Elon Musk’s Department of Government Efficiency (DOGE) is advancing a large-scale effort to modernize federal agencies with artificial intelligence, accelerating AI-driven automation within government operations.
But as new projects, such as a generative AI chatbot for the General Services Administration (GSA), push forward, revelations of DOGE-affiliated access to highly sensitive Treasury systems have ignited concerns over oversight, security, and political influence.
At the center of the controversy is Marko Elez, a 25-year-old former SpaceX and X employee who was placed inside the Treasury Department as a special government employee.
According to multiple sources, Elez was granted administrative privileges over two of the most sensitive financial platforms—Payment Automation Manager (PAM) and Secure Payment System (SPS)—which collectively process over $5.45 trillion annually in government payments, including Social Security, tax refunds, and federal payroll.
Initially, Treasury officials denied that Elez had write access. On February 3, Treasury Secretary Scott Bessent informed House Financial Services Committee lawmakers that Musk’s DOGE team had no direct control over financial infrastructure. White House Press Secretary Karoline Leavitt reinforced this position, stating, “DOGE’s access was read-only.”
However, these claims were contradicted by internal records obtained by Wired, which revealed that Elez had full administrative control, allowing him to alter Treasury payment processing code.
The controversy intensified when Talking Points Memo reported that Elez had made “extensive changes to the code base for these critical payment systems.”
According to Treasury insiders, Elez’s access was revoked only after internal pushback, casting further doubt on earlier official statements. This led to additional scrutiny over whether DOGE personnel could manipulate government payments, raising concerns about political influence over financial transactions.
The situation escalated when it was revealed that Musk’s allies requested a halt to USAID payments, a move that coincided with the resignation of David Lebryk, the most senior career official at Treasury.
Sources told CNN that Lebryk resigned after resisting pressure to comply with DOGE’s directives, fueling concerns that Musk’s team had gained outsized influence over government finance.
Lawmakers, particularly Senator Ron Wyden, have since demanded clarity on DOGE’s involvement and whether Musk-affiliated operatives hold unchecked power within federal agencies.
I was just outside the Treasury Department where Elon Musk has launched a full scale authoritarian takeover. My message to Musk is simple: get your hands off our money and get the hell out. https://t.co/eMaIb1fQAk
— Ron Wyden (@RonWyden) February 4, 2025
GSA’s AI Chatbot Raises Questions About Government AI Strategy
Beyond the Treasury controversy, DOGE is advancing AI projects aimed at restructuring agency operations. One of the most ambitious is GSAi, a generative AI chatbot designed to centralize and automate federal procurement and contract management.
The project is part of President Donald Trump’s “AI First Agenda,” which aims to modernize the federal government through advanced technology.
The primary objectives of GSAi are:
- To improve the daily work efficiency of approximately 12,000 GSA employees.
- To analyze vast amounts of contract and procurement data.
- To streamline workflows and automate routine tasks within the GSA.
- To provide data-driven insights for better decision-making.
The chatbot is being developed in-house rather than using existing solutions like Google’s Gemini AI.
The Technology Transformation Services (TTS) division within GSA has worked on AI-driven procurement analysis for some time, but DOGE’s involvement has significantly accelerated the timeline and shifted the project’s focus.
Thomas Shedd, a former Tesla executive now leading the GSA’s Technology Transformation Services, is involved in the project.
During an internal meeting, Thomas Shedd referenced the initiative, stating, “The thing that’s different is potentially building that whole system in-house and building it very quickly.” The goal is to analyze procurement data at scale to improve spending efficiency across federal agencies.
However, watchdog groups and AI policy experts have raised concerns over bias in AI-driven procurement analysis, security risks, and the potential for AI to misinterpret complex contract data.
While AI automation has been widely adopted in the private sector, applying similar models to government spending introduces new oversight challenges. Critics warn that unchecked AI systems could introduce inefficiencies, fail to account for legal complexities, or even reinforce biases in contract selection.
These concerns are magnified by the Trump administration’s AI-first governance strategy, which actively seeks to remove regulatory barriers to AI adoption in federal agencies.
This shift contrasts sharply with the Biden administration’s more cautious approach, which had previously directed agencies to evaluate risks before deploying AI models in mission-critical tasks. Under Trump, agencies are being pushed to rapidly integrate AI solutions, positioning DOGE at the center of the government’s AI modernization efforts.
