The Pentagon’s books are a mess, and D.O.G.E just ripped the lid off one of the biggest financial disasters in government history. The Department of Defense (DoD) lost track of $824 billion last year, and their latest audit only confirms what most already suspected—no one knows where the money went. This isn’t a small accounting error. The DoD’s $4.1 trillion in assets and $4.3 trillion in liabilities were put under scrutiny, and the results are just embarrassing. Out of all the entities inside the Pentagon, only nine managed to pass their audits. One got a “qualified” rating, meaning the books weren’t great but not a total disaster. The remaining fifteen failed completely. Their financials were such a mess that auditors couldn’t even determine whether they were right or wrong. Three major Pentagon branches—the Marine Corps, the Defense Logistics Agency’s National Defense Stockpile Transaction Fund, and the DoD Office of Inspector General—haven’t even submitted their audits yet. Pentagon spending raises questions Sean Parnell, assistant to the secretary of Defense for public affairs, pointed to wasteful contracts in a video posted Monday night. According to him, the Department of Government Efficiency (led by Musk) has identified $80 million in potential savings, though this barely makes a dent in the Pentagon’s $850 billion budget. Parnell called out $13 million in projects that had little to do with military operations. This included: $1.9 million for the Air Force’s “holistic DEI transformation and training” $6 million to the University of Montana to “strengthen American democracy by bridging divides” $3.5 million for “support to DEI groups” from the Defense Human Resources Activity $1.6 million to the University of Florida to study “social and institutional detriments of vulnerability and resilience to climate hazards in African Sahel” “This stuff is just not a core function of our military,” Parnell said, calling these expenses “a distraction.” Parnell claimed this is just the start. He said the DoD will keep cutting unnecessary spending and focusing on making the military more effective. Defense Secretary Pete Hegseth has already outlined plans to reduce military spending by 8% over the next five years. Musk’s D.O.G.E charges agencies for its work While Musk’s D.O.G.E is supposed to make the government more efficient, the group isn’t exactly doing it for free. The Office of Personnel Management (OPM) has been asked to pay over $4 million for work being done by the department between January 20 and July 4, 2026. A draft agreement obtained by CNN shows that OPM is required to fund 20 full-time positions at the highest federal pay scale. According to the agreement, D.O.G.E would modernize OPM’s IT systems. The agency’s internal systems are outdated and incapable of handling current government operations. The agreement also requires OPM to give D.O.G.E full access to its data and systems. Musk’s team insists this is about making the government run better and saving taxpayer money, but critics argue it’s just another way to fire federal workers and access sensitive government data. No one knows if other agencies have been asked to pay for D.O.G.E’s work. The group operates in secrecy. It is housed inside the Office of Management and Budget (OMB), making it exempt from federal public records laws. The White House has also stated Musk is not the administrator of D.O.G.E, only an adviser to Trump, which gives him executive privilege protections. Where is the money coming from? The biggest question is how D.O.G.E is being funded. Previously, the agency was known as the United States Digital Services, but Trump renamed it on his first day in office through an executive order. Since then, it’s been a mystery where the money is coming from and how much the entire operation is costing taxpayers. Musk has repeatedly said he’s a volunteer, and his staff’s pay structure remains unclear. “Some people are federal employees,” Musk told Fox News’ Sean Hannity. “But it’s fair to say that the software engineers at D.O.G.E could be earning millions of dollars a year, and instead are earning a small fraction of that as federal employees.” The draft agreement states that full-time employees would be paid at the highest level of 15 possible grades in the federal pay system. This translates to $141,817 annually at the base rate, but salaries increase based on location. In Washington, D.C., the number jumps to $189,950. Over a 17.5-month period, 20 full-time salaries would cost at least $4.1 million. A government employee at OPM told CNN, “Some people think they are working for free. No, we are paying. It’s like having a contract with an entity to perform services, except this is forced on us so we are forced to do an agreement to retain their services.” Cryptopolitan Academy: Tired of market swings? Learn how DeFi can help you build steady passive income. Register Now
