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Posted on 02/25/2026 12:27:22 PM PST by Miami Rebel
Many Americans were skeptical of Elon Musk’s grandiose claims that DOGE would take a “chainsaw” to federal spending. One “tax nerd” was so skeptical he decided to “bet his life savings” on Musk’s promises being a flop — and it paid off big time, according to a report by The Wall Street Journal.
Musk has seen his approval rating descend as he has taken a more publicly active role politically, plus ongoing criticism and litigation over his management of his social media platform X and support for far-right politics in Europe.
He jumped into his work with the Department of Government Efficiency, or DOGE, by waving around a chainsaw on the stage at CPAC in 2025 and then presided over a group of DOGE employees with little to no government experience who fired scores of federal workers, slashed budgets, and eliminated longstanding grants and programs. However, contrary to his promise to save $1 trillion, federal government spending actually went up.
It all seems somewhat predictable in retrospect, but would you have been willing to bet your life savings last year that this would, in fact, happen?
Alan Cole, senior economist at the Tax Foundation, took that bet, telling WSJ reporter Richard Rubin how and why he dropped $342,195.63 into a prediction-market wager on the Kalshi platform.
(Note: the WSJ called this amount Cole’s “life savings” and then later defined it as “effectively everything outside of his retirement accounts and home equity.”)
Describing himself as a a “normal, conventional Wall Street Journal-reading adult” — the WSJ identified him as a “tax nerd” in their headline — Cole said that he looked at the terms of the Kalshi wager and saw an opportunity, because he did not believe anything Musk would do would significantly curtail spending on interest on the national debt or entitlements like Social Security and Medicare, especially as America’s population continued to age.
The bet on the Kalshi site was simply that federal spending would go up, as it long has, and Cole interpreted the risk as lower than a standard sports bet or other prediction-market bets that can be gamed by people with insider knowledge (e.g., how long will President Donald Trump’s State of the Union speech be, whether Lady Gaga would join Bad Bunny’s Super Bowl performance, etc.).
Cole did diversify his risk somewhat, he told the WSJ, making multiple sub-bets so he would at least break even unless spending declined by more than $50 million.
When the federal government released its official 2025 spending figures on Feb. 20, it “wasn’t even close,” wrote Rubin. “The lowest spending quarter in 2025 was $66 billion above the bet’s target level,” netting Cole “$470,300, for a profit of more than $128,000, or 37%.”
Cole still has to pay capital gains taxes on the funds he withdrew from investments and taxes on his winnings.
His wife, Natalie Lynch, told the WSJ she got on board after understanding that the bet would be based on specific objective numbers. “She read comments on the Kalshi website from people on the other side of the bet and grew confident because they didn’t seem to understand what they were buying,” wrote Rubin.
The WSJ report noted that Cole sought advice from other fiscal policy wonks, including Brookings Institution fellow Jessica Riedl, who said the outcome of the bet “should have been completely obvious to anyone who knows anything about the government, the budget and public administration.”
Despite believing Cole would win, Riedl still didn’t make her own bet, saying she was ” nervous about liquidity, administrative loopholes, legality, making sure that I got paid.”
Riedl apparently was under the impression Cole had only bet a “few thousand dollars,” but after Rubin told her Cole had made a six-figure wager, she had a quick retort.
“Next time I have lunch with him,” she said, “I know Alan will be picking up the check.”
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If DOGE failed, then where are the dividend checks going to come from?
We have fewer government employees now than in years. So it depends on the metric used.
DOGE did not fail. It was tearing the hell out of things. But then Patel, Bessent, Blondi, Wiles, etc turned on it with a vengeance. They got Trump’s ear and Bessent even had a gay rage incident and punched Elon to keep him out of the treasury dept.
Johnson and Congress utterly refused to cover his efforts with legislation and to codify what he found.
The DC swamp swarmed like white blood cells to an infection in self defense... and Elon was kicked to the curb. The administration moved DOGE into the Cyber security office to kill it and pretend it’s still a thing. But it’s a nothing but a skin suit.
DOGE was fine; DC, Trump and the Repub leadership failed.
Little Marco also resisted it, and told people at state to avoid the accountability audit emails.
All of the GOP turned on Musk with a vengeance.
The bet was on DOGE failing to achieve its objectives, not that Musk would fail personally.
You beat me to it.
Currency debasement and devaluation is a runaway train. It's the nature of our printed, fiat currency and monetary system, which enables massive debt, massive spending on woke government, cronyism and welfare.
The train stops only when we run out of track
Thank you for describing how it failed.
Cole wagered over $342,000 — and walked away
with $470,300 for a handsome $128,000 profit.
DOGE had no statutory authority on it own. All it could do was make recommendations to Congress and agencies. Some were followed, some weren’t, many required legislation. Legislation has been problematic.
axios.com
snip
The intrigue: The latest trouble between Musk and Bessent began brewing on April 16, when Trump named Gary Shapley — Musk’s choice — as acting commissioner of the IRS. Bessent wanted Deputy Treasury Secretary Michael Faulkender in the position.
Bessent lobbied Trump to install Faulkender and fumed that Musk was causing trouble by going behind his back. On Thursday, at a meeting in the White House, Bessent confronted Musk and, a source said, “the F bombs started to fly.”
Bessent criticized Musk for overpromising and under-delivering budget cuts with DOGE. Musk clapped back by calling Bessent a “Soros agent” and accusing him of having run “a failed hedge fund.” (Trump has praised Bessent’s financial acumen.)
The argument was so heated that an aide stepped in between the two men to separate them. It took place within earshot of Italian Prime Minister Giorgia Meloni, who was visiting Trump that day.
Two sources who overheard the argument recalled that at one point Bessent yelled,” F**k you,” and Musk replied, “Say it louder.”
That night, Trump loyalist Laura Loomer got in on the action and began torching Bessent on X for allowing an unrelated “Trump hater” into Treasury for a financial literacy event.
“Troubling,” Musk said in a quote-post reply at 11:02 p.m.
But on Friday, Bessent had the last word when the Times reported that Shapley was out and Faulkender was in.
What’s next: There’s little appetite by Musk or Bessent for a rapprochement, and White House insiders wonder who’ll fire the next shot.
“Scott won that round,” one source said. “But I would not want a guy like Musk as an enemy.”
You have no idea what’s going on.
Incidentally, since his money was tied up for nearly a year, he actually LOST money based on other bets he could have made: Gold up 60%, and Semis up 46% vs. his 37%.
Anyone want to bet $350,000 that DOGE didn’t fail, based on an assessment of the true purpose of DOGE and a meaningful timeline?
What is a BLACK SITE?
“But then Patel, Bessent, Blondi, Wiles, etc turned on it with a vengeance”
Not that I am disagreeing or doubting you, but why the hell would they do that?
Which nations are truly sovereign?
Do you routinely take all news at face value?
And you. Do you also think it’s a good idea to assume the headlines are accurate?
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