Author: Daniel

  • Was it worth it

    When Trump shut down my project as part of closing down USAID,  it was framed as part of a greater push to reduce federal spending and cut the national deficit. Initially, Elon Musk’s Department of Government Efficiency (DOGE) set an ambitious target of cutting $1.8 trillion. Concurrently, President Trump began imposing tariffs on imports from most countries, confidently claiming this would “make America rich again” and boasting about the hundreds of millions in customs revenue pouring in each month.

    The question is, after all the noise and policy changes, how did they actually do?

    The U.S. fiscal year ended on September 30th, with the Trump Administration having been in power for nearly nine of the twelve months. The final numbers are telling:

    • Overall Spending: Total federal government spending came in at $7.01 trillion. This was an increase of $250 million from FY2024 and close to President Biden’s projected $7.09 trillion.
    • Receipts: Total receipts were $5.23 trillion. This was up $300 million from FY2024 but fell short of President Biden’s projected $5.42 trillion.
    • Deficit: The overall deficit settled at $1.78 trillion, slightly lower than the $1.82 trillion recorded for FY2024.

    For all the fanfare surrounding spending cuts and revenue increases, the actual changes to the overall fiscal picture are negligible. The numbers barely budged.

    So, where did the impact fall short?

    Customs revenues did more than double for the year, but this meant an increase from $0.08 trillion to $0.19 trillion. While an impressive percentage jump, it still accounts for only 4% of the federal government’s total revenues.

    Furthermore, the Department of Government Efficiency’s cuts targeted a relatively small part of the budget. For context, in FY2024, USAID’s total spending was just $21 billion, or 0.3% of the federal budget. This negligible saving was then counterbalanced by a dramatic increase in spending on migration enforcement under the same administration.

    The Trump Administration gutted parts of the government like USAID, without achieving a significant reduction in the total cost of government. They significantly increased tariffs without significantly increasing overall revenues. Ultimately, the result appears to be a lot of pain with very little fiscal gain.

  • Predictions for the 2025 Government Shutdown

    The government shutdown that started yesterday is going to be rough. Negotiations between Democrats and Republicans have been minimal since President Trump assumed office in January. The President’s ability to impose his will on the US Government seems nearly limitless. As a USAID contractor, I experienced an early impact when a government agency, previously authorized by Congress, was unilaterally closed. Subsequently, Republicans rescinded some of USAID’s appropriated funds, and President Trump utilized a “pocket rescission” to remove additional funds. While USAID was a prominent example, various grants and contracts across the government have seen cuts, with funds deliberately underspent if they were not aligned with presidential priorities. Given this history of the President disregarding Congressional mandates on spending, I don’t see why Democrats in Congress will approve further funding for his administration.

    There are three potential resolutions to this shutdown.

    The conventional approach involves a compromise negotiated by members of the Senate. Republicans might agree to maintain some Affordable Care Act health insurance subsidies and commit to no further funding rescissions. This could be well-received by their constituents, many of whom face significant increases in healthcare premiums during the upcoming open enrollment. It would also mitigate a key campaign point for Democrats next year. However, President Trump has shown little inclination to compromise with the “Radical Left,” and hardline House Republicans would likely resist increased costs. Without a Republican compromise, Democrats may lack the political leverage to support ending the shutdown.

    A second possibility is for Senate Republicans to end the filibuster for continuing resolutions. The filibuster, a Senate creation enshrined in its rules, has been gradually eroded by both parties over the years. Under President Obama, Democrats removed it for most federal judges, and during President Trump’s first administration, Republicans extended this to Supreme Court judges. The original intent of the filibuster was to compel the majority party to collaborate with the minority to reach agreements, upholding the Senate’s reputation as “the world’s greatest deliberative body.” However, in today’s deeply polarized environment, debates rarely sway Senators’ opinions. Senate Republicans could simply alter the rules and pass the continuing resolution. Senators from both parties have been hesitant to take this step, perhaps reluctant to acknowledge a diminished role for deliberation.

    The most unconventional option involves President Trump instructing the Executive Branch to begin paying its bills. The concept that government must cease operations without a Congressional budget originated from Attorney General Benjamin Civiletti’s 1980 legal opinion, stating that the federal government could not continue without appropriated funds. Government shutdowns evolved into their current form of political theater in the 1990s. In this scenario, President Trump could allow a few weeks for the Senate to attempt a compromise. As pressure mounts to pay essential workers and businesses with outstanding invoices, he could then announce that he is authorizing these payments. It remains to be seen if Democrats in Congress would oppose the payment of federal workers. With Congress having potentially relinquished its role in setting the federal budget, President Trump could assert authority over federal funding allocation. A concerning aspect of this scenario is the possibility that Congressional Republicans might be unwilling to reclaim budgetary control, thereby allowing the “shutdown” to persist indefinitely.

    I hope these predictions are incorrect and that a swift resolution to this situation is found. While government shutdowns may serve political interests and attract attention, they ultimately cause hardship across the entire country, affecting all states regardless of their political alignment.