Elon, Inc.Emergency Episode: Nothing Stands Between Elon and Treasury's Payments System
In a week of unprecedented action (and chaos) from both Elon Musk and the Trump administration, breaking news this weekend brought the Elon, Inc. team together for an emergency episode. The New York Times broke the news, and the Washington Post followed, that Musk’s Department of Government Efficiency was given access to the Treasury Department’s payment system. This system, which handles a big chunk of the government’s money transfers, including Social Security, is normally administered by a small number of non-political appointees, and it was reported that Musk’s desire to get in the gears drove a career Treasury official out of the department late this week.
This is a big deal. Musk has many apparent conflicts of interest, and beyond the finances, this is where sensitive information about American citizens is stored. To discuss this development, host Max Chafkin is joined by Sarah Frier, Big Tech editor; Kurt Wagner, social media reporter; and Dana Hull, who covers Musk for Bloomberg News.
Well, Elon muskis now the richest person on the planet.
More than half the satellites in space are owned and controlled by one man.
Well, he's a legitimate, super genius, legitimate.
He says.
He's always voted for Democrats, but this year it will be different. He'll vote Republican.
There is a reason the US government is so reliant on him. Alon Musk is a scam artist and he's done nothing of him.
Anything he does, he's fascinating people.
Welcome to Elon Ink, Bloomberg's weekly podcast about Elon Musk. I'm Max Chafkin, and we are recording this at five pm Eastern Time on a Saturday here on the East Coast because we got breaking news. The New York Times reported that Musk and Doge have successfully gotten inside the Treasury Department's payment system. These are the computers that control the disbursement of much of the federal government's money. This is something a top Treasury official was reportedly trying to stop just before he exited the administration.
And to talk through this and.
The rest of the Musk bake breaking news, I'm joined by Sarah Fryar, Bloomberg's Big Tech boss. Hey, Sarah Hi, And we've got Dana Hall, Elon Musk reporter, Hey, Dana, Hey, Hey, And Kurt Wagner Bloomberg social media reporter and also the guy who wrote the book on Twitter. Oh that's terrible, Kurt.
I'm sorry.
That's a great shout out. I'll take it. Hey, Max, Happy Saturday.
How's it going?
So guys, just to let's just start by like setting the table. Dana, you want to try to take us through what happened here.
I mean, it's a really fast moving story. But basically, it sounds like the Treasury Secretary has given Elon Musk and his Doge counterparts like access to the Treasury payment system. And Senator Ron Wyden wrote a letter about this that was published late last night, and it sounds like it's just an unprecedented amount of access that Musk and his comrades have to the way that the federal government actually pays its bills and disperses payments.
And Sarah, this is coming in amid a kind of week of chaos, right, it's.
Very hard to pay attention to what's happening given everything else that surrounds it. We've got the tariffs, we've got the plane crash. There's so many critical things that are taking up the headlines right now, but this is coming in the midst of a lot of uncertainty, a lot of silence on the behalf of these agencies as their workers get these emails telling them, you know you can, you can take a government buy out and lose your job. As data is coming down from websites like the CDC and the Census, as a lot of agencies and others who do business with the government are being told to cut all their DEI spending and resources in order to receive money from the government.
And it goes beyond that because like federal workers, I mean, if you're talking to federal workers right now, there a lot of them are just like confused. You have these kind of weird offers and the suggestion that maybe they'll they'll be resigned or laid off. There's like tons of fear in the federal workforce. You also have these kind of reports of random musk associates, some of whom work for the federal government, some of whom don't work for the federal government, like just like barging in.
To various parts of the bureocracy. If you're on Reddit, right now.
The Reddit forum where government workers are, It's like Thunderdome. It's just like one post after another of people who are confused, scared, outrage, or just kind of befuddled. Kurt, I mean, you wrote a book about eline kind of chaotic takeover of Twitter.
Now, x I feel like we've seen this movie before.
I mean, these moves really echo kind of what he did after taking over Twitter.
Yeah, it's honestly like a little bit spooky the similarities between these two, right. I mean, you could see just in the headlines alone, Right, you see Elon sleeping at the office to try and get things done, working on the weekends, right, trying to power through everything. You see him eliminating people from essentially their access to be able to do their jobs without any warning. Right suddenly they just show up and they're no longer able to get into the systems that they use for their jobs. You saw, we all saw that email that came this past week, the fork in the Road, right.
