The setting up of DOGE, or the Department of Government Efficiency is a major talking point post the Trump victory in the USA. Headed by entrepreneur Elon Musk and former presidential candidate Vivek Ramaswamy, DOGE isn’t an actual government department. It is an advisory body, with a direct line to the new US President Trump. DOGE will identify ways for the federal government to cut costs and become more efficient.
Both Elon and Vivek have long been big advocates of smaller government. Even in India, we have the slogan of ‘minimum government, maximum governance.’ Maybe there is something of value in DOGE USA, from which we can learn to make our own government more efficient. Maybe we also need a DOGE India.
All governments must spend. The spending ranges from paying salaries, running offices, implementing welfare schemes, providing subsidies, building infrastructure, defence, healthcare, police and education, to name a few. Hence, to say all government spending is bad and wasteful is a ridiculous argument.
Government expenses will also always be relatively large compared to the size of a country’s economy. Hence, “smaller government” or “minimum government” are relative terms.
We can only seek to make the government a bit more efficient. And because we are dealing with massive amounts, even a small percentage saved becomes a big sum.
To explain more about what DOGE, Elon and Vivek wrote an open letter in The Wall Street Journal. Here is a key excerpt:
“Our nation was founded on the basic idea that the people we elect run the government. That isn’t how America functions today. Most legal edicts aren’t laws enacted by Congress but “rules and regulations” promulgated by unelected bureaucrats—tens of thousands of them each year. Most government enforcement decisions and discretionary expenditures aren’t made by the democratically elected president or even his political appointees but by millions of unelected, unappointed civil servants within government agencies who view themselves as immune from firing thanks to civil-service protections.”
Isn’t the above also true for India? Sure, the union budget is signed off at the highest levels. However, the proposed scheme plans and actual spending is often done by bureaucrats. Isn’t it possible that some of the expenses can be examined and made more efficient?
The total central government spending budget is roughly around Rs 50 lakh crores (numbers simplified for ease of understanding). If we could save even 5% of these costs, it is a whopping Rs 2.5lakh crores in savings. This amount, for instance, is around the same as the total amount of custom duties India collects in a year. Or around a quarter of the total GST or total income tax or corporate tax collections. The money saved can be spent for better projects. It also improves the fiscal position of the country. Better fiscal finances lead to all kinds of good things such as lower inflation and lower interest rates. Lower interest rates in turn lead to higher investments, jobs and economic growth. Not to mention lower interest rates also “saves” even more in terms of lower government interest payments.
Can we do this? What will it take for DOGE India to succeed?
Elon and Vivek add in their letter:
“We are entrepreneurs, not politicians. We will serve as outside volunteers, not federal officials or employees. Unlike government commissions or advisory committees, we won’t just write reports or cut ribbons. We’ll cut costs.”
It remains to be seen what DOGE USA will finally achieve. However, the “outsider” leadership of DOGE makes sense. DOGE India leadership cannot come from the same politician-bureaucrat ecosystem. Oh, and definitely not from the retired-bureaucrat-and-judge ecosystem. Nothing against this ecosystem. Politicians, bureaucrats and judges do add a lot of value to society. However, cost cutting needs a fresh perspective, ideally from people who have spent their life trying to be efficient. In that sense, entrepreneurs make sense. To turn a profit, they have to keep their expenses in check. We have fabulous Indian communities who are masters at saving costs – banias (almost a stereotype, but yes, they do know money), Jains, Gujratis, Marwaris, the list goes on. Of course, many people from other communities can do this well too. Taking a few experienced industry leaders and empowering them to identify government cost saving opportunities, can be a massive value add for the government and the nation. These leaders would also require a direct line to the top. Elon and Trump are close to each other. His suggestions will have the President’s ear. We would need the same India, where those heading the project must have the ear of the PM and FM.
There will be plenty of actual, implementable suggestions, which almost needs another article. Many will revolve around using tech, having more accurate data to make welfare schemes more efficient (many are being run on outdated 2011 date) and looking at staff re-allocation or VRS type exits.
Every government in the world needs a DOGE, including India. The upcoming budget is an excellent opportunity to see how we can implement a system that will improve government efficiency. A penny saved is a penny earned. And here, there are lakhs of crores to be saved, or lakhs of crores to be earned.