Trump Orders Federal Agencies to Cut Media Subscriptions
As DOGE advances its AI-driven restructuring of federal agencies, the White House has also moved to eliminate government spending on news media. President Trump ordered the General Services Administration (GSA) to cancel all media subscriptions, targeting Politico, Bloomberg, and the BBC.
NASA leadership has verified that this was cancelled today. https://t.co/wSqWOFtHeT
— Department of Government Efficiency (@DOGE) February 5, 2025
The decision follows growing pressure from Musk’s allies, who amplified claims on X that millions of taxpayer dollars were being used to “fund” anti-Trump media outlets. These allegations misrepresented the role of government media subscriptions, which are primarily used by agencies for policy tracking and industry research.
Treasury leadership verified that their NYT contracts were cancelled today. https://t.co/cd3STUgrzF
— Department of Government Efficiency (@DOGE) February 6, 2025
White House Press Secretary Karoline Leavitt defended the move, stating, “The more than eight million taxpayer dollars that have gone to essentially subsidizing subscriptions to Politico on the American taxpayer’s dime will no longer be happening.” Critics, however, argue that the measure is politically motivated, targeting outlets that have published critical coverage of Trump and Musk.
In response, Politico CEO Goli Sheikholeslami and Editor-in-Chief John Harris addressed the accusations directly, stating, “POLITICO is a privately owned company. We have never received any government funding—no subsidies, no grants, no handouts. Not one dime, ever, in 18 years.” They clarified that Politico Pro, a premium policy news service, was procured by government agencies in the same manner as any other commercial research tool.
“Government agencies that subscribe do so through standard public procurement processes — just like any other tool they buy to work smarter and be more efficient. This is not funding. It is a transaction — just as the government buys research, equipment, software and industry reports. Some online voices are deliberately spreading falsehoods. Let’s be clear: POLITICO has no financial dependence on the government and no hidden agenda. We cover politics and policy — that’s our job.”
The GSA directive reflects a broader trend under the Trump administration to reduce federal spending on external services, aligning with DOGE’s cost-cutting mandate. However, concerns remain that the decision erodes government access to high-quality policy intelligence, potentially impacting the ability of agencies to stay informed on legislative and economic developments.
Musk’s Expanding Role in Federal AI Policy
Beyond DOGE’s immediate projects, Musk’s influence over federal AI policy is growing. The recent controversy over Treasury access, GSA automation, and media restrictions ties into a larger battle over AI governance in Washington. A major factor in this debate is the Stargate Project, a $500 billion AI infrastructure initiative backed by OpenAI, SoftBank, and Oracle.
The project aims to build massive AI computing facilities across the U.S., positioning the country as a global AI leader. However, Musk has publicly criticized SoftBank’s financial position, claiming on X that the company has “well under $10 billion secured” to support its commitments. His skepticism reflects a larger power struggle within the AI industry, as different factions compete for influence over federal AI infrastructure funding.
Musk’s criticisms of OpenAI extend beyond Stargate. His relationship with OpenAI CEO Sam Altman has been increasingly tense, particularly as OpenAI seeks infrastructure independence from its long-time partner Microsoft. Microsoft’s $14 billion investment in OpenAI was once a defining partnership, but Stargate introduces a new dynamic that could shift control over AI development.
At the same time, Musk’s own AI venture, xAI, is scaling rapidly, emerging as a direct competitor to OpenAI. His company is investing heavily in compute infrastructure, including the massive expansion of its Colossus supercomputer, which is being positioned as an alternative to Microsoft and OpenAI’s cloud-based AI platforms. This competition could further influence federal AI adoption, as different technology providers seek to supply computational power for government AI projects.
Implications for AI Regulation and Government Oversight
While DOGE’s AI-first strategy is reshaping federal operations, the lack of clear regulatory oversight remains a key concern. The Treasury scandal has raised urgent questions about who controls AI deployment within government systems and whether the expansion of AI-driven automation is outpacing legal and ethical safeguards.
Lawmakers have already begun demanding investigations into DOGE’s role in Treasury operations, with particular scrutiny on how Elez was granted administrative access. Meanwhile, AI policy experts warn that rapid AI deployment in government without clear oversight mechanisms could lead to unintended consequences, from financial mismanagement to biased procurement decisions.
The broader implications extend beyond DOGE. As AI becomes a core part of U.S. governance, debates over transparency, accountability, and security will shape future legislation. The events unfolding in Washington serve as a preview of the challenges ahead to ensure democratic oversight over AI-powered decision-making.
