Elon Musk Makes ‘Overstaffed’ Fed Target in Quest for Efficiency

Posted by Admin December 23, 2024 Bussiness

(Bloomberg) — Elon Musk, the billionaire tasked with making the US government more efficient come January, has zeroed in on the Federal Reserve.

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The central bank in charge of protecting the world’s largest economy is “absurdly overstaffed,” Musk wrote on social-media platform X. The remarks were part of a thread beginning when someone posted about the Fed’s latest policy decision. They come after US President-elect Donald Trump also made the Fed a target, arguing he should have a say in monetary policy and the setting of interest rates.

Musk has become one of Trump’s closest advisers as the latter prepares to return to the White House, and is set to lead up a new agency — called the Department of Government Efficiency — along with entrepreneur Vivek Ramaswamy. DOGE, as it’s known, seeks to deliver a leaner, more efficient government, including $2 trillion in spending cuts.

The Federal Reserve Board in Washington and 12 regional reserve banks across the US employed about 24,000 people last year — significantly less than comparable institutions.

In the Eurosystem, which comprises the European Central Bank and the region’s 20 national peers, the central banks of Germany, France and Italy together had more people on their payrolls.

The Fed and Chair Jerome Powell have been a frequent target of Trump, who appointed him during his first term. Recently, he ridiculed Powell’s role as “the greatest job in government,” saying, “you show up to the office once a month, and you say, ‘Let’s see, flip a coin.’”

While Powell hasn’t responded directly, ECB President Christine Lagarde challenged Trump’s gripe, inviting him to come and observe the work of her team in Frankfurt.

“I have thousands of hard-working people — economists, jurists, computer scientists — and I can assure you that they work super hard every day, not just once a month,” she told Bloomberg TV. “We defend the euro, and we fight for the euro, just as the Fed defends the dollar, I’m sure — I don’t want to speak for Jay Powell, but I’m sure that’s how he sees his job.”