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Week-end Wrap – Political Economy – March 02, 2025

By Tony Wikrent

Musk’s Purges Suddenly Take a Horrific Turn—and Wreck an Ugly MAGA Lie — We can now be depressingly confident that their mass cuts are killing people.

Greg Sargent, March 1, 2025 [The New Republic]

It has a dry, bureaucratic name, but Ready to Use Therapeutic Food has functioned for over a decade as a lifeline for countless starving children around the globe. Manufactured in the United States and distributed by the U.S. Agency for International Development, it’s a paste made of peanuts, milk, and vitamins that alleviates a form of acute malnutrition known as “severe wasting.”

Now the Trump administration has officially terminated a number of current contracts struck by USAID for this lifesaving nutrition, contracts that had called for the paste to be delivered to hundreds of thousands of children, most in Africa, according to the Georgia-based nonprofit set to deliver them, Mana Nutrition….

The full extent of the damage from these cuts—originally set in motion by Elon Musk’s so-called Department of Government Efficiency—is not yet known. But Atul Gawande, a surgeon who formerly led USAID’s global health initiatives, has established, via communications with partners that work with USAID, a list of contracts that were terminated. Among them are programs that offer natal care for mothers and children, that provide netting and other equipment to prevent the spread of malaria, that work to thwart the spread of Ebola and bird flu in dozens of countries, and much more. The cancellations will nix programs that helped tens of millions of people, Gawande notes.

“This is going to be a massive loss of life overall,” Gawande told me in an interview. “Children are likely already dying, and will clearly be dying in large numbers.”

Meanwhile, The New York Times has developed a long list of other terminated contracts, which include programs preventing the spread of polio, treating HIV and tuberculosis, ensuring clean drinking water in war-torn regions, and buttressing public health in many other ways. Tens of milions of people benefited; now they will not.

Hegseth Clears the Way for More War Crimes 

[Daniel Larison, via Naked Capitalism 02-25-2025]

The Secretary of Defense admitted that the reason for removing the JAGs was so that they wouldn’t be “roadblocks to anything that happens.” If top military lawyers don’t serve as roadblocks more often than not, they aren’t doing their jobs properly.

Trump eases rules on military raids and airstrikes, expanding range of who can be targeted 

[CBS, via Naked Capitalism 03-01-2025]

White House point man at Homeland Security shared ‘martial law option’ post to keep Trump in office 

[CNN, via Naked

Capitalism Water Cooler 02-26-2025]

“The Trump administration’s new point man for dealings with the Department of Homeland Security is a former far-right podcast host and election denier who once shared an article calling for ‘martial law’ to keep Donald Trump in office following his loss in the 2020 election. Paul Ingrassia and the Twitter account for a podcast he co-hosted posted the remark and similar sentiments on social media in December 2020 and January 2021, according to a CNN KFile review of deleted and still-active posts by Ingrassia himself and the account of the podcast. The 29-year-old Ivy League-educated lawyer now serves as the second Trump administration’s White House liaison to the DHS, a key role that has historically involved managing the administration’s relationship with the department and overseeing the placement of political appointees.”

STATE OF NEW YORK, et al., v. DONALD J. TRUMP (PDF)

[United States District Court, Southern District of New York, via Naked Capitalism 02-23-2025]

Judge extends block on DOGE’s access to federal payment systems 

[Politico, via Naked Capitalism 02-23-2025] The opinion.

Trump and Elon’s ‘Pointless Bloodbath’ at the FAA Is Even Worse Than You Think 

[Rolling Stone, via Naked Capitalism 02-23-2025]

While air traffic controllers were supposedly immune from the purge, some air traffic control support workers were terminated, the FAA worker says. Rolling Stone separately spoke with a fired FAA employee whose job involved ensuring flight paths account for hazards like cranes and new buildings, as well as another terminated FAA staffer who ensured that pilots are medically able and cleared to fly. No one wants their plane to cross paths with a crane, of course, but the latter role is important, too, given the nation’s ongoing pilot shortage.

Musk has inside track to take over contract to fix air traffic communications system

BYRON TAU and BERNARD CONDON, February 25, 2025 [AP]

A satellite company owned by Elon Musk has the inside track to potentially take over a large federal contract to modernize the nation’s air traffic communications system.

