On November 12, President-elect Donald Trump announced “the potential Manhattan Project of our time” in a letter published on X by Elon Musk. Of course, Trump was referring to the creation of the Department of Government Efficiency (DOGE), under the co-leadership of Musk and former Republican presidential candidate Vivek Ramaswamy.
DOGE’s mission is to cut $500 billion to $2 trillion from federal spending, which currently stands at a staggering $7.1 trillion as of this writing.
According to Trump, “To drive this kind of drastic change, [DOGE] will provide advice and guidance from outside of Government, and will partner with the White House and Office of Management & Budget to drive large scale structural reform, and create an entrepreneurial approach to Government never seen before.”
On November 20, Musk and Ramaswamy wrote an op-ed in The Wall Street Journal stating, “The entrenched and ever-growing bureaucracy represents an existential threat to our republic, and politicians have abetted it for too long.”
Musk and Ramaswamy are certainly right. In recent decades, the size and scope of the federal government has increased substantially, with little to show except for a mountain of debt and a labyrinth of rules and regulations concocted by unelected and therefore unaccountable bureaucrats.
Fortunately, it seems like the never-ending growth trajectory of the U.S. federal government may finally come to a halt.
To be clear, Musk and Ramaswamy have their work cut out for them; cutting government programs is no easy task.
There is an objective approach that DOGE could apply that would substantially reduce the footprint of the federal government called CPI-X: A Novel Method to Decrease Spending and the National Debt.
In short, CPI-X (CPI minus X) would tether federal spending to the Consumer Price Index (CPI), using the CPI as a baseline, and accomplishing actual spending cuts via the “X” in the equation. The X-factors in CPI-X are derived from benchmarking the spending of the U.S. federal government, states, and other countries along 10 basic policy areas, such as defense, health, education, etc.
CPI-X was originally developed in the early 1980s and used to reduce spending under UK Prime Minister Margaret Thatcher’s privatization plan. In the 1990s, it was also utilized in Australia to regulate the pricing of public utilities. In both instances, CPI-X was successful.
Revolutionary reform concerning how the U.S. government functions and spends taxpayer dollars is long overdue.
For far too long, the federal government has engaged in reckless deficit spending, which has driven our national debt to more than $36 trillion.
To be fair, much of the spending is on autopilot and goes to the big three entitlement programs: Medicare, Medicaid, and Social Security. But there absolutely is an abundance of waste, fraud, and redundancy that must be rooted out.
For instance, did you know the federal government does not even know precisely how many agencies and departments currently exist? According to the National Archives, the number stands at 435, whereas the Office of Personnel Management lists 646.
On the present course, the U.S. government is heading straight toward a fiscal catastrophe. By 2038, unless drastic changes are made, federal spending is estimated to surpass $13 trillion annually. Even worse, that is if no new “emergency” spending measures arise.
Simply put, the federal government’s monumental growth and insatiable appetite for more spending and more new programs must end before it is too late.
The CPI-X model is a feasible plan that can right the ship. For example, “the sustainable spending future derived by CPI-X cuts would significantly reduce federal spending from $7.38 trillion in 2025 down to $3.67 trillion in 2038. That is a 50 percent cut, which adds up to $73 trillion.”
Once again, these would not be across-the-board cuts. Rather, they would be specifically indexed based on benchmarking the spending of the 50 states and several OECD countries along 10 policy areas. In other words, CPI-X would not be akin to taking a chainsaw to the federal leviathan; instead, it would be like using a surgeon’s scalpel.
CPI-X would not obliterate the federal government. Actually, it would bring the federal government closer to what the Founding Fathers originally envisioned.
The Department of Government Efficiency has a bold mandate and should consider CPI-X as a blueprint for how to bring the federal government back to its proper size and scope. According to Trump, DOGE will conclude its efforts by July 4, 2026—the 250th anniversary of the Declaration of Independence. Let’s hope that DOGE is successful in this Herculean task. If so, it would be a wonderful birthday gift to the nation as it celebrates its Semiquincentennial.
Darren Brady Nelson is a policy advisor with The Heartland Institute. Chris Talgo is editorial director at The Heartland Institute.
