Ramaswamy cites legacy tech and fraud as early DOGE priorities

Vivek Ramaswamy wants to use the Department of Governmental Efficiency to update the government's antiquated technology and stop fraud in government programs, efforts he called “low-hanging fruit” for his work alongside billionaire Elon Musk.

The duo is leading the DOGE, which — despite the name — is an advisory effort, not a government department. Big goals include slashing the government’s headcount, paring back government regulations and cutting spending. 

“Technology improvements across the federal government are not only going to be important, [but] I think it’s necessary in order to actually get the job done,” Ramaswamy said Wednesday at the Aspen Security Forum.

The federal government spends over $100 billion on IT and cybersecurity every year, according to the Government Accountability Office. 

“The government has a legacy IT problem,” GAO’s Kevin Walsh told lawmakers last year. 

As technology gets older, it costs more, doesn't always meet the needs of agencies and becomes dependent on an increasingly smaller pool of employees that know how to operate outdated technology like COBOL, a legacy programming language still used in parts of the government. Old tech can also open the government up to cybersecurity risks.

“A basic modernization of the software, of the technology, of the rails on which the federal government's information actually flows — that's low hanging fruit,” Ramaswamy said Wednesday after calling “COBOL on mainframes” the “norm” for the federal government. 

“I don't care if you're Republican or Democrat, it's going to strictly improve the effectiveness with which the taxpayer dollar is actually spent,” he added. “I hope that's why our success is going to be one that isn't a partisan victory, but it's something that goes beyond traditional politics to say that we're actually making government function more efficiently and effectively, and as a result, it turns out that we have to spend a lot less money [and] we need a lot fewer bureaucrats doing it.”

Government modernization has been a target for administrations on both sides of the aisle.

For Ramaswamy, seeing cost savings could take time, as efficiencies and cost savings from replacing legacy IT aren’t immediate, said Robert Shea, former senior official at the Office of Management and Budget who is CEO of consulting firm GovNavigators.

Modernization also takes money, he said, noting that “it’s all going to cost significantly more in the short-term” before the government would see any long-term cost savings. Some government IT projects struggle to see cost savings at all.

But what happens next for agency IT budgets in order to do the work Ramaswamy is pushing isn’t clear. 

In the first Trump administration, agencies saw slight increases in their federal IT and cyber budgets year-over-year, Michael Hettinger, a former senior congressional staffer who lobbies on behalf of technology companies, told Nextgov/FCW via email. 

Trump also signed legislation that created a centralized revolving fund for IT called the Technology Modernization Fund during his first tenure in the White House. But all the talk from the DOGE and its supporters of slashing government spending makes it hard to predict what happens next, said Hettinger.

The IRS is currently begging lawmakers to fund their ongoing technology updates as lawmakers look to another, stopgap continuing resolution. The tax agency is in the process of modernizing its 1960s-era legacy system for individual tax processing with billions it got from the Democrats’ Inflation Reduction Act. Republicans on Capitol Hill have attempted to pull back that funding.

Musk himself — Ramaswamy’s counterpart for the DOGE — has mused on X, formerly Twitter, about whether the IRS budget should be “deleted.”

The Social Security Administration has paused its IT investments during the current continuing resolution due to a lack of funding, it told GovExec in October.

Ramaswamy pointed to problems with government data as an example of necessary improvements. 

“Think about the data siloes. You’ve got to compare whether or not you have excess spending or waste, fraud, abuse by comparing different databases. Often you can't do that because that information is siloed in different houses, in different parts of the federal bureaucracy that don't talk to each other,” he said, also pointing to the potential for “synchronous systems” with compatible software.

Data problems have indeed been a common complaint among those trying to address problems with fraud in government programs, and they've asked lawmakers to permanently stand up a data analytics center that previously tracked pandemic spending. A similar capability after the 2008 recession shuttered years later.

If Ramaswamy moves ahead with a push to modernize government tech, he’ll likely face challenges working across a landscape where digital leadership in the federal government is dispersed across organizations, as noted in recent report from the Global Government Forum informed by interviews with 13 members of the CIO Council and the current federal CIO Clare Martorana.

There’s also been “a lack of a clearly stated ambition, political sponsorship and representation for technology at the highest levels of government,” that report noted.

Other evergreen challenges include the lack of multi-year budgets to support modernization and the complexity of upgrading old software that’s changed over decades to meet business needs and policy changes. The IRS has been trying to fix its system for individual tax account administration since at least 2009. 

Program integrity

Ramaswamy also pointed to program integrity efforts as a potential place to reap cost savings. Problems with fraud and other payments that shouldn’t have been made by the government are also a long-standing problem that others have tried to tackle before. 

“What if you could just look at what savings we could get to by making sure that nobody who isn’t even supposed to receive that payment is actually getting it?” he said of entitlement programs like Medicare, Medicaid and Social Security. 

Last year, the government’s tally for “improper payments” was about $161.5 billion, a decrease from recent years after improper payments spiked during the pandemic as the government tried to push emergency funding out the door. 

That total, however, is a mishmash of payments that the government shouldn’t have made or paid in the wrong amount. It goes beyond when the government pays out money to fraudsters.

The $161.5 billion, for example, includes about $6 billion in “technically improper payments,” which aren’t monetary losses — they are payments made to the right person in the right amount that didn’t meet every regulatory or statutory requirement. A missing signature, for example, can make something an improper payment.

It also includes payments that weren’t made but should’ve been.

Program integrity issues with entitlement programs like Medicare, Medicaid and Social Security could add up to “probably hundreds of billions of dollars in savings” if solved, Ramaswamy said. 

Those three programs tallied $89.3 billion in “overpayments” to beneficiaries in fiscal 2024, according to government data. That’s things like payments to people who aren’t eligible or payments above what someone was owed.

The idea of savings can get complicated quickly, though. The Congressional Budget Office doesn’t score the effects on waste, fraud and abuse associated with spending on program integrity efforts.

Also, “the way our programs are written, the money allocated to mandatory programs is fungible. Money you save in one place is just going to be poured back into the same program,” Shea said of fraud prevention savings.

In terms of recovered fraudulent funds, they sometimes go to the Treasury and other times to trust funds, Johana Ayers — managing director of GAO’s forensic audits and investigative service team — told Nextgov/FCW over email. 

Big picture, “a lot of these things have been tried before and though [they] may improve operations, savings are a tougher thing to come by,” said Shea.