Equipment from Musk’s Starlink has been installed in Federal Aviation Administration facilities as a prelude to a takeover of a $2 billion contract held by Verizon, according to government employees, contractors and people familiar with the work.

Musk’s Starlink gets FAA contract, raising new conflict of interest concerns

Chris Isidore, February 25, 2025 [CNN]

FAA targeting Verizon contract in favor of Musk’s Starlink, sources say 

WaPo, via Naked Capitalism 02-28-2025]

Elon Musk’s business empire is built on $38 billion in government funding

[Washington Post, via The Big Picture February 28, 2025]

Despite the hype, DOGE hasn’t found a shred of fraud 

[Public Notice, via Naked Capitalism Water Cooler 02-24-2025]

“DOGE has claimed it’s rooted out $55 billion worth of spending, a dollar amount that appears to be wildly inaccurate: As of Sunday, DOGE’s website claims it has saved or cancelled $55 billion worth of government contracts. But that same website only accounts for $16 billion in contracts. Half of that comes from an $8 million government contract that DOGE incorrectly identified as being worth $8 billion. Additionally, DOGE has been in some cases simply cancelling contracts that the government has already paid for. Some $325 million in supposed savings are simply contracts that have been repeated in DOGE’s reporting, Politico found. But actual fraud? DOGE has found nothing. None of this has stopped Trump, Musk, congressional Republicans, and their allies in rightwing media from breathlessly highlighting millions of dollars’ worth of spending as examples of fraudulent government programs. Nowhere in those lists of programs — like the USAID initiatives that White House Press Secretary Karoline Leavitt has been lambasting for weeks, including the tortured and incorrect claim that US taxpayers funded ‘condoms for Gaza’ — is anything that even Musk or Trump themselves have identified as ‘fraud.’ Instead, the goalposts for DOGE have silently moved from finding fraud and corruption to simply pointing out and cancelling government programs that Trump and Republicans simply don’t support.”

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By Tony Wikrent

Trump’s assault on the Constitution

Friday Night Massacre in the Military

Joyce Vance, Feb 22, 2025 [Civil Discourse]

[TW: The AP story on Fridaynight’s firing of Joint Chiefs of Staff chairman Gen. Charles Q. Brown Jr. did not include the crucial news that Trump also dismissed all the senior Judge Advocates General (JAGS) for the Army, Navy, and Air Force. In her Civil Discourse substack, Joyce Vance — a former U.S. attorney for the Northern District of Alabama from 2009 to 2017, and currently a professor at University of Alabama School of Law, as well as a legal commentator on  MSNBC — has raised alarms about what all these dismissals mean:]

Is Donald Trump trying to turn the military into a political weapon, just like he’s trying, and at least partially succeeding, in doing at the Justice Department?

….competent military leaders are being dismissed for no apparent good reason.

And that’s the heart of it, why dismiss them? Why on a Friday night? Why so many all and once? And why the Judge Advocates General?

Members of the Judge Advocates General Corps, for instance, respond to legal questions about rules of engagement, targeting, intelligence law, and detainee operations. They are military lawyers whose core functions involve military justice and law of war. They offer advice on questions including what constitutes an illegal order, what is a war crime, what is a constitutional violation. Replacing their leadership with Trump loyalists could have serious implications for how the military reacts in a number of situations, including assisting with mass deportations and policing protests, which they are currently prohibited from doing by the Posse Comitatus Act.

Ominous

Josh Marshall, February 21, 2025 [Talking Points Memo]

President Trump has abruptly fired the Chairman of the Joint Chiefs, Charles Q. Brown Jr., and is replacing him with a retired three star general, Dan Caine. This portends a future grave crisis as the President attempts to restructure the military into one personally loyal to him. Caine has not been a service chief or held a combatant command or been the head of the air forces of a combatant command. So basically he’s held none of the assignments which normally precedes elevation to Chairman of the Joint Chiefs….

In its own way equally ominous, Trump tonight fired the Judge Advocates General of the Army, Navy and Air Force. Among many other things it’s the military lawyers who determine what is a legal order and what’s not. If you’re planning to give illegal orders they are an obvious obstacle.

