Brian Riedl, a veteran federal budget analyst with 25 years of experience, has criticized President Donald Trump and Tesla Inc. CEO Elon Musk-led Department of Government Efficiency’s (DOGE) approach to deficit reduction, arguing that their small-scale savings proposals mask larger deficit-increasing policies that could push the U.S. toward $4 trillion deficits within a decade.

What Happened: Riedl, a senior fellow at the Manhattan Institute, points out that Trump’s first term added $8 trillion in enacted spending hikes and tax cuts to the deficit, with half unrelated to pandemic measures. According to Riedl’s analysis, Trump is now proposing approximately $8 trillion more in tax cuts and spending increases over the next decade.

“I don’t get excited when DOGE cancels $1 billion in government contracts or saves $3 billion in federal workforce reductions out of a $7,000 billion budget,” Riedl stated on X, formerly Twitter. “Not when Trump and Congress are also preparing to add $800 billion more annually in proposed new tax cuts and spending.”

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The budget expert challenges claims about significant administrative savings, noting that even an aggressive 20% reduction in the federal workforce would save only $60 billion while overhauling federal systems might save $80 billion at best.

These potential savings would offset just a small fraction of proposed spending increases, according to Riedl’s calculations.

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Why It Matters: Particularly concerning for investors is Riedl’s warning about structural budget constraints. He emphasizes that Trump has exempted Social Security, Medicare, defense, veterans’ benefits, border security, and interest payments from cuts – categories that represent approximately two-thirds of all federal spending and are primary deficit drivers.

“You can’t significantly cut the deficit just by cutting waste, firing bureaucrats, and defunding immigrants and foreigners,” Riedl argues, highlighting the need for comprehensive reform. “There are no easy shortcuts. You have to stop cutting taxes and then address Social Security, Medicare, defense, and a lot of other popular programs.”

The analysis comes as the GOP Congress prepares potential legislation that could add $325 billion in new spending this year, further complicating deficit reduction efforts. Riedl warns that current fiscal trajectories could lead to $4 trillion annual deficits within a decade.

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