Elon Musk and Donald Trump during a campaign event in Butler, Pennsylvania, on 5 October 2024. (Photo: Justin Merriman / Bloomberg) Musk and Ramaswamy "will pave the way for my Administration to dismantle Government Bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure Federal Agencies," Trump said in a statement.
Trump said the new department "will provide advice and guidance from outside of government," signaling the entity would operate outside the confines of government.
However, it would work with the White House and Office of Management & Budget to "drive large scale structural reform, and create an entrepreneurial approach" to government never seen before.
Trump said their work would conclude by July 4, 2026, making it a "gift" to the country on the 250th anniversary of the signing of the Declaration of Independence.
Musk, ranked by Forbes as the richest person in the world, already stood to benefit from Trump's victory, with the billionaire entrepreneur expected to wield extraordinary influence to help his companies and secure favorable government treatment.
Musk gave millions of dollars to support Trump's presidential campaign and made public appearances with him. Trump had said he would offer Musk a role in his administration promoting government efficiency.
Read more: Rasputin’s return — what does Elon Musk really want, now that the US election is over?
He has many links to Washington and his lineup of companies includes electric car company Tesla TSLA.O, social media platform X and rocket company SpaceX.
"This will send shockwaves through the system, and anyone involved in government waste, which is a lot of people!" Musk said, according to Trump's statement, which called the new government initiative "potentially 'The Manhattan Project' of our time," referring to the U.S. plan to build the atomic bomb that helped end World War Two.
Ramaswamy is the founder of a pharmaceutical company who ran for the Republican presidential nomination against Trump and then threw his support behind the former president after dropping out.
"We will not go gently, @elonmusk," Ramaswamy said on X.
Musk reposted the announcement from Trump on his X account and added comments such as that, "The merch will be (fire)," using three fire emojis, and, "People have no idea how much this will move the needle!"
He also posted: "Threat to democracy? Nope, threat to BUREAUCRACY!!!"
The acronym of the new department - DOGE - coincides with the name of the cryptocurrency dogecoin that Musk promotes.
(Reporting by Daniel Trotta and Eric Beech; Editing by Sandra Maler & Shri Navaratnam)