By Tami Luhby, CNN

(CNN) — Elon Musk has walked back his previous claim that he could cut at least $2 trillion from the federal budget, saying Wednesday that half that amount would be “an epic outcome.”

Musk, who has been tasked by President-elect Donald Trump to co-lead the so-called Department of Government Efficiency, or DOGE, called the $2 trillion target “the best-case outcome.”

“If we try for $2 trillion, we’ve got a good shot at getting one,” Musk said in an interview streamed Wednesday evening on X, which he owns. “And if we can drop the budget deficit from $2 trillion to $1 trillion and kind of free up the economy to have additional growth — such that the output of goods and services keeps pace with the increase in the money supply — then there will be no inflation. So that, I think, would be an epic outcome.”

There’s no shortage of money-saving targets in the federal government, Musk said, without offering any specifics.

“It’s very, very hard for people to care about spending someone else’s money,” he said.
“Actually, I know people in the government who do care about, just as a matter of principle, spending money effectively. And they try to do so, and they can’t. The system prevents them from doing so.”

Musk, the world’s richest person, is looking to downsize the federal budget and operations by slashing spending, curbing regulations and cutting the workforce. However, budget experts have scoffed at his pronouncements, saying that eliminating $2 trillion from a roughly $6.8 trillion budget is unrealistic.

DOGE, which is co-led by entrepreneur Vivek Ramaswamy, does not have any direct power to make spending cuts, regulatory changes or other moves —– though Musk’s comments carry weight with lawmakers, as was evident last month when he helped torpedo a bipartisan spending deal after railing against it. Despite its name, the effort exists outside of the government and will likely serve to make recommendations to the White House.

Still, many congressional Republicans, as well as some Democratic lawmakers, have embraced DOGE’s mission to streamline the federal government.

Asked by CNN’s Kasie Hunt about the size of a budget cut he thinks is realistic, Iowa Rep. Zach Nunn, a Republican, said Thursday he wants to see a “cutback on just the vast overreach we see coming out of Washington, DC.”

Slashing red tape

In the wide-ranging interview with Stagwell CEO Mark Penn, who served as a senior adviser to former President Bill Clinton, Musk also reiterated his complaints about federal regulations.

“Essentially we’ve had an accumulation of laws and regulations that make basically any large project essentially illegal,” said Musk, who has noted that federal regulations have interfered with his business ventures. “And even if you try to do it, you’re going to spend way more money on the paperwork than on the thing itself. So, and then it gets delayed. So there’s an element of DOGE which is very important, which is looking at regulations and getting rid of ones where the harm is worse than the good.”

CNN’s David Wright and Shania Shelton contributed to this report.

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