The Department of Government Efficiency (DOGE), established to reduce federal spending, has implemented various measures aimed at cost-cutting. However, these actions have introduced both direct expenses and potential revenue losses that significantly impact taxpayers, as well as increase the national debt. Since January 2025, the national budget deficit has continued to grow, reflecting ongoing fiscal challenges. In January 2025, the federal government recorded a deficit of $127 billion, which is $105 billion higher than the deficit in January 2024. By the end of February 2025, the cumulative deficit for the fiscal year reached $1.1 trillion, approximately 18% larger than at the same point in the previous year. February 2025 alone saw a monthly deficit of $307 billion, an increase from $296 billion in February 2024.
Escalating Operational Costs
Initially, DOGE operated with a budget of $6.75 million. However, within weeks, its budget more than doubled to approximately $14.4 million, primarily funded through transfers from other federal agencies. By February 2025, reports indicated that DOGE’s budget had ballooned to nearly $40 million. These rising operational costs raise concerns about the actual financial benefit of DOGE’s initiatives, contradicting its stated goal of reducing government waste.
Cuts to Revenue-Generating Agencies
A major area of concern is the reduction in staffing and resources at the Internal Revenue Service (IRS). DOGE-directed cuts have resulted in the layoff of approximately 20,000 IRS employees—nearly a 20% reduction in the agency’s workforce. This downsizing has severely impaired the IRS’s ability to process tax returns and conduct audits, leading to an anticipated $500 billion decrease in revenue due to increased tax evasion and non-compliance.
Moreover, DOGE’s cancellation of federal contracts has adversely affected companies that contribute to the economy and generate tax revenue. For example, CeLeen, LLC, a Connecticut-based company, saw the termination of contracts totaling nearly $70 million. Such cancellations not only impact businesses directly but also create ripple effects, including job losses and diminished corporate tax contributions.
Negative Financial Impact on Farmers
DOGE’s cost-cutting measures have also inflicted financial hardship on the agricultural sector:
Termination of Essential Contracts
DOGE canceled a critical contract that facilitated payments to thousands of farmers across multiple states. Despite offering no immediate savings, this action disrupted the timely disbursement of funds, undermining farmers’ financial stability.
Cuts to Agricultural Research Funding
Significant reductions in funding for agricultural research projects have led to the termination of critical initiatives, depriving farmers of advancements necessary for improving crop yields, managing pests, and addressing climate-related challenges.
Closure of USDA Offices
DOGE moved to cancel leases for over 100 U.S. Department of Agriculture (USDA) offices nationwide, limiting farmers’ access to essential services such as technical assistance and program support. This decision has hindered farmers’ operations and financial planning.
Reduction in Local Food Program Funding
The Local Food for Schools Program, which connected farmers with school meal programs, faced a $1 billion funding cut. This decision not only harmed farmers who supplied produce but also impacted students who relied on fresh, locally sourced food in their meals.
Impact on Food Banks and Assistance Programs
More than $1 billion in assistance that typically supports farmers and food banks has been cut. These reductions have exacerbated financial strain on farmers who relied on these programs to distribute their produce and maintain steady income streams.
The Bigger Picture: Economic Damage and Costs to Taxpayers
DOGE’s policies have resulted in an economic domino effect that contradicts its intended purpose of efficiency. Rather than saving money, these cuts have increased government inefficiency, harmed key industries, and placed greater financial burdens on taxpayers. With declining revenue from IRS cuts, disrupted economic activity, and increased financial hardship on farmers and businesses, DOGE may be costing the U.S. economy billions—far outweighing any claimed savings.
As these policies continue to unfold, the long-term consequences of DOGE’s budget-cutting approach remain a significant concern for the economic stability of the United States.