When two of US President Donald Trump’s top lieutenants issued a call to remove government spending from the nation’s most-watched gauge of economic growth, they waded into an old and fierce debate that goes far beyond statistics.
Sen. Elizabeth Warren (D-Mass.) on Monday questioned Secretary of Commerce Howard Lutnick over the access tech billionaire Elon Musk’s Department of Government Efficiency (DOGE) has to his competitors and business partners.
Commerce Secretary Howard Lutnick said Sunday that government spending could be separated from gross domestic product reports in response to questions about whether the spending cuts pushed by Elon Musk’s Department of Government Efficiency could possibly cause an economic downturn.
Commerce Secretary Howard Lutnick plans to make an internet infrastructure investment program “technology-neutral,” according to The Wall Street Journal, meaning Elon Musk’s Starlink could more easily benefit.
Howard Lutnick said Sunday that government spending could be separated from gross domestic product reports in response to questions about whether the spending cuts pushed by Elon Musk’s Department of Government Efficiency could possibly cause an economic downturn.
Heterodox economists have long criticized politicians’ maniacal obsession with GDP growth, pointing to its relatively recent creation as a measure of national accounts and its limits as a catch-all indicator of a country’s economic health.
Commerce Secretary Howard Lutnick wants to separate government spending from GDP, which economists worry could lead to cherry-picking data for political gain.
Under new rules from President Trump’s Commerce Department, a $42 billion high-speed internet effort will no longer favor fiber-optic cable.
The Trump administration wants to create a separate report about the economy that strips out the impact of government spending. The Commerce Department already does this.
"Under the BEAD program's original rules, Starlink was expected to get up to $4.1 billion, said people familiar with the matter. With Lutnick's overhaul, Starlink, a unit of Musk's SpaceX, could receive $10 billion to $20 billion, they said," according to the WSJ report.
The agency plans changes that will make Elon Musk’s satellite-internet service eligible for more rural broadband funding.