A 'Penny Wise, Pound Foolish' Attack on the Nation's Future
Trump's Project 2025 manpower and agency cuts will let him extend his tax benefits for the wealthy. But the long-term effects on our nation and the states, not to mention you and me, are bleak.
On Sunday night, Donald Trump ordered the Treasury secretary to stop producing new pennies, a move he said would help reduce unnecessary government spending.
He isn’t wrong, but it highlights a central problem of the Trump administration: While this action may, indeed, be penny wise, it’s just one tiny, tiny aspect of a massive “penny wise, pound foolish” effort that carries the potential to damage the U.S. over time at many levels and in many different ways.
Let’s give him credit for the penny push, which will save about $185 million (couch change for a government with a $6.7 trillion budget). Meanwhile, the mammoth manpower cuts and the elimination of whole agencies by the new administration could end up boosting state taxes, shrinking services for our health and our schools, limit the response to natural disasters, end protections against corporate greed and, finally, diminish our nation’s standing in the world.
That’s the second half of the “penny wise, pound foolish” idiom. While Trump will get his hugely expensive tax cuts for the wealthy approved, and perhaps kick in a few minor nods in the tax code for the rest of us, there is little discussion about the aftereffects of all these government cuts on everyday folks.
So, let’s take a moment and think this through:
— Decreasing the federal workforce by up to 75%, an Elon Musk goal, could drive up unemployment, weaken consumer spending, cut sales tax revenue, strain state and local economies, raising the costs of public assistance for the jobless. Meanwhile, who will answer the phone when you have issues you need addressed? Certainly not Elon Musk.
— Reducing Medicaid funding and Affordable Care Act subsidies could leave millions uninsured or weakly insured, boosting uncompensated costs for hospitals and, eventually, everyone’s health costs to cover their care. And once again, this could raise the burden on states to compensate, though some states — the ones ruled by MAGA — might simply ignore whole segments of their population as a result.
— Disbanding agencies like the Consumer Financial Protection Bureau (CFPB) and the Federal Deposit Insurance Corporation (FDIC) will undoubtably lead to financial misconduct and instability. In January, for instance, the CFPB sued Capitol One for failing to pay more than $2 billion in interest to customers after advertising a high-yield checking account that paid an interest rate close to zero.
Since its inception in 2009 under Barack Obama after the housing crisis, the CFPB has compensated consumers to the tune of $21 billion monetarily, through loan principal reductions, canceled debt and more. We’re talking about the creation of new “Gilded Age” here, folks, much like the one in the late 19th century when a few individuals accrued immense wealth and used their wealth to manipulate the political system to their own benefit. Does this sound familiar?
— Sparking trade wars with our allies and other countries will increase the prices Americans pay for everyday goods, and could curb our ability to market our own products internationally. Prior to the 2018 tariffs against China, for instance, that country accounted for 25% of Boeing’s sales. After the tariffs, China stopped ordering Boeing aircraft, creating an opening for China’s homegrown COMAC C919, a competitor to Boeing’s 737.
— And when tariffs are twinned with Trump’s decision to eliminate global humanitarian efforts, it could well allow China and Russia to step in and strengthen their influence worldwide.
— Shuttering the Federal Emergency Management Agency (FEMA),whose budget is set by Congress, will leave state officials open to political coercion in order to win grants they need to recover from disasters. Trump has already said California must approve assorted political-based, ideological conditions to gain federal aid following the January wildfires that hit the Los Angeles area, killing 29, destroying 16,000 buildings and rolling up an estimated $50 billion in losses.
If FEMA is gone, it may not matter how many Americans are hurting. What will matter is whether the political personality of the area hit lines up with the politics of the party in power in Washington. And who knows how long it will take for aid to be provided in any case.
— Eradicating the Education Department and depending on the states to handle their responsibilities will, again, likely raise state and local taxes. And depending on the state, it could translate into fewer resources for kids, particularly in poorer districts. The department provides $15 billion for roughly 7.5 million students with disabilities, and investigates racial, gender and disability discrimination. And who will oversee Pell Grants, relied on by 30% of college students?
I wrote about the cuts to University Biomed research on Sunday, noting that every $100 million of funding in this area generates 76 patents, which produce 20% more economic value than other U.S. patents and creates opportunities for about $600 million in future research and development. Besides that, and perhaps more importantly, they’re a mainstay push against a wide range of diseases, including cancer, diabetes, sickle-cell anemia and others.
That particular cut has now been blocked by a district judge who likely understands their penny-wise, pound-foolish basis. We’ll see how it plays out.
So far, reaction to all this has been relatively muted, limited to the courts, relatively small protests in Washington and a growing undercurrent online. But the key will be how the nation responds to the 2026 mid-terms, which offers everyday citizens the first real chance to bring the dangerous Donald Trump-Project 2025-Elon Musk triad to leash.
But there’s a problem. The possible overall, long-term effects of Trump’s penny-wise, pound-foolish fusillade has yet to be debated in a true public forum, and may never be. Much of the middle class, which makes up half of America, has largely tuned out MAGA's culture war, holding both the far-left and the far-right in equal contempt.
While many middle-class Americans now tsk-tsk or even ridicule Trump’s actions at the dinner table (make Canada into a state? Ban paper straws? The Gulf of America?), and complain among themselves, they’re clearly not yet outright committed to change.
That may take them actually being hurt and, by that time, many of these changes could be irreversible, depending on how the demonstratively far-right U.S. Supreme Court weighs in. We certainly face some sad times ahead. What do you think?
This paragraph really gets to the heart of it: “Let’s give him credit for the penny push, which will save about $185 million (couch change for a government with a $6.7 trillion budget). Meanwhile, the mammoth manpower cuts and the elimination of whole agencies by the new administration could end up boosting state taxes, shrinking services for our health and our schools, limit the response to natural disasters, end protections against corporate greed and, finally, diminish our nation’s standing in the world.” Well said.