Peter Schiff: Thank You, DOGE!

In his latest podcast from Wednesday night, Peter addresses the renewed buzz surrounding Elon Musk’s Department of Government Efficiency (DOGE). Peter argues that no matter how many cuts are made, the government’s nature ensures that fraud and abuse will persist. Without market forces exerting pressure on bureaucrats, the state has to reason to spend and allocate resources wisely.

To kick off the show, Peter details the bold moves made by the DOGE team operating out of the White House, arguing that their progress—while impressive—is still insufficient for the fiscal challenges ahead:

The representatives of Doge actually have authority granted to them by the president to go through various agencies and departments and try to eliminate what they can without congressional approval, spending that is determined to be wasteful, fraudulent, abusive– and they’re actually making quite a bit of progress. Now, while I think that they are going to be able to make some cuts far more than anything that we saw with the Grace Commission, I don’t think it’s going to be nearly enough to get us out of jail as far as paying for the tax cuts.

Peter then turns his attention to the very nature of government, arguing that waste, fraud, and abuse are inevitable when bureaucrats have no real incentive to be efficient:

They are going to find waste, fraud, and abuse. I mean, anybody who believes that that’s not there is completely naive and doesn’t understand government. … That’s why you want to minimize the amount of government you have, because anything the government decides to do is going to be subject to waste, fraud, and abuse. That’s why it’s a very inefficient process. That’s why you want to completely limit what the government does, because so much is going to be wasted, so much is going to be stolen, there’s going to be so much graft and kickbacks. That is the nature of government. There’s nothing you can do about it.

Peter also discusses mounting evidence of recessionary pressures, including households struggling with debt. He warns that record-high delinquencies in credit card payments are a harbinger of economic distress:

I just read again that delinquencies now are at a 13 or 14-year high. The last time they were this high, we were in a great recession. So normally, in order to get to a point where people can’t make their credit card payments, you’re in a recession. Now, I think we are in a recession, and that’s why people can’t make their payments. But if we’re not in a recession now, just imagine how much worse it’s going to be.

Connecting Fed policy to the fraud DOGE has uncovered, he points out that the current low-interest regime is essentially a giveaway that fuels wasteful borrowing and inflation:

If they’re going to say, ‘Hey, borrow money at 4% and pay it back when inflation is 5%,’ I’m getting free money. There’s no real cost to borrowing. So more people are going to borrow if the government’s going to pay you to borrow. What they need to do is ratchet up interest rates to make borrowing expensive. So fewer people will do it. But they don’t have the guts to actually choke off all that debt-fueled consumption because they know that it will produce a recession and they don’t want that. 

Finally, Peter argues that DOGE should be commended for exposing the character of most politicians and bureaucrats. Even if DOGE won’t sufficiently cut waste, it’ll open many Americans’ eyes to the truth of government:

What’s great about it is a lot of people don’t know this. A lot of people don’t realize how bad the government is. They’re finding out. They’re finally getting their eyes open to the corruption, the criminality that is involved in government. I’ve always said the worst people, the most corrupt people go to government. They’re attracted to government. Even if they’re not corrupt when they go, they get corrupted while they’re there. That’s the only reason they can stay there because if you’re not corrupt, you’re not going to stay in Washington. 

What else can we thank DOGE for? Auditing the gold stored at Fort Knox.