A federal judge in Washington, DC refused that Elon Musk’s Government Efficiency (DOGE) would block access to U.S. Labor Bureau data. The ruling came on Saturday after the Federation of Industrial Organizations (AFL-CIO) of the Union of Trade Unions (AFL-CIO) filed a lawsuit against Elon.
AFL-CIO, in court filings, access to Elon’s work data could lead to conflicts of interest by providing internal information about his company’s investigations (Tesla, SpaceX, X, and boring companies). He said it was sexual. Judge John Bates reviewed the case and said he was concerned about Elon’s actions, but ruled that the AFL-CIO could not prove that the harm had occurred.
Bates’ decision is a temporary victory over Elon and his cost-cutting mission, a blow to the unions. During a press conference released after the verdict, AFL-CIO President Liz Schler called the ruling “not a defeat, not a defeat,” and gave more evidence to “save America from America.” He added that he plans to raise it.
Critics scrambled Elon’s Doge
According to court documents, the AFL-CIO alleges that Elon’s team is seeking confidential information about government officials, including those involved in labor complaints and those involved in safety investigations. The union believes this could expose whistleblowers and give Elon an unfair advantage over its competitors being investigated by agencies such as the Occupational Safety and Health Agency (OSHA).
Another major concern is that potential access to Elon’s Bureau of Labor Statistics (BLS) reports indicates the state of the economy. These reports are highly sensitive and can affect both policy and business strategies. Critics say Elon may manipulate such information for personal gain, but the White House says that Elon rejects himself from issues that he has economic conflict. It’s claiming.
But Elon is not exactly bound by the rules of typical federal employees. As a “special government employee,” he dodges many ethics and regulations of conflicts of interest. This loophole is one of the reasons the union is suing, saying that Elon’s position gives him “unidentified power” against the federal workforce of America’s 2.2 million members. .
Meanwhile, in another legal battle, a separate coalition of federal employees unions and a Democratic state attorney general is suing the Treasury department to block access to Elon’s payment records. The case escalated when New York Judge Paul Engelmeyer issued an order temporarily blocking Doge from Treasury data.
Engelmayer warned that giving Elon and his allies access to payment systems would pose a significant risk of data breach.
His ruling, issued Saturday morning, ordered all special government officials and political appointees outside the Treasury Department to destroy any information they may have accessed since Trump took office. The finance authorities have agreed not to hand over more data until a court hearing is scheduled for February 14th.
Unions, lawmakers and states oppose Doge
New York Attorney General Leticia James is one of the loudest voices against Elon’s operation. “We sued Donald Trump of the free reins and gave Elon Musk and Doge to access American personal information,” she said in an official statement. James accused Elon of weaponizing government data to justify reducing key services such as education and healthcare. “This is unacceptable and illegal,” she added.
Elon fought back against the Democrats and accused them of “ironically undemocratic tactics.” He pointed to past controversy, saying, “They stopped Bernie being a candidate, unfairly abandoned the RFK and switched Kamala for Biden without primary! Now they ruthlessly attacked Doge. It’s just trying to stop taxpayer dollar fraud, waste and abuse!”
The next Treasury hearing is scheduled for February 14th. Until then, Elon’s team remains temporarily locked out of the financial system, but still retains access to data in the labor sector.
Liquidity crunch hits as Fed RRP facilities emit $2.5 trillion
As this is all going on, the Fed’s Reverse Repo Facility (RRP) is dry and causes another headache for Elon. RRP, which helps manage liquidity in the financial system, lost an all-time high of $2.5 trillion in December 2022, reaching its lowest level in 1,386 days.
Here’s how it works: The Fed is temporarily selling Treasury securities to financial institutions, contracting to buy them back at a higher price later. But now, as the US government is flooding the bond market to fund its deficit, RRP liquidity is rapidly drying, according to the latest Fed data.
Over the past 18 months, liquidity from the RRP and the US Treasury has outpaced the Fed’s balance sheet cuts by $417 billion. This means that the bond market is saturated with supply, and the Fed does not need to inject excessive liquidity to keep things balanced, but still, it is a key tool to stabilize the market. I’m losing one.
Deficit spending is a central issue. The US holds $36.2 trillion in debt, of which $9.2 trillion will mature in 2025 or will need to be refinanced. This is 25.4% of total debt, a major burden on the bond market. President Trump has launched Doge to control the situation with the task of reducing government spending by $1 billion a day.
If successful, this will save $365 billion by January 2026 and reduce the deficit by 20% in the first year. But going with current numbers, we need to cut $5 billion a day to completely eliminate the deficit.
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