GREG BECKER: Musk’s department of government efficiency would shake up SA

With Donald Trump winning the US presidential election, Elon Musk will add another job to his portfolio: head of the soon-to-be-created department of government efficiency, referred to by its acronym Doge. Musk is partial to titles made in jest, but his stated goal of shaving $2-trillion — a stupendous amount not far off the GDP of Africa — from the US’s annual federal budget is no joke. If he gets this right, a model for rationalising public services and expenses will be on display for all to see, and for other countries to copy.

US debt-to-GDP ratios have risen rapidly in recent years, from about 56% in 2007 to 110% in 2024. With interest rates rising, this has meant that more than 20% of revenue is being spent on interest payments. Reining in non-interest expenses now will ensure that debt doesn’t grow (as a percentage of GDP), and that the long-term credit rating of the US doesn’t deteriorate with a concomitant risk premium.

Musk plans to implement zero-based budgeting, and to consider every agency and contract individually, assessing whether they are “in the interests of the American people”. The approach is reminiscent of Argentinian President Javier Milei, an economics professor who promised to bring a chainsaw to government expenditure if elected. Since his inauguration, Milei has reduced the number of Argentinian ministries from 18 to nine.

Musk has spoken of reducing the number of federal agencies from more than 438 to fewer than 100, and to do so in a humane way: Musk plans to give those who will be let go a soft landing — two years’ salary, which should be enough time for the enterprising to reskill and find alternative employment in a market in which unemployment rates have been below 5% for a long time.

SA is markedly different, notably in terms of unemployment rates, the size of the informal economy, our debt level, the cost of our debt and our sovereign credit rating. In a way we are already trying to cut costs by giving the highly paid early retirement opportunities, but a much more widespread approach is needed, with a much more critical eye.

Oversized cabinet

What changes would a Musk-run Doge introduce in a country such as SA?

He would have an obvious starting point: our oversized cabinet. The US cabinet has 26 members, which is much smaller than SA’s, which has 34 cabinet ministers and 38 deputies for a total of 72. He could start by firing all deputies, and rationalising the ministerial handbook, taking out the need for cars, offices, a special medical aid, security, and so on. He may not see a need to rebuild parliament in Cape Town either.

Musk knows that we are a republic and he is observant enough to note that we have a minister of co-operative governance & traditional affairs controlling a budget that funds various monarchies out of taxes being levied on those who aren’t subjects. That should be enough to put a target on its back, but if Musk copied Milei, the sports, arts & culture and tourism ministries wouldn’t last much longer either. Musk would be a tough debate opponent able to attest to the private sector’s capacity regarding science, technology and innovation, and he could pointedly ask why the state should be involved.

One of the ways Musk plans to cut costs is to return to a meritocracy, and in doing so to get rid of all diversity, equity and inclusion programmes. In SA, this would be the death knell for the ministry of women, youth & persons with disabilities. BEE, especially the not-so-broad-based variety that was the cover for much of state capture, would not survive his critical thinking, especially since it has been 30 years and the EU has told us that this is the biggest impediment to foreign direct investment from the EU.

Turning to education, Musk may put all national ministries of education to the sword, possibly replaced by a single ministry in each province covering children of school-going age. Musk has sponsored an X-Prize to do with technology-assisted education, which is likely to result in more learners in more classrooms.

Rude awakening

There would be greatly reduced funding for higher education, largely limited to loans to learners, and National Student Financial Aid Scheme would survive only if it could demonstrate improved efficiency and introduce stricter standards, ensuring that a much higher proportion of loan recipients gain a qualification in return for their student debt. Skills levies — payroll taxes paid to sector education and training authorities (Setas) — are unlikely to survive a rigorous cost-benefit analysis.

Musk is planning on shaking up the military-industrial complex, which has been incentivised to agitate for US involvement in conflicts. SA’s ministry of defence would be in for a rude awakening: those based at the Youngsfield and Wynberg military bases would battle to make a case for their continued existence since the end of the Anglo-Boer War, the business case for our submarines may always have been underwater, and the costs and benefits of our air force need to be re-evaluated to see if it flies, especially since we have so few aircraft and helicopters in active service. Our collective memory of the arms deal would make it very hard to advocate for another while the number of teaching positions are being cut, and money for grants and service delivery still has to be found.

Musk has indicated that the US public broadcasters will be in his crosshairs — partly because they have been partisan, and partly because their offering has been supplanted by private sector alternatives. Applying similar logic, the SABC should be broken up and sold, with various parties continuing the stations the state has played. Enterprising radio and print media may quickly vertically integrate into other media, and the move to on-demand streaming may accelerate this, especially if Starlink was approved as the last act of the minister of communications & digital technologies before that was wound up.

We are not one of the more than 100 countries in which Starlink is available, which already includes six of our Southern African Development Community neighbours: Botswana, Eswatini, Malawi, Mozambique, Zambia and Zimbabwe.

Many other state-owned entities that drain resources may be told to stand on their own two feet or file for bankruptcy, including Armscor, the Central Energy Fund, Denel, the Independent Development Trust, the Land and Agricultural Development Bank of SA, PetroSA, SAA and the SA Post Office. That SAA is still flying at taxpayers’ expense is astounding.

Operation Vulindlela may benefit from Musk’s weekly questions about what progress has been made, what the snags are, how he can help unblock them and what the plans are for the coming week. Those who are incapable will be quickly found out and removed, and with a year of concerted effort and aggressive leadership, Operation Vulindlela would finish its task list in a way that is reminiscent of the way the backlog at home affairs was overcome.

With a firm hand, we could end up like Argentina with less than 10 ministries by the end of the rationalisation and a balanced budget with room for grants and more service delivery. There would be some losers, but many more winners, all looking at a more prosperous future.

• Becker, a retired actuary and recently qualified maths teacher, is founder of MyTutor.chat.