Elon apparently attended a Cabinet meeting in which he laid out that the US will go bankrupt without prompt action.

He's right, but also wrong

The Federal Government can't go "bankrupt" like you or I (or any other private firm) can.  That is, it can always issue bonds at some price; that is what TBAC and Primary Dealers promise in exchange for first access to Treasury auctions.

Problem: The banks who apply to be primary dealers do commit to bid -- but they do not commit to do so at any particular given price.

This means that while the US Government can't "go bankrupt" like you or I it can certainly face a "death spiral" in the Treasury Market and if suppressed, as it was with "QE" in the past, nothing can be done about the inability of ordinary people to pay, at which point it becomes "rob something, kill someone (and either eat them and/or take their stuff) or starve to death."

That can happen.

Musk believes (and apparently Trump believes him as well) he can "find" $1 trillion a year in fraud and abuse in government spending.  For context that's sixteen percent of the roughly $6 trillion a year the government spends.  May I remind you that the government spent $4 trillion a year just before Covid, and Covid is no longer a public health threat, but the spending was never returned to the previous levels.  This is where the current $2 trillion a year deficit comes in and Congress, right now, is prepared to pass a budget resolution via reconciliation that rescinds exactly zero of that additional $2 trillion in spending.

If you think 16% is completely unreasonable may I remind you that about 10 years ago the Senate budget committee found eight percent of all federal spending was against expired programs, which means every penny of that was illegally spent (that is, it was fraud against the United States.)  So could DOGE find not just that, none of which has apparently been stopped, but double that much?  Perhaps.

But even if they do and stop every dollar of that its not enough to change the trajectory.

The only way you can address the budget problem on a realistic basis is to take a meat axe to health care spending.  That requires not going after Medicare and Medicaid but rather going after health care cost generally, from doctors to hospitals to pharmaceutical companies.  All of them are engaged in criminal acts under 15 USC Chapter 1 and that law has been ruled to apply twice at the Supreme Court in the late 1970s and early 80s in two separate decisions.

It thus requires no law to be passed and in fact Congress cannot stop enforcement because they passed the law in question more than 100 years ago.  But in addition to stomping on all the fraud in government spending the entire medical system must be forced to conform to said law, and if they are costs will drop like a stone -- by as much as 80%.  Yes, that also means there will be mass unemployment from that sector but doing will wildly improve the economics for every other line of business and thus those people can go find actual productive work to do instead of extorting Americans and spreading it around clucking at how "wonderful" the local hospital is when said hospital killed nine out of ten who went in there with Covid just a few years ago.

I put forward a proposal to do precisely that originally in Leverage and then refined it in this article (with an implementation follow-up article) here.  Note the date.  Note also that Trump's "Executive Orders" referring to "transparency in pricing" do nothing to address the blatantly felonious pricing based on how you pay (e.g. what "insurance" you have) which was already ruled not exempt from anti-trust under McCarran-Ferguson as that was found to not be part of "the business of insurance" by the Supreme Court.

In addition to that every single person renting to or employing an illegal must go to prison under 8 USC 1324 as the law, on the books since the 1950s, demands -- and this includes any state or local official to harbors or assists an illegal immigrant.  State officials are not immune from Federal law; they never have been and are not today.  No more ******ned excuses.  There is no more time for this crap and costs -- that is, prices -- must be collapsed on an immediate basis in order to bring the economy back into balance, never mind that expelling all of those people will raise the wage base materially.  Enforcing said law collapses demand for housing (therefore prices will fall like a stone) and in addition so will the cost of car insurance because all those illegals do not have a driver license, insurance or any money to pay and those claims have largely driven insurance cost never mind collapsing the demand for cars and thus those prices too since they won't be buying them, will they?  If there is no way to rent housing, no way to buy housing and no place an illegal can be employed they will all leave on their own within weeks to months.  With the labor pool shrinking wages will rise which makes it good twice for the common American: You will make more and spend less on necessities!

We cannot "grow" out of this hole.  Only half the population, roughly, per the BLS works.  Half the remainder, roughly, live off assets (including anyone drawing Social Security) and the other quarter of the whole produce nothing and rely on the other two.  You would thus have to manage to increase incomes at twice the rate of productivity and GDP output to balance the equation without the working person going bankrupt and starving which would in turn lead to even more inflation.  It simply does not pencil out no matter what line of crap someone tries to run and never has because it can't.

