Musk’s Drastic Move Shuts Down USAID, Echoing His Twitter Layoff Strategy

Elon Musk leads the closure of America’s largest foreign aid agency amid controversy / AFP

Elon Musk, CEO of Tesla, SpaceX, and X (formerly Twitter), is now spearheading the closure of the United States Agency for International Development (USAID). The unexpected shutdown, described as unprecedented in scale and approach, saw employees receive an email instructing them not to come to work just hours before the Washington, D.C. headquarters was sealed off with “No Unauthorized Access” signs and yellow tape.

USAID, established in 1961 to counter Soviet influence and promote American soft power, has been the country’s largest foreign aid organization, with a budget of approximately $40 billion supporting 130 countries as of 2023. The agency even played a role in South Korea’s development during the 1970s, funding projects such as the “AID Loan Apartments.”

Despite concerns that the closure could create a power vacuum for China and Russia to expand their influence, former President Donald Trump signed an executive order on January 20 to freeze all U.S. foreign development aid for 90 days, citing widespread “fraud, dishonesty, and waste” in foreign aid programs.

The driving force behind the shutdown is Elon Musk, now head of the controversial "Department of Government Efficiency" (DOGE). Musk has publicly criticized USAID, referring to it as a “nest of radical left Marxists” and a “criminal organization” on his social media platform X. He claimed that Trump personally approved the agency’s closure.

DOGE, an unofficial advisory body established by Trump's executive order, operates without formal oversight and is slated to disband on July 4, 2026. Despite having no dedicated website or clear budget disclosures, DOGE reportedly deploys teams of leaders, engineers, human resources experts, and legal professionals across federal agencies to identify and implement cost-saving measures.

Musk’s handling of USAID has drawn comparisons to his approach during Twitter’s restructuring after its acquisition. The New York Times noted that tactics such as sending resignation recommendation emails, publicly criticizing employees, and downsizing office spaces were eerily similar to Twitter’s layoffs. Several of Musk’s trusted allies from that period are reportedly leading the restructuring efforts at USAID.

In recent weeks, DOGE has aggressively cut government spending, halting various federal subsidies and claiming over $1 billion in savings by canceling contracts related to Diversity, Equity, and Inclusion (DEI) initiatives. This aligns with Trump's executive order dismantling DEI policies across federal departments.

The abrupt nature of these cuts has led to severe consequences. The National Science Foundation (NSF) suspended all research funding to investigate DEI project expenditures, causing many university researchers to lose vital government support. Complaints have surfaced on social media as academics face financial hardships due to the funding freeze.

In another bold move, DOGE reportedly secured access to the Treasury Department’s payment system, which oversees $5 trillion in federal expenditures annually. Musk highlighted that Treasury officials had “never rejected a single payment” before DOGE’s involvement, emphasizing the need for stricter budget oversight.

There are also rumors that Musk is exploring blockchain technology as a tool to track federal spending and reduce government operating costs.

However, the rapid expansion of DOGE's influence has sparked legal and public backlash. Citizens' groups have accused the organization of violating the Federal Advisory Committee Act (FACA) by conducting opaque budget decisions without proper oversight. Critics argue that the unofficial body’s access to sensitive financial data poses risks, including the possibility of Musk advancing personal economic interests.

Despite mounting concerns, Musk and DOGE remain resolute in their mission to reform federal spending. Whether this controversial experiment in government efficiency will succeed or cause further chaos remains to be seen.