By Haddon Libby
The first 30 days of the second Trump administration has seen his administration act quickly to fulfill many of campaign promises.
One of the efforts gaining the most attention is the efforts of the Department of Government Efficiency (DOGE) that is spearheaded by Elon Musk. Musk has stated that their efforts are already saving the US government $1 billion/day with sites set for $4 billion/day by the middle of next year. Musk states that it will take $4 billion/day in spending cuts to reduce the government deficit by $1 trillion annually.
What has DOGE done so far?
- $1 billion in annual savings from cessation of Diversity, Equity and Inclusion (DEI) projects.
- The Institute of Education Sciences, the research arm of the Department of Education has seen more than 150 contracts cancelled. Expectations are for the elimination of most functions by the Education Department, returning such decisions to the states.
- Several federal technology infrastructure contracts have been terminated along with many other consulting contracts.
- DOGE has begun cancelling many leases on unutilized federal buildings. The next step is to sell unneeded government buildings and properties.
- Eliminate many of the activities of USAID and consolidate remaining programs into the State Department.
Other early efforts by the Trump administration include:
- Ending birthright citizenship and increasing border security with US and Mexican troops at the border.
- Cracking down on fentanyl by pressuring Mexico and Canada to make serious efforts to stem the flow. China is the primary culprit shipping fentanyl via these countries. Trump has designated drug cartels and gangs as foreign terrorists.
- Where the Biden administration put an embargo on subsidized steel from China, they allowed this same steel into the US via Mexico and Canada. Trump ended this charade.
- Pardoned anyone imprisoned for actions during the January 6, 2021 storming of the Capital.
- Removed the United States from the World Health Organization while removing ‘non-binary’ and ‘other’ from federal documents asking what a person sex is.
Many of these early initiatives taken by the Trump administration were outlined in Project 2025, a policy blueprint developed by the Heritage Foundation, a conservative think tank. Some of the key initiatives of Project 2025 include:
- Downsizing and reducing the scope of federal agencies. As an example, move many of the efforts of the Education Department to the state level. Along with this, they proposed banning critical race theory and gender ideology from the classroom.
- Implement a flat income tax and reduce corporate taxes. Early indications are that the Trump administration may be eliminating taxation on social security benefits, cutting the top capital gains tax to 15% and using tax incentives to get corporations to manufacture products in the United States.
- Reduce federal funding for renewable energy projects while encouraging greater fossil fuel production. An early example of this was ending Biden’s ‘pause’ on the construction of facilities used in the production of Liquified Natural Gas (LNG). For whatever reason, Biden stopped this effort to keep LNG prices ‘stable’ while reducing exports. This caused problems in the European Union due to its reliance on Russian gas.
- Decrease federal funding for climate initiatives.
- Cut Medicaid and Medicare programs. So far, the Trump administration has stated that it will not reduce benefits to seniors. Project 2025 also wants to make abortion more difficult while reducing reproductive health programs.
- Promote Christian values and remove ‘woke’ programs that spawned during Biden’s tenure.
With Republicans controlling all branches of government, we are certain to see more changes over the next two years. If these efforts meet the approval of a plurality of Americans, we are likely to see Republicans retain full control. If efforts go too far, expect the Democrats to gain an opportunity to flip the House of Representative and/or Senate in 2026 elections.
Haddon Libby is the Founder and Chief Investment Officer of RIA firm, Winslow Drake Investment Management. For more information, please visit www.WinslowDrake.com.
