Musk creates new power base in Washington with takeover of US agencies

 Musk creates new power base in Washington with takeover of US agencies

By Tim Reid and Marisa Taylor

February 5, 2025Summary

• Musk's takeover causes panic among some federal workers
• DOGE's creation faces lawsuits from unions and watchdogs
• Trump sets out to restructure government

WASHINGTON, Feb 5 (Reuters) - Elon Musk's rapid takeover of two U.S. government agencies has enabled the South African-born billionaire to exert unprecedented control over America's 2.2-million-member federal workforce and begin a dramatic reshaping of government.

The world's richest man and an ally of President Donald Trump, Musk, 53, has in two weeks created a new center of power in Washington as he executes Trump's cost-cutting initiative to reduce the size of the U.S. government.The CEO of Tesla (TSLA.O), opens new tab and founder of SpaceX, Musk has acted swiftly since Trump's Jan. 20 inauguration, deploying teams of current and former employees of his companies as his agents. Musk's actions have fostered a wave of panic among government workers and public protests in Washington and at times have threatened to overshadow Trump's own agenda.Trump's up-and-down trade war with neighboring Canada and Mexico vied this week for space on front pages with Musk's effort to shut down USAID, the Agency for International Development, America's main humanitarian aid agency to the world. Musk's efforts are part of a massive government restructuring by Trump, who has fired and sidelined hundreds of civil servants in his first steps toward downsizing the bureaucracy and installing more loyalists.Americans are witnessing "an extraordinary centralization of power in someone who lacks a top-level security clearance and has not been subject to any Senate confirmation process," said Don Moynihan, a professor at the Ford School of Public Policy at the University of Michigan."Musk has unprecedented and centralized control of the basic plumbing of government," he added. Nonetheless, Musk operates at Trump's pleasure. The president told reporters on Monday that the billionaire had to seek approval from the White House for any of his actions." Elon can't do and won't do anything without our approval, and we'll give him the approval, where appropriate; where not appropriate, we won't. But he reports in. "A White House source said, "those leading this mission with Elon Musk are doing so in full compliance with federal law, appropriate security clearances, and as employees of the relevant agencies, not as outside advisors or entities." Asked who they are more worried about when it comes to the prospect of being fired, an employee of the General Services Administration that manages federal property and services said: "Musk. No one is really talking about Trump. "Trump has put Musk in charge of what both men call the Department of Government Efficiency. Despite its name, it is not a department, Musk does not draw a government salary, and DOGE's creation immediately drew lawsuits from government unions, watchdogs and public interest groups.Exactly who makes up DOGE is unclear. The Trump administration has not released a list of DOGE employees. Nor has it said how they are being paid, or how many have entered each agency. Musk and his DOGE lieutenants have taken over the Office of Personnel Management and the General Services Administration along with their computer systems.OPM is the human resources arm of the U.S. government, overseeing 2.2 million government workers. From there, emails have been sent out in the past week offering federal employees financial incentives to quit. The GSA oversees most government contracts and manages federal property. At least four current and former Musk aides are part of a team that has taken over OPM, shutting out some senior managers from their own computer systems, sources told Reuters. Musk visited the GSA last Thursday, an official said, while members of his team moved into the agency. On Friday, a Musk team gained access to the U.S. Treasury Department's payment system, which sends out more than $6 trillion a year on behalf of federal agencies and contains the personal information of millions of Americans who receive Social Security payments, tax refunds and other monies from government.Michael Linden, a senior official during the administration of former President Joe Biden at the Office of Management and Budget, a powerful agency that oversees the federal budget, said the access by Musk's aides to payment systems gives them extraordinary potential power."They could get to pick and choose which payments the federal government makes," Linden said in an interview.Neither Musk nor the White House immediately responded to a request for comment.Trump has repeatedly said that the federal bureaucracy is bloated and inefficient, and needs to be downsized. He also accuses many federal workers of being liberal ideologues out to thwart his agenda.MUSK EXCEEDING HIS AUTHORITY"Those of us who have worked at Elon's companies can see his fingerprints all over what's happening inside the federal government right now," said Thomas Moline, a former SpaceX senior avionics engineer. "It's a very seat-of-the-pants affair with Elon's loyalists scrambling to execute his every whim and desire as fast as possible."Governance experts say Musk appears to have already gone beyond the mandate granted by the executive order Trump signed setting up DOGE on Jan. 20.That order mandated it to modernize federal technology and software "to maximize governmental efficiency and productivity." Other orders on hiring freezes and recruitment say DOGE should work with other agencies to make recommendations.Musk and his aides appear to be doing much more than simply making recommendations.Employees from DOGE have clashed with security officials over access to sensitive information at the Washington headquarters of USAID and have been heavily involved in the downsizing of the agency.Fear is gripping many civil servants, and they have taken to Reddit, Signal and Facebook to report on what is going on inside their agencies and discuss how to respond. They also warn that DOGE personnel are watermarking and otherwise embedding identifiers like additional spacing in emails to track down suspected leakers.Musk's critics, including Democratic lawmakers, have accused him of a hostile takeover of government. Federal worker unions sued to block Musk's access to sensitive computer systems."We don’t have a fourth branch of government called Elon Musk," U.S. Representative Jamie Raskin, a Democrat from Maryland, told reporters during a protest outside USAID headquarters.'FORK IN THE ROAD'Echoing language Musk used when he slashed Twitter's workforce after buying the social media company in 2022, an email was sent to all government employees titled "Fork in the Road" offering them deferred resignation, a scheme to pay workers through September if they offered to resign by Feb. 6.A second email encouraged government workers to seek more productive jobs in the private sector. Federal employee unions have urged workers not to take the offer, warning it may not be legal, as it is unclear how the payoffs would be funded.Unions representing the employees filed a lawsuit on Tuesday to block the administration's plan to offer buyouts, even as a U.S. official told Reuters that more than 20,000 employees were planning on quitting.Nick Bednar, an associate professor of law at the University of Minnesota Law School, said it was deeply concerning that Musk and his aides have such enormous power over federal personnel and federal payments "when they seemingly have very little accountability."It was also extraordinary that Musk, whose companies have multiple contracts with the U.S. government, had been put in a position that would raise so many questions about conflicts of interest, he said.⍐