Elon Musk to cut Federal Reserve’s spending after $2.5B design bill surfaces

Elon Musk said Wednesday he’s considering sending his federal efficiency unit to investigate the Federal Reserve after discovering the central bank is spending $2.5 billion on its headquarters renovation in Washington, DC. 

Elon made the statement inside the White House’s Roosevelt Room, where he told reporters:

“Since at the end of the day, this is all taxpayer money, I think we certainly — we should definitely — look to see if indeed the Federal Reserve is spending two and a half billion dollars on their interior designer.”

The renovation project, which began in 2021, has seen its costs shoot up as the Fed blamed rising prices of construction materials and labor. The total now sits at $2.5 billion. “That’s an eyebrow-raiser,” Elon added. 

His comments came just hours before the Wall Street Journal reported that Tesla’s board had started working with a search firm to find the company’s next CEO. Robyn Denholm, chair of Tesla, later denied the report on X, calling it “absolutely false.”

Elon was in Washington to highlight his Department of Government Efficiency or DOGE, just a week after telling investors he’d spend less time in the capital and return focus to Tesla amid sliding sales and a declining stock price. 

He used the moment to take aim at the Fed, a private entity that doesn’t take money from Congress but instead operates using profits from assets it holds. But in recent years, the Fed has been losing money due to rising interest costs and hasn’t been able to send profits back to the Treasury.

Trump’s DOGE team targets federal costs

Elon’s push to examine the Fed comes as part of a broader strategy under President Donald Trump, who put him in charge of DOGE in January. Since then, his teams have gone from agency to agency looking for waste, cutting staff, closing programs, and digging through sensitive databases.

The Fed, including its Board of Governors and 12 regional banks, holds confidential data about banks and monetary policy that Elon’s people could soon access.

His team’s methods have drawn heavy fire. At the Social Security Administration, DOGE’s access to internal systems caused portal crashes. Critics say Elon is careless with sensitive information and uses weak security protocols. 

But he defended the work, saying DOGE needs the data to track down $162 billion in improper payments every year. He explained fraud thrives because government databases aren’t connected.

“There’s something like 20 million people marked as alive who are not — now, most of those people were not receiving Social Security. Some of them were, but most of them were not,” Elon said. “Dead people should not be receiving unemployment insurance. They’re employed in the afterlife?” He pushed back on the surveillance accusations, calling the process simple data reconciliation.

A federal appeals court on Wednesday blocked DOGE from accessing personal data at Social Security, citing Elon’s own comments that the program is a “Ponzi scheme” as proof it’s a political target of the Trump administration.

DOGE trims workforce and reorganizes hiring

DOGE is also shaking up the federal workforce. One of Elon’s signature efforts is the “Fork in the Road” resignation plan. It gave eligible workers a chance to resign by February and still be paid through September. Around 80,000 employees signed up. By the end of April, about three-quarters had officially left. Agencies spaced out the exits to avoid service disruptions.

“You didn’t wake up one day with 100,000 people leaving the workforce. They are rolling off in a steady manner. That was by design,” said Anthony Armstrong, DOGE deputy and adviser to the Office of Personnel Management. 

He said many agencies have continued buyouts, calling the latest offers “rolling forks.” The second wave of volunteers is more than double the first, and Armstrong expects final numbers to reach into the “hundreds of thousands.”

Though cuts have been deep, Armstrong said they’re mostly voluntary. About 80% of the reductions came from resignations and early retirement offers. Only 20,000 workers have been fired using formal layoffs, while 26,000 new hires have filled essential jobs despite an ongoing freeze. “We’ve actually hired more people than have actually been fired at this moment,” he said.

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