Chaos and instability are at odds with growth and abundance.
The Big Picture
DOGE (Department of Government Efficiency) is a great idea in theory. However, its execution leaves a lot to be desired. Rather than taking a methodical and rigorous approach and perhaps starting with the least likely programs to break the government, DOGE is focusing on low-hanging fruit that scores political points rather than pursuing meaningful reform.
The same can be said of President Trump’s “flood the zone” approach to executive orders. The near-constant state and threat of change creates chaos and uncertainty – the very opposite kind of environment investors, entrepreneurs, and businesses look for.
Right-sizing and modernizing government is imperative to prevent our impending fiscal catastrophe and to keep up with a fast-moving modern world. As we’ve discussed at the IC, we can’t right the fiscal ship without talking about entitlements. What DOGE is actually saving taxpayers is a rounding error on our balance sheet.
Since DOGE has begun issuing pink slips and canceling contracts, we have seen cuts at the National Nuclear Security Administration (they build and maintain nuclear weapons), only for those firings to be frantically brought back after realizing the importance of these roles. We’ve also seen cuts at FAA (Federal Aviation Administration) for FAA radar, landing and navigational aid maintenance personnel. Then, the U.S. Department of Agriculture let go of folks working on containing the bird flu outbreak.
For DOGE to have lasting and meaningful reform at shoring up government waste and increasing efficiency, a more serious strategic approach is needed, likely with the help of Congress.
Meanwhile, all of this uncertainty is causing second guessing in the market.
Zooming In
Business and free enterprise favor stability and predictability. They do not particularly appreciate the opposite, which is, unfortunately, the environment that DOGE is inadvertently creating. The flurry of executive orders and related court cases only heightens the instability of the business environment.
Our data indicates that Millennials and Gen Z voters see entrepreneurship as more accessible than it was for their parents. For entrepreneurs from these two generations, this uncertainty is likely to have a severe impact. In a chaotic environment, investors are less likely to deploy capital and take risks. Businesses are less likely to expand and hire workers. Why should they reinvest profits into their businesses and expand if they are unsure about the future business landscape? Why create new jobs in agriculture, manufacturing, or import/export when the threat of tariffs looms like the Sword of Damocles?
Small agricultural businesses may face challenges in making adjustments until the next planting season, which could be months or even years away, depending on the growing cycles of their crops. Hopefully, DOGE will take a more precise approach here.
What about the auto industry? Thanks to the Cato Institute, we can explore the potential impact of these policy disruptions. The Wall Street Journal adds even more: “Detroit manufacturers General Motors, Ford and Stellantis and their suppliers are heavily reliant on shipping goods back and forth across the U.S. land borders and have been lobbying the White House intensively to keep trade barriers within North America to a minimum.” As car prices rise for both used and new vehicles, the effect of multiple border crossings for parts will further contribute to this ongoing increase. Small and medium-sized enterprises that service large auto companies may be pushed out of business. Meanwhile, consumers are left to shoulder the expense.
If tariffs on Mexican imports are implemented, we will see the cost of food go up faster than the recent impact of the avian flu on egg prices. We imported $8 billion in agricultural goods from Mexico in the first two months of 2024. All year accounted for $21,899,956,402. Add a 10 or 25 percent tariff, and everyone’s food budget just got wrecked. There goes the local restaurants, cafes, and coffee shops.
The Data
Independent Lens
Independents do not want chaos. Our polling has repeatedly shown that they want cooperation and affordability. Haphazardly cutting programs, threatening tariffs, canceling contracts, and generally being a chaos agent do not inspire consumer or entrepreneur confidence.
Additional Resources
Gen Z and the End of Predictable Progress – Kyla Scanlon