The Making of Emergencies

Caroline Elkins, February 16, 2024 [The New York Review]

…On January 20 Trump declared not one emergency but three. The first, applying to the southern border, echoed an emergency he had declared in 2019. This time, much like previously, the president can circumvent congress on multiple issues, including military spending. The second emergency designates “cartels and other organizations” as “foreign terrorist organizations” under the International Emergency Economic Powers Act (IEEPA), typically enacted for sanctions. The third is a “national energy emergency” under which Trump can conceivably bypass a host of legal and environmental regulations that had impeded his promise in his first administration to “drill, baby drill.”

In the United States, as soon the president declares a national emergency—a decision entirely within his purview, typically done through executive order—he lays claim to nearly 150 otherwise dormant statutory powers. In his declaration, he must identify which of those powers he is activating….

Most countries today have constitutional provisions for national emergencies, but neither the United Kingdom nor the United States are among them. Only in the past half-century did both countries pass legislation to narrow and regulate the executive’s power to declare a state of emergency: the US’s National Emergencies Act (1976) and the UK’s Civil Contingencies Act (2004)….

…as I was finishing this essay, Trump took to social media channeling Schmitt’s vision. “He who saves his Country,” he posted, “does not violate any Law.”

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By Tony Wikrent

Strategic Political Economy

Why Resistance Alone Will Fail 

Les Leopold, February 14, 2025

Musk’s political economy

[X-Twitter, via Naked Capitalism Water Cooler 02-10-2025]

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By Tony Wikrent

Strategic Political Economy

Franklin D. Roosevelt, State of the Union Message to Congress, January 11, 1944​​​​​​​

[TW: In this speech, FDR proposed an economic bill of rights]

…a noisy minority maintains an uproar of demands for special favors for special groups. There are pests who swarm through the lobbies of the Congress and the cocktail bars of Washington, representing these special groups as opposed to the basic interests of the Nation as a whole. They have come to look upon the war primarily as a chance to make profits for themselves at the expense of their neighbors- profits in money or in terms of political or social preferment….

One of the great American industrialists of our day—a man who has rendered yeoman service to his country in this crisis-recently emphasized the grave dangers of “rightist reaction” in this Nation. All clear-thinking businessmen share his concern. Indeed, if such reaction should develop—if history were to repeat itself and we were to return to the so-called “normalcy” of the 1920’s—then it is certain that even though we shall have conquered our enemies on the battlefields abroad, we shall have yielded to the spirit of Fascism here at home….

The Business Community Is Extraordinarily Stupid. Is a dictatorship good for business?

Hamilton Nolan, February 05, 2025 [How Things Work]

…People often criticize business as greedy. Yes. It is greedy, as water is wet. Understanding corporations as anything other than soulless robots seeking profit is a mistake. This is why it is wise to tightly regulate them and unwise to allow them to do whatever they want. In a related sense, people often say, “Hey, wouldn’t it be in the self-interest of business to pay more taxes and subject themselves to more regulations and and generally push for more progressive values because it would help to create the stable and happy society outlined above, which is good for business in the long run?” Well, sure, but this question misunderstands the fact that the political actions of the business lobby assume that they will always be pushing against some force that is pushing back, and that the progressive forces they are pushing against will be enough to protect the basic structure of democratic society, even as businesses try to undermine it just enough to put money in their own pockets. Businesses want to pick up pennies in front of the steamroller, but they don’t want the steamroller to run them over.

Well fuckers, you have miscalculated. You rats.

The business lobby’s many years of selfish conduct and support for deleterious public policies have produced so much inequality and undermined our democratic institutions so successfully that we are now watching a strongman seize control of our government. Smooth move, you fucks. You grasping roaches. Your efforts have gotten us here. All the Koch Brother/ Federalist Society types who invested so much money in capturing the courts for the right wing have gotten us here. All the nice Chamber of Commerce types who supported the Republican Party even as it radicalized further and further because they wanted those tax cuts have gotten us here….

Shock Doctrine USA

Thomas Neuburger, February 07, 2025 [God’s Spies]

What we’re seeing is not a new autocracy, but the old coup, the one called “neoliberalism,” the one we’ve been watching since Reagan: the complete dismantlement of government-by-the-people till only the rich have rights. It’s not the removal of the big FDR state, but its slow, then faster replacement by an equally muscular state responsive to wealth….

….Carl Biejer highlights this point in a recent paid-only piece, “The shock doctrine comes to America.”