This "growing out of the hole" BS was claimed in the 1980s but that's not what we did and those who claim that are knowingly lying.  In the 70s and 1980s we ejected women from the home raising kids and sent them to work; that was "how" we "grew" out of the hole from the 1970s inflation.  In short we didn't grow out of anything at all; we took somewhere close to half the adult population that was not working for a wage and forced most of them out of child-raising as their primary role into working for a wage.

There is no additional group available to force into the workforce this time around and in fact we must reverse that former line of crap because child care has to be provided by someone and the best and most-qualified person to do so is one of the parents.

Thus the only option is to collapse the cost of living.  That means serious deflation in asset and service prices.  Chief and others say "well but you can be a mechanic for $50/hour!" and that's true but if a car is $100,000 and a house is $500,000 you still can't afford to buy one of each, plus the insurance on both, plus health care plus the skyrocketed cost of energy to heat and cool that house because our government has roughly doubled that along with vehicle fuel via their inflationary policies (never mind the false so-called "climate emergency.")  Every bit of these claimed "ways" to make it all work out were god-damnable lies.

All of this has to have the rug pulled out from under it and it has to happen now.

There is simply no more time and we cannot afford any more compounding of the damage.

Yes, destroying all the fraud and subterfuge is a big part of the answer but it is not sufficient and without the rest it fails anyway.  In addition the required adjustment is much larger than it first appears because when you yank the rug out from under all of this GDP will of course go down and thus so will tax receipts so the actual required adjustment must also take that into account.

Claims that this is "impossible" are false but it will be disruptive -- very much so and there is no avoiding that.  But we can apply immediate wage and environmental parity tariffs (as I called for in Leverage) to make the current offshoring that has been done uneconomic and thus effectively force those jobs back here into America -- and that, indeed, will help quite a bit.

If you think this is unreasonable to demand and enforce via whatever means may be necessary then explain exactly how far the common American should allow rampant felony behavior by fully 20% of the economy (in health care) and in regards to somewhere north of 10 million illegal immigrants with regard to their landlords and employers to go?  It has already more than doubled the price of housing in real terms, multiplied the cost of health care by five and doubled the cost of property and casualty insurance over the last few years -- and in some cases such as homeowners insurance in places like Florida and California more than doubled it.  Exactly why should the common American be "law abiding" with regard to politician and businessperson who are either committing felonies themselves or sitting on their ass and refusing to prosecute said felonies yet funding the cops and prosecutors who are supposed to be bringing those charges and clucking while spending even more money we don't have while the common citizen is robbed blind to the tune of trillions every single year?

At what point does an amount stolen cross the line into a capital offense by everyone involved in said theft and how can you rationally argue we didn't reach that point two decades ago?

Trump says he's going to fix it.  Do recall he issued an Executive Order during his last term on health care pricing and the hospitals gave him the finger either with convoluted bull**** or by literally ignoring him.  In response he did nothing.  Now he's going to scold them with a NEW E/O?  Since their conduct is and has been illegal under laws that have stood for 100 years and were confirmed to apply by the Supreme Court why doesn't he order his much-vaunted FBI and AG folks to go apply some silver bracelets, issue criminal indictments, drag the executives out of their offices by their hair and prosecute all of them?  10 years in the slammer imposed upon the first few will result in immediate compliance and level pricing for all who seek medical goods and services by the rest -- or the rest will join their buddies in prison and be asset-stripped under that same law to their underwear.

Ditto for cities housing illegals and private landlords renting to them; Laken Riley's killer was in a rental apartment and under 8 USC 1324 the landlord is liable for life in prison because he harbored said alien and the alien killed an American.  Arrest and prosecute everyone with an ownership interest in that apartment building right damn now along with every employer who has illegals in their employ including all the meatpacking plants, builders, roofers and other concerns.  There are rumors that a car plant in Georgia was raided and many illegals ran off so why weren't the plant executives immediately arrested?  I've had enough of this **** and all of it are felony offenses.

No more ******ned excuses or "waiting for the plan"; we must demand that Trump's Administration, which now has both a functional DOJ and FBI head, do it now.  TODAY.  Not tomorrow, not next week, right NOW and across the board.

Eight years ago we had the opportunity to resolve this with less pain and in 2008 we could have taken our medicine as well.  It was even less painful before that in the aftermath of 2000 and I was raising Hell about where this was going back into the 1990s when I ran MCSNet as it was obvious even back then where this was all headed.  But all these times we chose not to as a body politic and each time we emitted more credit into the system for the specific purpose of avoiding that reconciliation we made the problem worse and the resulting correction in assets and the size of government wildly expanded.

This time we simply cannot do it again as there is nobody left to screw that has marginal value remaining we can take from them.