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(TNND) — The Cato Institute, a libertarian-leaning think tank, published a detailed, 23-chapter report intended to help President-elect Donald Trump’s announced Department of Government Efficiency cut the federal government down to “its appropriate size.”
Trump said DOGE, led by Elon Musk and Vivek Ramaswamy, would “drive large scale structural reform, and create an entrepreneurial approach to Government never seen before.”
DOGE won’t be an actual government agency.
Musk and Ramaswamy said in a Wall Street Journal guest article that they would serve as outside volunteers, not federal officials or employees.
And they’ll look for regulatory rollbacks, administrative reductions and cost savings.
Their focus will be on reforms that can be accomplished through executive action, not new laws, they wrote.
Alex Nowrasteh, the vice president for economic and social policy studies at Cato, said they’ve been working on their report for DOGE for a few weeks, but it really builds on decades of his organization’s work.
Cato’s suggestions for DOGE deal with constitutionally limited government, regulation reduction, shrinking the bureaucracy, using the power of executive actions to roll back government rules, cutting spending, and simplifying the tax code.
Nowrasteh said they reference specific statutes, executive orders, regulations and memos so that DOGE, or perhaps Congress, can use the report to take action.
“So, the country needs a reduction in the size, scope and scale of the federal government in terms of both spending and regulations and the size of the bureaucracy,” he said. “Whether DOGE is the appropriate means to achieve those ends is up for debate. What I am very happy about (with) DOGE is that it will shine a spotlight on a lot of problems with inefficient and ineffective government spending on other programs.”
Nowrasteh and his co-author wrote about cutting “the federal government closer to its appropriate size.”
What is the government’s right size in their eyes?
“The federal government tries to basically be all things to all people,” Nowrasteh said Thursday.
The federal government could, at a minimum, be cut in half, he said.
Eventually, with the private sector and state and local governments stepping in for a lot of what the federal government does now, it could be around 90% smaller and still serve the American people, he said.
That 10% version of the federal government would still operate on a $675 billion annual budget, Nowrasteh said.
“I think most people don't realize how large the federal government is,” he said.
Nowrasteh and his Cato colleagues envision a federal government that functions to protect life, liberty and private property. They want a government that “supplies national defense and other goods and services that couldn't be supplied through a free market or through other voluntary interactions by willing individuals. So, there is a role for government. We're not anarchists here at Cato. But that means reducing the role of means-tested and entitlement benefits in the United States. Rolling back the national security state, which is too involved in foreign affairs. Rolling back all manner of regulations ..."
The federal government has 441 agencies that run more than 2,400 subsidy programs, have imposed 188,000 pages of regulations, and buy more than $750 billion a year of goods and services, Cato federal budget expert Chris Edwards wrote in a recent blog.
The wages and benefits for 2.3 million federal civilian workers cost about $400 billion out of a total federal budget of $6.75 trillion, Edwards previously told The National News Desk.
Nowrasteh, likewise, said Thursday that cutting government salaries won’t make a huge dent in our federal spending.
To really make a difference, he said we need to cut spending on entitlement and welfare programs.
Those collectively make up about half of our federal budget.
That would mean cutting Social Security, Medicare, Medicaid, food stamps and more.
RELATED STORY: Americans worried about Social Security's future; expert clears up myths, suggests reforms
Add in defense spending, and about two-thirds of the federal budget is accounted for.
Another 13% of our spending goes to interest on the national debt, he said.
The federal debt, the result of accumulated deficits, is currently about $36 trillion.
Nowrasteh said the national debt is a drag on economic growth, because it sucks up resources that could go to new and productive ways to supply the goods and services that we consume.
The budget can be balanced by cutting spending and by increasing revenue through higher taxes. Nowrasteh said it’s best to cut spending, because higher taxes disincentivize investments in productive areas of our economy.
But Cato does call for tax efficiency.
“So, what we really call for is ... massive simplification of the tax code, broadening the tax base by getting rid of a lot of tax deductions, lot of tax credits, things that distort and reduce tax payments and actually result in more payments going out frequently to people through credits,” Nowrasteh said. “And that will allow us to have a broader tax base. So, more people would be paying taxes, but the rates could be lower, substantially.”
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