Contrary to What Trump Said, Even DOGE Does Not Claim To Have Identified ‘Hundreds of Billions’ in Fraud
“We found hundreds of billions of dollars of fraud,” President Donald Trump claimed in his speech to Congress on Tuesday night, referring to the cost-cutting efforts of the so-called Department of Government Efficiency (DOGE). That figure is far bigger than the total “estimated savings” reported by DOGE itself, only part of which it describes as a result of “fraud and improper payment deletion.” And DOGE’s estimate is itself dubious in light of the many errors that journalists and analysts have discovered in its published data—so dubious that Manhattan Institute budget expert Jessica Riedl describes the project as “government spending-cut theater.”
Last year, the Government Accountability Office estimated that “the federal government could lose between $233 billion and $521 billion annually to fraud.” So it is theoretically possible to do what Trump claims. But it would not be realistic to expect such results just a few months after getting started, and DOGE does not claim to have identified anything like “hundreds of billions of dollars” in fraud.
According to the DOGE website, the project so far has found $105 billion in “estimated savings,” consisting of “asset sales, contract/lease cancellations and renegotiations, fraud and improper payment deletion, grant cancellations, interest savings, programmatic changes, regulatory savings, and workforce reductions.” DOGE does not say how much of that total is attributable to “fraud and improper payment deletion,” but it is obviously much less than “hundreds of billions of dollars.”
One problem with DOGE’s estimate is that it does not distinguish between one-time savings and annual savings. When it comes to reining in federal borrowing, it’s the latter that really matters. Another problem is that much of DOGE’s calculation remains mysterious. “Regulatory savings,” for instance, are not specified. And while lifting unnecessary burdens on businesses would certainly be welcome, the resulting private savings would not amount to a federal spending cut.
The most fleshed-out components of the estimated savings are grant and contract cancellations, which DOGE has touted on its website and X account. But news outlets have repeatedly identified embarrassing and consequential mistakes in those numbers, including contracts that had not been awarded yet, contracts that were not actually canceled, contracts that were canceled before Trump took office, contracts that were counted multiple times, conflation of contract caps with actual spending, the inclusion of past spending in estimates of future savings, and overvaluation of contracts, such as the notorious data entry error that transformed an $8 million Immigration and Customs Enforcement contract into an $8 billion cut.
What about “workforce reductions”? The Office of Personnel Management reports that 75,000 or so employees accepted the Trump administration’s “deferred resignation” offer, agreeing to quit in exchange for “a severance package of eight months of pay and benefits.” Those departing workers represent about 3 percent of the feder
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