Elon Musk appeared in the president's office, defending DOGE together with Trump

Musk said, "The goal of the 'Department of Government Efficiency' is to 'reasonably adjust' the government, investigating federal employees who, despite low salaries, have high net worth, potentially 'enriching themselves at the taxpayers' expense.'

Article author: Luo Zilin

Article Source: Caixin

1. Musk appears in the President's office and defends DOGE together with Trump

On February 11, local time, Elon Musk, the current Minister of the Department of Government Efficiency (DOGE), held his first press conference since joining the Trump administration with President Trump in the Oval Office. At the same time, Trump signed an executive order directing federal agencies to coordinate with the "Department of Government Efficiency" led by Musk to reduce the size of the federal workforce and limit the recruitment of critical positions.

Elon Musk responded to external accusations of 'maliciously taking over' the government in an opaque manner by stating that the people's vote supports major government reforms, and the people will get what they voted for, which is the essence of a democratic system; and the actions of the 'Government Efficiency Department' are 'as transparent as possible'.

Musk said, 'The goal of the Department of Government Efficiency is to 'reasonably adjust' the government. He is investigating federal employees who, despite their low salaries, have high net worth, and may 'make themselves richer at the taxpayers' expense,' and the federal government does not currently need so many people to work for it. He claimed that the Department of Government Efficiency's efforts to cut spending are not 'harsh or radical,' but necessary for 'America as a nation to remain solvent.'

Elon Musk responded to whether his government work would conflict with the interests of the enterprise, stating that all actions of the 'Government Efficiency Department' are completely transparent. He also fully anticipates continuous scrutiny, similar to 'daily checks,' but also expresses that the 'Government Efficiency Department' will make mistakes but will quickly correct them. Trump also responded to this issue, stating that he will not allow Musk to get involved in areas related to interests.

2, Powell: The Fed is not in a hurry to cut interest rates

On February 12th local time, Federal Reserve Chairman Powell stated at the semi-annual monetary policy hearing that the US economy is in good condition. The Federal Reserve hopes to make further progress in controlling inflation. The policy interest rate of the Federal Reserve is in a good position, and there is no reason to further reduce interest rates.

From September to December 2024, the Federal Reserve cut interest rates in three consecutive meetings, totaling 100 basis points. In January 2025, the Federal Reserve paused the rate cuts, stating that it would observe future economic data before making further decisions.

At the hearing, Powell defended the rate cut for 2024, arguing that it was a necessary adjustment to the Fed's policy stance to take into account the improvement in inflation and the cooling of the labor market.

A lawmaker asked Powell why the Fed cannot control long-term interest rates. Powell said that the persistently high long-term interest rates are not particularly closely related to the Fed's policies.

During the hearing, some lawmakers warned that the DOGE team led by Musk has the authority to access the Treasury Department's payment system, which could have an impact.

Powell explained that in the federal government's payment system, the Fed only serves as the "fiscal agent" of the Treasury, not deciding how or why to spend, but only processing payments. Powell said he believes the federal government's payment system is secure.

Powell hinted in his response that he did not want to get involved in partisan disputes. He said that if the Fed focuses only on its work, stays away from politics, it can formulate better policies and reduce inflation.

3. The United States imposed a 25% tariff on imported steel and aluminum from March 12.

On February 10, 2025, the Trump administration announced through a presidential proclamation the restoration of a 25% tariff on all imported steel and an increase in the tariff on aluminum from 10% to 25%. These tariffs will apply to goods entering the United States for consumption on or after March 12, 2025, and will revoke the specific country exemptions and quota arrangements reached in tariff negotiations under the original Section 232 in 2018. As a result, all countries previously exempted or subject to quota management - including Australia, South Korea, Canada, Mexico, Brazil, Japan, the United Kingdom, and the European Union - will now face a 25% tariff on their exports of steel and aluminum to the United States.

The U.S. law firm Holland&Knight analysis suggests that this decision is expected to have far-reaching implications, not only for U.S. manufacturers relying on imported steel and aluminum, but also for global trade relations.

On February 11, local time, a White House official said that U.S. President Trump plans to impose a 25% tariff on steel and aluminum imported from Canada, while the Trump administration had previously threatened to impose a 25% comprehensive tariff on imports from Canada. If these measures are implemented, the two types of tariffs will be stacked together, and Canadian steel and aluminum exports to the United States will be subject to a 50% tariff.

4. Nominee for U.S. Secretary of Commerce Rettig: Considering 'trade tools' against European ESG rules

According to Bloomberg, US Commerce Secretary nominee Luttig said at a confirmation hearing on January 29 that the US may use "trade tools" to retaliate against European environmental, social, and corporate governance (ESG) regulations that impact US companies.

Lutnick specifically mentioned the European Union's Corporate Sustainability Due Diligence Directive (CSDDD) and noted that CSDDD imposes a huge burden on American companies.

According to CSDDD, if a company's value chain is found to violate ESG, the company will face litigation risks. Like most ESG regulations in the European Union, CSDDD's design requires large companies outside the group to comply if they target European customers.

Lutnick said at the hearing that he would consider using all available trade tools at the discretion of the Department of Commerce.