The new heads of the Department of Government Efficiency (DOGE) have an ambitious plan to cut federal agency spending by up to $2 trillion, targeting a handful of agencies for across-the-board budget cuts. One of the DOGE leaders, Tesla CEO Elon Musk, has said he aims to cut federal spending on the Internal Revenue Service (IRS).

Targeting the IRS

The dynamic duo of Musk and Vivek Ramaswamy have pledged to lead spending cuts across federal agencies, with the goal of slashing the federal budget by as much as $2 trillion.

DOGE leaders say they will pursue budget cuts for federal agencies they consider bloated or outdated.

One of those government agencies is the IRS, Musk said: “The IRS is in trouble.”

Tesla CEO points out that the IRS has suffered from years of inefficiency and scandals while proposing a free tax filing app and conducting audits.

He also wants to lay off a large number of staff, reducing what he sees as "administrative overgrowth".

In a poll on X, Musk asked netizens what the IRS budget should be. The federal agency is asking for an additional $20 billion in funding.

“The IRS just said they want another $20 billion. Do you think their budget should be: Increase, Stay the same, Decrease, Delete?” he said.

Poll results show that 60.6% of respondents want to defund the IRS while 29.9% vote to cut the budget.

Meanwhile, 5.6% said they supported increasing the budget while 3.9% agreed that the budget should remain the same.

Other Agencies in Sight

Musk and Vivek are eyeing a close look at the budgets of multiple federal agencies to cut government spending.

The duo also targeted another financial regulator, the Consumer Financial Protection Bureau (CFPB).

Musk has proposed abolishing the CFPB, raising concerns about the agency's future.

As for Vivek, he wants “massive cuts” to the Department of Education. President-elect Donald Trump has been calling for the department to be dismantled for years, and it looks like that will happen when he returns to the White House.

Vivek aims to cut defense budget

Vivek also criticized the Defense Department's massive budget, saying the Pentagon wastes about $125 billion a year on bureaucracy.

However, Musk-owned SpaceX's $3.6 billion defense contract appears to be exempt from DOGE's budget cuts.

Some critics argue that DOGE's functions overlap with other existing agencies, suggesting that the government's effective regulatory arm may simply be redundant.

The Role of DOGE

DOGE is meant to make government work easier. The name is a reference to Dogecoin, which shows Musk’s importance in the Trump administration. Musk’s role in this department makes people wonder how this might affect Dogecoin’s value and reputation in the market.

After Trump won the election, the value of Dogecoin increased dramatically. This is because Musk is working with the new government and has a history of promoting cryptocurrencies.

Reports suggest that talk of DOGE at campaign meetings has caused Dogecoin prices to rise, suggesting there is a direct correlation between political events and how the meme coin market reacts to them.