The same subject line, He used the.
Same subject line exactly, and at Twitter it was very much a hey, you either opt into you know, my version of Twitter, my hardcore version of what this is going to be, or there's the door and you can let yourself out. And so we're seeing this playbook, you know, be used again. And I think what's shocking to me is that it didn't go smoothly at all at Twitter. Right. It's not as if like Elon got to the end of his Twitter takeover two months in and was like, Wow, that went great, right. He even himself was like, yeah, that was pretty bumpy, Like things are tough. I scared off a bunch of advertisers. You know, maybe maybe didn't handle everything the best way that it could have been handled. And yet here we are employing that same playbook at a national government scale. And you know this, you know, Max, we all know this, Like if Twitter goes down for twenty minutes, we'll be fine. Like not ideal, but we will all be okay. I mean if the US government, I'll be fine. If the US government, you know, payment system goes down or some type of defense system goes down because someone is rushing to do these things. Obviously the impact could be you know, so much more significant and harmful.
I know you have to jump in a minute, but before you do, I just want to ask you one other question, which was this this sort of move to control the actual payouts.
Is there a parallel with Twitter?
Did he actually try did he like randomly cancel contracts? I actually can't remember whether whether it's how closely it tracks.
Yeah, I mean he he basically stopped paying most of Twitter's bills, and he's still in legal fights with a bunch of vendors over unpaid bills. And he also, max, you will remember, didn't pay severance, right, So, even though he's telling a lot of these employees of the US government, hey, you can take this buyout and you'll you know, get paid through. However, many months he told Twitter employees that too, and he's you know, being ensued by thousands of former Twitter employees right now for what they are arguing was insufficient severance. So, you know, a lot of similarities to this idea that he's just going to simply not pay the things that he doesn't want to pay and force people to come and collect that money. Unclear if that's exactly the approach that that he'll take here, but I wouldn't be shocked, right he tends to to welcome a legal fight because he has the resources and the time to drag these things out forever. Whereas a lot of the people who he you know, ultimately stiffs with this stuff, they don't and and they may you know, not find it worth it to fight him in court. So I imagine this will be the beginning of, you know, if I had to predict a lot of legal issues with what's going on here over the these first ten days.
Kurt, thanks for thanks for being here. We'll let you enjoy the rest of your weekend. Dana and Sarah and I will try to break this down. Sarah, I was texting with a source, a former OMB employee who who knows budget stuff pretty well, and sort of asking, how how does this rate from like just normal political wrangling to something much more serious?
Where where do you think?
How significant do you think this is?
I mean, this strikes at the at the very founding ethos of the United States of America, that we have this separation of powers and that the Congress controls the purse.
Right.
This is this is Musk is as an arm of the executive branch, who's not even really he's he's an sge. We can talk about that a little bit more later, but he's not really even a government employee taking control of all of the money that the US government pays out for for salaries, for contracts, for contracts by the way, which which Musks companies receive payments from the US government. So not only is there huge conflicts of interest, but it gets at some of the structural assumptions or at least you know, rules that we have over how the US government works, and the functioning of these systems is critical to global confidence in the dollar, global confidence in the US's ability to pay its bills. It's one thing for Twitter to stiff a landlord. It's another thing for the United States of America to not be good for its money. Right, that is, that is a more serious issue. And to be clear, we haven't seen any evidence yet that Musk has not paid out anything that the US is supposed to pay out. But this is this is power that he's not supposed to have, at least structurally, even if Trump has allowed him to have it. And so yeah, I'm very alarmed by that.
We should say this, this payment system, it's enormous. The New York Times said five trillion dollars in twenty twenty three. It's Social Security checks, it's Medicare, it's it's payments for everything.
So it's not just the risk of default, but like the risk.
That somebody doesn't get their social security, that schools.
Don't get funded, and so on.
The person I was speaking to is saying, essentially, the question is what does he do now? So like, does he just use this data to write some tweets, which would create some concerns potentially because there's private information here, you could imagine him getting stuff wrong.
We've already seen him get stuff wrong.
And then there's a sort of sliding scale to bad where the next step would be unilaterally defunding stuff, which I mean Musk has said that's what he wants to do at times. Trump has said that's what he wants to do. And then and then the furthest along on the scale would be can he actually make payments? You know?