Beijer’s point: This isn’t a new autocracy he’s creating, but the same old tried-and-true shocking. The war’s not being waged by Trump, but by “capital” writ large….

“This is what neoliberals have done over and over again to dismantle the state in other countries.…

“The neoliberals are taking an axe to the government rather than a scalpel, and this means that the left could very well see all kinds of programs related to US empire and the security state undergo some significant defunding. But we should not have any illusions about what is driving this: neoliberal austerity”

The Logic of Destruction, and how to resist it

Timothy Snyder, Feb 02, 2025

What is a country? The way its people govern themselves. America exists because its people elect those who make and execute laws. The assumption of a democracy is that individuals have dignity and rights that they realize and protect by acting together.

The people who now dominate the executive branch of the government deny all of this, and are acting, quite deliberately, to destroy the nation. For them, only a few people, the very wealthy with a certain worldview, have rights, and the first among these is to dominate.

For them, there is no such thing as an America, or Americans, or democracy, or citizens, and they act accordingly. Now that the oligarchs and their clients are inside the federal government, they are moving, illegally and unconstitutionally, to take over its institutions.

The parts of the government that work to implement laws have been maligned for decades. Americans have been told that the people who provide them with services are conspirators within a “deep state.” We have been instructed that the billionaires are the heroes.

Constitutional crisis

Elon Musk Wants to Get Operational Control of the Treasury’s Payment System. This Could Not Possibly Be More Dangerous

Nathan Tankus, February 4, 2025 [Notes on the Crisis]

I try to keep emotion out of this newsletter. I have always tried to write Notes on the Crises in a calm, detached tone so that the information I highlight shines through. However, I must be honest with readers: I’m absolutely terrified…. There is nothing more important on the entire planet than getting Elon Musk and DOGE out of the Bureau of the Fiscal Service and allowing career civil service employees to run the Treasury’s internal payments system without capricious and self-serving interference from billionaires and their allies….

Musk and his cronies are clearly aiming to redesign the payments system to serve their agenda. The most chilling sentence is this one from the Wall Street Journal:

“It couldn’t be determined what DOGE representatives intended to do with their access to the payment system. Musk and his team think the payment system should be overseen by political appointees selected by President Trump, the people said.”

This is not the attitude of people who are trying to simply technocratically make the payment system more “efficient.” They have a very clear and specific agenda, which involves unilaterally cutting spending, particularly spending they perceive to be going to their ideological foes. Is “Wokeness,” the “Green New Deal,” “Marxism,” and “Gender Ideology” going to be the new definition of an “improper payment”? ….

The data the Treasury collects could not possibly be more sensitive. We are talking about hundreds of millions of Social Security numbers, as well as a raft of other specific identifying information….

This system collects between “10,000 – 99,999” social security numbers along with identifying “business” information, including sensitive financial records and “business” bank accounts. Does anyone think that if Musk could get his hands on this information, whether directly or indirectly, he would not use it to go after, say, nonprofits he dislikes? At 3:14am Sunday, Musk pledged to shut down “illegal payments” to Global Refuge, a faith-based organization that exists to provide “safety and support to refugees, asylum seekers, and immigrants from across the world.” Musk messing with ASAP is no hypothetical at all….

In some ways, as enormously alarming at this all is, it’s somehow not the biggest concern that I have been thinking about. For the past 36 hours (writing these words at Midnight on Saturday) my mind has returned over and over to the idea that they have been asking for “source code information” to the Treasury’s internal payments system….

COBOL is the lingua franca of mission critical legacy IT in use since the 1960s and too many systems have been too important to abandon it. “Modernization” has instead been built around making COBOL function somewhere besides a mainframe. The “modernization” of the Treasury’s IT payments infrastructure seems to have constituted a combination of rooting out Assembly code and a basically completed transition of “mainframe” COBOL to an “internally-developed RM COBOL” running on Linux servers. RM COBOL is an update on mainframe COBOL “designed for optimum performance and wide portability across a broad diversity of computers and operating systems.” Most notably, the Treasury’s transition to RM COBOL seems to have involved harmonizing more than 30 different COBOL systems which had evolved separately. It was 30 “dialects” they managed to get to speak one standardized language.

Does Elon Musk understand any of this? Does he have any grasp of the scale and complexity he is trying to reach into and exercise “influence”? Currently the most urgent and profound danger is not what he intends to make this sprawling apparatus do. The most immediate danger is what might break in the process of trying to get this apparatus to do what he wants.

