President Donald Trump and Major Domo Elon Musk are embarking on cost cutting at the federal level that is making everyone’s head spin. Every day we hear directly from respected news sources that federal employees have been asked to stay at home in several departments, some with compensation and some outright by being laid off. Musk and his twenty-year old efficiency gang are even targeting universities by trying to reduce the funds going to them for maintaining the infrastructure that supports their research missions. No one seems to be immune to the slash and burn approach that Musk and the newly minted Department of Government Efficiency (DOGE) are taking to going after the U.S. federal budget. The Democrats and federal employees are finding themselves just playing defense without a playbook.
The approach taken by Musk and his team is quite clever, if all one is interested in is showing Trump’s (MAGA) supporters that the President means business, and that he will indeed cut the budget. Along with the rapid attack on immigrants and immigration, cutting the federal budget was a key promise that Trump made on the campaign stump. Whether you agree with him or not, unlike the Democrats who promise a lot and then, once elected, deliver very little, Trump is coming through for his supporters. Elon Musk, the main bulwark in Trump’s plan to slash the federal budget and workforce, although elevated to the status of demi-god in a country that only worships financial success, is quite clueless how the United States operates in the world and domestically. The cutting of the federal budget, especially in the way the Trump-Musk team is going about it, will make the U.S. weaker internationally in ways that one would not be able to recover any time soon.
Let’s take the first victim of the Trump-Musk budget cutting plan: The United States Agency for International Development which is the lead organization established in 1961 to implement U.S. efforts to alleviate poverty and disease, to provide humanitarian needs such as education, women’s rights and governance in developing countries. It also supports economic growth in these countries by helping to build capacity and establish governance in a capitalistic framework. With a workforce of about 10,000, USAID manages a little more than $40 billion in combined appropriations. This is less than 0.1% of the Federal budget. There has been significant amount of lament led by people like Nicholas Kristof of the New York Times that eliminating USAID would intensify problems in poor countries across the world. As Kristof puts it, “around the world children are already missing health care and food because of the assault on the agency that Kennedy founded to uphold our values and protect our interests.”
USAID does not seem to impact any American citizen and certainly not anyone who voted for Donald Trump. Eliminating USAID would not elicit any tears from much of the electorate in the U.S. and, believe it or not, not even from those in the developing countries it is supposed to serve. Unlike the misplaced lament of the liberal elite, what USAID does is to help trap most of the developing countries it serves into the American orbit with expensive medicines and farm products, much of which is produced in the U.S. anyway. A country like Mozambique is better off shaking off the shackles of the connection to the United States brought about by USAID and get its medicines on the cheap, i.e. via generic drugs, from places like India and China, and its food support from a myriad of countries that can give a much better terms of trade. USAID being unfunded is a win for the developing countries it has served, and the only loss is for the soft power extended by the U.S. via USAID. And it will be a financial loss for several farmers in the Midwest who will see a significant source of their income disappearing with the demise of USAID. These farmers voted for Trump in droves. American pharma which stood next to Trump will likely see their markets in Africa and South America dropping drastically if not disappearing altogether. These structural changes may not be experienced right away, but MAGA will be shedding more tears than the poor countries that Kristoff is worried about.
The next department that is on the chopping block by the Trump-Musk coterie is the Department of Education. (DOE) Unlike USADD, this is a big department with a budget of around $268 billion. It has the 6th largest budget of the different entities that constitutes the U.S. federal government. Given that much of educational policy is done at the local level with counties and states having a much more significant impact on K-12 education, one might wonder what exactly the Education Department do. In fact, Trump has exploited this information vacuum to tell his supporters that the Department of Education is simply there to brainwash the population and encourage things like transgender rights and Marxism and so on. Eliminating the DOE will also not elicit tears from much of the wider electorate in the U.S. but it should for the MAGA crowd, especially in the South.
A significant part of the budget of DOE goes towards Pell Grants (15%) and support of elementary and secondary education in the states (40%). The rest of the funding (45%) goes towards supporting higher education, especially in state universities. Overall, the federal government spends about 14% of funding for public K-12 education; the remaining comes in varying percentages from states and counties. The twenty states that spend the lowest overall total dollars per K-12 student are Utah, Idaho, Arizona, Oklahoma, North Carolina, Nevada, Mississippi, Tennessee, Texas, Arkansas, South Dakota, Alabama, Indiana, Louisiana, Missouri, Montana, Kansas and South Carolina, Georgia and New Mexico. This more-or-less coincides with the States that spent the lowest amount of money per K-12 student. It also coincides with the states that receive the largest percentage of Federal support per student for K-12 education. The federal government via the Department of Education had to step in and spend around 20% of the money spent in these states to support K-12 education.
One exception is Alaska. The case of Alaska is interesting; it received a significant amount of money and a significant percentage of its spending per student on K-12 education. Alaska spends $21,184 per K-12 student which is comparable to Pennsylvania ($22,203) and Massachusetts ($22,591) but receives 20.6% of this expense from the federal government wherein Pennsylvania and Massachusetts receive less than 12%. The performance of students from Alaska, a long-term red state is worse than the confirmed blue-state Massachusetts.
The upshot of this analysis is quite revealing. If the Department of Education is eliminated, the biggest negative impact will be on the public education of K-12 students in primarily the states that supported Donald Trump over his two election victories. Further, given the potential elimination of Pell grants, most of which go to the poor in predominantly red states, the impact on these states will also be significant. Very few private schools where the rich and upper middle class send their children will be affected. Even though there will be some impact, very few K-12 children who go to public schools in blue states will be affected. Education is highly valued in these blue states. So given both the wealth and the values in these states, state funds will make up much of what is lost because of the demise of DOE. The MAGA voters who have been sold a bill of goods about the leftists and Marxists running DOE may not cry about its elimination until the negative impact hits them. Worse, the cuts on grants to the states to support public education will damage the already precarious educational situation of the United States of America. Don’t forget, we already score below each and every advanced industrial nation in Europe on Math, and even do worse than China and India at the college level.
The initial attack on USAID and DOE being carried out by Elon Musk might be thought of as giving the MAGA supporters some red meat to show that Trump is serious about cutting down the government. These initial cuts are going to boomerang back to the same people who enthusiastically voted for Trump, and worse, totally compromise the international standing of the United States of America.
Anand Anandalingam - Personal Web Site 