Could he could?
He could he use this system to pay himself or or or somebody else? And and I don't think we know the answer to that question, Dana. Part of what makes this so concerning is, Yeah, this is not just a normal White House official. This is not somebody who's been vetted, who's subject to financial disclosures, who's put all their assets in a trust. It's also somebody who's very very erratic. I mean, like the fact that this is Elon and not some other Trump figure is part of why I would say people are concerned.
Yeah, I mean I think to take a step back, you know, we need to sort of recalibrate the way that we've been thinking about Elon Muskandoge. I think originally a lot of the reporting was like, Oh, it's this like advisory council that he's doing with Vivek Ramaswami. And then it was like, oh, actually Vivek's out, it's just Elon, And then people were still acting like it was just this sort of like advisory board. But no, now it's actually within the government. He's sleeping at the old Executive Office building. And what's happening now and this is what you know, we at Elon Incan elsewhere within Bloomberg would love our listeners support with is like he's got teams of people fanning out to every agency, you know, sort of setting up shop and with Treasury. I think why it is so alarming is that because a career official basically you know, tried to stop them from getting their getting their hands on this data, and it was forced to resign or was forced out earlier this week, and so the Washington Post broke David liverering. Yeah, and so you know, he was forced out, and then we basically announced his retirement on Friday. And then so the sequence events was the Washington Post broke the story, and then you know, everyone was writing about librink resigning. Senator Ron Wyden from Oregon wrote a letter to BESSNT yesterday being like why, like why did you give them access to this? And then we have the New York Times story that's out today, and so it's just we have to like take a step back and constantly remind ourselves. I think how unprecedented it is that the world's richest person, a government contractor who runs six companies and maybe an SGE, although I haven't seen like firm proof of that, is basically waltzing in to every government agency with his associates, demanding access to data that typically has not been given to someone like him and that has always been closely guarded within the agencies itself.
Let me just like put that on another another layer of alarm here, right, Like, in some sense, the people who are frequenting this podcast are not alarmed that this is what Elon is doing. It's exactly what he did at Twitter. We joked on our internal slack when he was given this Doge power like that he would send a fork on the road email. He actually did that. And the difference here is that Elon paid forty four billion for Twitter. It's his company. I mean, he you know, some billions borrowed from banks, but it was his to choose to do what he wanted to do with it. And as much as as people felt like they have some ownership for Twitter because we all we've all used it and had it as part of our Internet ecosystem over the last few years, it's a private company that Musk owns. This is the US government. We own the US government. Taxpayers owned the US government. So when Musk takes down data sets as he's been doing, when he removes you know, and I say Musk, but you know, Doge, the Trump administration extensions of Musk's ideas. When he does that, that's a different story. That's, you know, something that all taxpayers and citizens have to reckon with and could be directly affected by. So I don't want to lose sight of the fact that, like, although this is similar to what he did at Twitter. It's much more extreme and much less authority on his part to even be a person doing this sort of thing with the US government.
You know, it's interesting because everything you're saying is true, but at the same time time, this is kind of what Trump and Musk promised. I mean, you know, there was a lot of there's been a lot of discussion about like, well, it was Project twenty twenty five. Trump sort of ran away from Project twenty twenty five and and said it had.
Nothing to do with him.
But anyone who's paying close attention knew that there would be this effort to sort of take parts of the sort of non partisan civil service and put them under the executive branch. And I think what has changed, like what is different from what maybe some people anticipated, is that we thought it would be like a bunch of heritage guys doing this, and that Elon Musk would be like making a lot of noise, or I would say on this podcast, we actually we were pretty bullish on Elon Musk and Trump's staying together. But there's the sort of conventional wisdom was like Elon's going to be off in this Blue Ribbon Commission and these kind of like extremely conservative elements, or the Trump administration would be trying to do things like this, trying to control more closely payments, even maybe even trying to defund the government. And what's different here is it's Elon Musk, and I think that creates just so much unpredictability and tons of risk. You know, Kurt was saying that how ineffective Musk was at Twitter in the early days, and again, like you're saying, Sarah, like the price of ineffective could be very serious. But of course it does come with kind of this super charged ego energy and just like not caring, like willing to cross lines. I think that maybe other sort of more experienced in government types, people who might have to face a confirmation hearing, wouldn't be willing to cross those lines.