At every step of modernizing this system they have run systems concurrently to make sure the “new” functions as well as the old. Redundant systems are only phased out over long time periods after they have enough data on system functioning to feel confident in the “modernized” infrastructure. This is expensive, time consuming and absolutely necessary to make sure this system functions 100% of the time. Elon Musk, however, has never shown respect or understanding of the concept of a mission critical IT system. All he sees is “inefficiency” because he doesn’t understand that there are some things in this world that need to function no matter what and you spend the additional money to make sure it runs, including when it’s being updated….

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By Tony Wikrent

Strategic Political Economy

We Found the $2 Trillion

David Dayen, January 27, 2025 [The American Prospect]

GRAPH — The Road to $2 Trillion

Elon Musk wants to cut government spending. But the waste in the system goes to elites like him. Here’s a better way to bring down deficits….

This article should come with a warning label: We should not cancel the equivalent of 7 percent in annual GDP all at once, which would trigger a deep recession. But identifying the real sources of inefficiency in our government—the trillions funneled to elites—can preserve resources for programs to help those in need….

Ramaswamy has called for a 75 percent personnel reduction across federal agencies. This would hardly save anything. According to the Congressional Budget Office, there are about 2.3 million federal employees with total compensation in 2023 of $271 billion; that’s 4 percent of the U.S. budget. Federal employees were roughly 4.3 percent of all workers in 1960 and 1.4 percent today. As a result, we’ve seen an explosion in contractors undertaking tasks that government workers used to perform. Nearly three times as much money is spent on contractors than federal workers.

Slashing the federal workforce, almost two-thirds of which is at the Departments of Defense, Veterans Affairs, and Homeland Security, would likely lead to more expensive contractors, and also increase the $247 billion in improper payments the government makes every year….

Physicians for a National Health Program (PNHP), which advocates for a single-payer system, noticed even greater savings potential in the MedPAC report. Traditional Medicare sets a “benchmark” for spending on the average beneficiary. Several studies have shown that MA plans spend between 11 and 14 percent less, because they cherry-pick healthier patients, even after accounting for upcoding to make them look sicker. Increasing denials of care allows MA plans to rake in even more profit.

In all, PNHP found that MA plans charge the government at rates $140 billion per year higher than traditional Medicare….

The government also spends massive amounts of money on prescription drugs. In 2022, U.S. drug prices were 178 percent higher than in 33 other industrialized nations, according to a report funded by the Department of Health and Human Services. Some of these drugs are sold at 20 to 30 times the cost of production and distribution; pharmaceutical profit margins are significantly higher than private-sector counterparts…. Using federal statutes to seize certain drug patents and distribute them to generic manufacturers that charge less would also save billions. But more structurally, we could overhaul the monopoly patent system that gives drug companies exclusive rights to charge whatever they want for a set period….

Of course, moving to a single-payer system wholesale could yield over half a trillion dollars in savings from administrative expenses alone, per the People’s Policy Project. But even if the nation isn’t ready for single-payer, limiting private-sector profit-taking and boosting public provision comes to roughly $490 billion per year….

In 2021, the Congressional Budget Office offered a range of options to take the Pentagon budget down by $1 trillion over a decade. Gledhill estimated significant savings from service contracts, which make up close to half of all Pentagon obligations. Many are redundant or could be done more cheaply in-house. Other possibilities include unwinding ineffective contract orders and bringing in other firms to drive down costs through a competitive bidding process….

Putting a number on Pentagon savings is difficult, but using CBO’s conservative figures would net $100 billion per year. Some people I talked to think that could double. Let’s split the difference and say $150 billion a year.

The kind of procurement reform in service contracts and equipment orders needed at DOD could be replicated across the government, insourcing operations and ensuring that taxpayers aren’t routinely ripped off. The Project on Government Oversight has found that federal employees are almost uniformly less expensive than contractors. The Organization for Economic Co-Operation and Development estimates that one-fifth of government procurement globally is siphoned away through bid-rigging. In the U.S., that translates to $150 billion a year. As much as $521 billion a year is lost due to fraud, according to the Government Accountability Office. As Matt Stoller has written, management consultants with a tendency to do nothing but add bloat cost the government $70 billion in 2023.

