room deals or whatever everything done in the open Total exposure like you can see the mistakes that are made the good things that are done you can comment on it you can you know raise concerns this is we want a transparent open government and you know because there will be mistakes that are made with transparency comes trust you know and then you can see okay we made a mistake we’ll fix that we’ll do that you know and and that that’s that’s that’s the best way to restore trust in government not that you should trust government you shouldn’t trust government but it’ll be you can trust it slightly more if there’s at least transparency so hopefully this video gives you a reasonably balanced look at both the pros and the cons of Elon musk’s potential new role in the US government definitely let me know your thoughts as well down in the comments section below let’s keep the discussion going down there cuz I think this is a really interesting one but beyond that if you did find the video useful please leave a like and if you’ve made it this far through the video and you like what you see please subscribe we’re on the charge to a million subscribers but we do need your help in getting there so if you wouldn’t mind please subscribe we really really appreciate it but with that said guys that will just about do us for this video enjoy the rest of your day enjoy the rest of your week and I will see you guys in the next video by the way I’m in Dubai right now how cool is that it’s pretty cool all right back to regular programming next week I’ll see you then [Music] m [Music]Welcome to Big Money Investing – Your Ultimate Destination for In The Money Facts!
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