Yeah, Elizabeth Warren just put on a statement it's alarming that Elon Musk has access to government payment systems used to deliver Social Security and Medicare benefits. He also drove out the senior career official at Treasury responsible for preventing a potential default on the US debt.
I'd also love to know to what extent Trump has given permission for a Musk to do this, right, he may have said, like do what you need to do, or like you have my blessing to do what you've done at your companies to get them to the point they're at. I don't know if those in Trump's circle. I can't imagine that they that they knew the specifics of what what it would take to get Musk's vision executed in the way he wants to execute it. I'd love to know more details on who knows what, who's approving what, who's actually in charge.
Yeah, So just as we start to wrap up, I want to just sort of try to spin this forward with you two, Dana, what are you going to be looking at in terms of like in terms of trying to understand like just how unpressed just how much power does Musk have?
How involved is Trump? Like, well, like what are what are what are you.
Looking at in the coming days and what should listeners be paying attention to.
I mean, I think we just need to be wrecking with the with the fact that Musk and Doze are going agency by agency by agency, Right, It's like O M B O, PM, Treasury, the GSA, Education USA. I d like we need to like really sort of get a better grip on like who from DOGE is now landing at each of these agencies, what data are they getting access to and what is what are they actually doing? And how are federal workers resisting?
Yeah, and I'll just jump in with one final thought and then Sarah, I want to I'm going to go to you. But for me, I think the thing to keep in mind here is that unlike Twitter, you know, Sarah kind of laid out what what why, this is potentially a lot more dangerous than if Elon Musk kind of messes with Twitter.
It ruins my joke machine.
But but he could ruin the most powerful you know, the government of the most powerful country of the world or something.
I want to remind people though.
That you know, there's a there are going to be politics here and a lot of this stuff is deeply, deeply unpopular. Cutting off each paint, each time he cuts something off, and if he makes a mistake, it's going to be it's going to create a sense of crisis, and that sense of crisis, it may take a while for voters to pay attention, but there will be a political cost. And saray your point, I think that will start to raise questions about kind of where is Trump Sarah final thoughts for you, kind of what are you going to be looking at over the next couple of days.
I mean, of course, the legal reaction, the congressional reaction, like, how does the government once they realize what has happened, what has occurred, how does the government react? Do they try to stop this? Can they stop this? And if they tried, like, does Musk back down? The other thing? I just want to I just want to be clear about with Twitter, what Musk was saying he was doing things for and what he was doing things for, we're two different things. He said Twitter was all about free speech.
That was his was.
His rallying cry. He made all these changes in the name of free speech. Of course, we have seen that that free speech has not really been supported on Twitter. It's it's just been it's been a version of it. It's been uneven. It's been uneven. Here he's talking about efficiency. What I want to know, what really is Musk's endgame? What is his goal here? When we reflected on the Twitter acquisition and the chaos and what that led to, you know, people were saying, oh, he's losing advertisers, Oh, he's losing he's losing respect. Oh, you know, he's he's ruining his reputation. But it got him close to Trump and it helped him get so close to the US presidency. So ultimately we on this podcast decided that was a good acquisition with the US government. He's saying, this is about efficiency, He's saying, this is about using taxpayer money more wisely, getting rid of the bureaucra See what is he actually doing and what is the goal long term? What is the bigger picture? So I think that's that's really what I'm going to be what I'm gonna be looking for trying to direct reporters to find out about.
Absolutely.
Yeah, it all comes down his companies right there, that there's all these ways that he can profit from this. And we're going to be paying attention both to what's happening in the White House and in the Executive Office building, as well as what's happening in the rest of Musk's empire. Dana Sarah, thanks for joining me. Thanks for making this special podcast on a Saturday night.
We'll see cibios both soon.
Thank you, Thank you guys.
This episode was produced by Mangus Hendrickson. Rayhan Armonci was our senior editor. The Elonink theme is written and performed.
By Taka Yazuzawa and Alex Sagierra.
Brendan Francis Newnham is our executive producer, and Sage Bauman is the head of Bloomberg Podcasts. A big thanks to Joel Weber and Brad's Stone. I'm Max Chafkin. If you have a minute, rate and review our show, it'll help other listeners find us and we will see you on Tuesday.