GRAPH — The Road to $2 Trillion

…. the tax gap, the distance between tax liability in a given year and actual taxes paid. In 2022, the last year studied, the IRS put this number at an astonishing $606 billion per year. This gap is concentrated among the top 1 percent, who evade $163 billion per year, according to a 2021 Treasury Department report….

…A one-percentage-point increase in the corporate tax rate equals about $13.5 billion per year in revenue. Setting a 25 percent tax rate through stock returns would lead to almost no difference between the nominal and the effective tax rate. For the past couple of years, the effective corporate tax rate has been around 20 percent. Add five points and you’re up to $65 billion per year….

…There are several other major tax expenditures; the Tax Policy Center lists the top 13 as costing between $1.12 trillion and $1.38 trillion per year, depending on the estimate. It’s a dizzying amount of money, funneled mostly from working people to elites….

Trump and Elon Musk Just Pulled Off Another Purge—and It’s a Scary One

Greg Sargent, January 31, 2025 [The New Republic]

…Why is Musk’s DOGE trying to access payment systems inside the Treasury Department? It’s not clear what relevance this would have to his ostensible role, which is to search for savings and inefficiencies in government, not to directly influence whether previously authorized government obligations are honored.

Another question: Did Trump directly authorize Musk to do this, or did he not? Either answer is bad. If Trump did, he may be authorizing an unelected billionaire to exert unprecedented control over the internal workings of government payment systems. If he did not, then Musk may be going rogue to an even greater extent than we thought….

Former officials I spoke with were at a loss to explain why Musk would want such access. They noted that while we don’t yet know Musk’s motive, the move could potentially give DOGE the power to turn off all kinds of government payments in a targeted way. They said we now must establish if Musk is seeking to carry out what Trump tried via his federal funding freeze: Turn off government payments previously authorized by Congress. The White House rescinded the freeze after a national outcry, but Trump’s spokesperson vowed the hunt for spending to halt will continue. The former officials are asking: Is this Treasury power grab a way to execute that?

“Anybody who would have access to these systems is in a position to turn off funding selectively,” said Michael Linden, a former OMB official who is now director of Families Over Billionaires, a group fighting Trump’s tax cuts for the rich. “The only reason Musk wants to get himself in there must be because he wants to turn some things off.”

Senior U.S. official to exit after rift with Musk allies over payment system 

[Washington Post, via Naked Capitalism Water Cooler 01-31-2025]

“David A. Lebryk, who served in nonpolitical roles at Treasury for several decades, announced his retirement Friday in an email to colleagues obtained by The Washington Post. President Donald Trump named Lebryk as acting secretary upon taking office last week. Lebryk had a dispute with Musk’s surrogates over access to the payment system the U.S. government uses to disburse trillions of dollars every year, the people said. The exact nature of the disagreement was not immediately clear, they said.” That’s too bad. Why? “Typically only a small number of career officials control Treasury’s payment systems. Run by the Bureau of the Fiscal Service, the sensitive systems control the flow of more than $6 trillion annually to households, businesses and more nationwide. Tens, if not hundreds, of millions of people across the country rely on the systems, which are responsible for distributing Social Security and Medicare benefits, salaries for federal personnel, payments to government contractors and grant recipients and tax refunds, among tens of thousands of other functions…. ‘This is a mechanical job — they pay Social Security benefits, they pay vendors, whatever. It’s not one where there’s a role for nonmechanical things, at least from the career standpoint. Your whole job is to pay the bills as they’re due,’ [Mark Mazur, who served in senior treasury roles during the Obama and Biden administrations] said. ‘It’s never been used in a way to execute a partisan agenda. … You have to really put bad intentions in place for that to be the case.’”

Trump: We’re Forging A New Political Majority That’s Shattering The New Deal Coalition

[RealClearPolitics, via Naked Capitalism Water Cooler 01-28-2025]

President Donald Trump speaks at the House Republican Issues Conference at the Trump National Doral Miami Resort: “Together, we’re forging a new political majority that’s shattering and replacing Franklin Roosevelt’s New Deal coalition, which dominated American politics for over 100 years…. If we do our job over the next 21 months, not only will House Republicans be reelected and expand our majority in 2026, we will cement a national governing coalition that will preserve American freedom for generations to come. There has never been anything like what’s happened in politics in the last few years.”

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