Does Elon Musk actually know what efficiency is?

The world’s richest man appears to have taken up a new hobby: slashing and burning America’s public service, while not getting bogged down by silly little things known around the world as “the facts”.

After all, why would he? Facts aren’t fun. Or, at least, they’re certainly not as fun as wielding a chainsaw on stage, which also appears to be Elon Musk’s new hobby.

Elon Musk with the chainsaw he was given by Argentinian President Javier Milei (right) at the recent conservative political conference in the US.Credit: AP

Other newly acquired hobbies of the increasingly eccentric billionaire’s include: telling people who have dedicated their careers to improving the lives of others (while taking home relatively modest salaries) that their services are no longer required.

It would almost be funny if it wasn’t so sinister. But thanks to the second coming of Donald Trump and his appointing Musk to oversee the Department of Government Efficiency (known as DOGE), a once alternative universe has become our new reality.

In case you missed it, Musk helped Trump campaign on the promise of cutting what they deemed to be wasteful spending of public money. Given the US federal budget in 2024 was close to $US7 trillion, it’s totally plausible that somewhere in there, there’s some fat to be found and trimmed.

Credit where it’s due, Musk has wasted no time in identifying what he deems to be savings because in the six weeks since Trump returned to the White House, DOGE staff have sacked nearly 300,000 federal workers.

I, too, would be feeling petrified too if my livelihood was reliant on the whims of two mercurial billionaires.

Collectively, this is set to “save” an estimated $US270 billion. Don’t get me wrong, that’s a lot of money by any standards. But in the scheme of the overall budget, it’s a saving of around 4 per cent. What’s more, the potential ramifications from these job losses could end up costing America far more than that.

Here’s just one example: Across the National Parks Service and US Forest Service, as many as 3400 employees have been laid off. At a top level, this will mean that when Americans next visit a national park, there will likely be more rubbish and longer lines.

That’s annoying, sure, but they’re not exactly the kind of costs that will set the taxpayer back tens of millions of dollars. But, if someone gets injured or lost within a park, there’ll be fewer search and rescue staff, which could literally be the difference between life and death for some visitors, and could put greater demand on emergency services, which does add up.

Beyond that, fewer staff means less fire preparedness, and fewer staff on hand to fight fires.

That means that if and when a bushfire breaks out in a national park it will likely be more severe due to prevention work not being carried out, and that it will rage for longer due to bussed-in fire crews working in an unfamiliar environment which, again, actually does add up well into the tens of millions of dollars quickly.

Then, there’s education, where Musk has made over $US900 million in cuts, namely to research programs. These include studying and comparing the academic performance of American students to other nations, researching attendance rates and behavioural changes in classrooms post COVID-19, and improving learning supports for students with disabilities. That these cuts come at a time when US reading levels are at a historic low makes the matter even worse.

If Musk really is as brilliant a mind as he and Trump seem to believe he is, surely he can understand that a population with low education rates and poor school attendance is a recipe for long-term economic disaster. All of which then begs the question: does Musk actually understand what efficiency is?

Musk seems to believe that simply turning off the tap saves money. But anyone with even the most basic understanding of finances will tell you that’s not true.

Say, for example, Musk suddenly told Americans to stop going to the doctor every time they felt unwell, as a way for them to save money. Sure, that might save you a couple of hundred dollars in the short term, but what about the long term, when it turns out something serious was missed and you end up in the emergency room?

Or what could have been a preventative treatment ends up being palliative care? Suddenly, that small saving becomes a major expense.

Another example of short-term goals with unintended costs comes when we look at the government employees who Musk hasn’t fired. Last week, Musk advised government staff via his social media platform X, and an email with the subject line, “What did you do last week?” that they would be required to send a weekly email outlining their achievements in the previous five days.

Initially, Musk noted on X that anyone who failed to send such an email would lose their job. Many employees took this as a threat, which understandably has piled even more stress onto them after weeks of insecurity and uncertainty.

I don’t blame them. I, too, would be feeling petrified too if my livelihood was reliant on the whims of two mercurial billionaires.

The problem with stress, though, is that it makes people remarkably inefficient. When we’re anxious, we’re unable to work as effectively or confidently as we would when we feel calm and when we have certainty about what we’re doing and why we’re doing it.

Basically, Elon Musk’s quest for maximum efficiency is making people less efficient – which will likely cost Americans far more than the savings he’s trying to find, and in more ways than one. Remind me, how is this good business?

Victoria Devine is an award-winning retired financial adviser, bestselling author and host of Australia’s No.1 finance podcast, She’s on the Money. She is also the founder and co-director of Zella Money.

• Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.

Expert tips on how to save, invest and make the most of your money delivered to your inbox every Sunday. Sign up for our Real Money newsletter.