The Musk deputy running DOGE’s huge cost-cutting drive
Summary
Steve Davis is a force at DOGE, which has adopted Musk’s move-fast-and-break-things approach.
WASHINGTON—When Elon Musk acquired Twitter in 2022, one of his top lieutenants was so focused on cutting costs that a former employee recalls him asking how much the company paid for janitorial services in an Atlanta data center.
It was a typical inquiry from Steve Davis, a leader of Musk’s Boring Co., who at Twitter reduced expenditures, squeezed vendors and raced to remove top brass and keep rank-and-file workers off-balance, former employees said. The move-fast-and-break-things approach sparked confusion and chaos, a former employee recalled.
The pursuit of efficiencies that rocked Twitter is providing a playbook for the federal government, where Davis is coordinating Musk’s Department of Government Efficiency. Anxiety has permeated agencies across Washington, as Musk executes President Trump’s campaign pledge to slash government spending.
Trump’s appointed U.S. attorney for Washington, D.C., Ed Martin, offered to help Davis and Musk in a letter posted on X on Friday.
“If people are discovered to have broken the law or even acted simply unethically, we will investigate them and chase them to the end of the Earth," Martin wrote.
DOGE has gained access to technologies within departments across the government including the U.S. Agency for International Development, the Treasury and the agency overseeing Medicare and Medicaid. DOGE staff accessed the Treasury’s payments system, which they say they are scouring for evidence of waste. DOGE official Tom Krause has become Treasury’s fiscal assistant secretary, the agency’s website says.
A federal judge in New York on Saturday temporarily restricted DOGE’s access to the Treasury’s payment system. Judge Paul Engelmayer, an Obama appointee, set a hearing in the case for Friday.
DOGE’s take-no-prisoners approach has been most evident in the Trump administration’s dismantling of USAID, the 10,000-person, $40 billion foreign-assistance agency. Davis and Musk are driving the effort, said a USAID official. Davis is in regular contact with Peter Marocco, who is directing the working arrangement for USAID under the State Department.
Davis’s prominence at DOGE surprised few who have dealt with Musk. When the Tesla and SpaceX chief executive officer acquired Twitter, employees were struck by Davis’s deep involvement across the company. He influenced product, purchasing and talent.
And he was relentlessly attentive to marshaling data to cut costs. In exhibits from a lawsuit former Twitter employees filed in 2023, Davis participated in email conversations tied to cost-cutting. One email to Davis had the subject line “Daily Savings Email-Draft: Nov. 10, 2022." Another is labeled “Mistaken RIF" (Reduction in Force).
The continuing lawsuit described Davis as determined to cut deeply to appease Musk. During a 2022 meeting of Musk deputies, Davis said the social-media company would stop working with brokers to negotiate property leases to reduce costs, according to the lawsuit. Asked why, Davis and other Musk allies at the meeting said, “Elon wants this," the records show.
Davis asked Twitter’s then-vice president of real estate Tracy Hawkins to find $500 million in annual savings. After Hawkins and her team warned Davis of financial risks of breaking leases, such as termination fees, Davis said, “Well, we just won’t pay those. We just won’t pay landlords," according to the lawsuit.
When a Twitter employee told Davis that the company would need a building permit to install a private bathroom next to Musk’s office, Davis was dismissive.
“We don’t do that; we don’t have to follow those rules," Davis said, according to the lawsuit.
Another former Twitter employee said in an interview that Davis scrutinized details such as the cost per square foot of a rental agreement or how teams settled on rates for services. The person said a common tactic was to halt payments to vendors, forcing them to renegotiate more favorable terms for Twitter.
Davis, a devotee of Ayn Rand and an aerospace engineer who earned degrees from the University of Pennsylvania and Stanford, was an early hire at SpaceX and has worked for Musk for more than two decades.
During his first stay in Washington, Davis was working at SpaceX and pursuing a doctorate in economics at George Mason University in 2008 when he observed a lack of frozen yogurt options in the district. He decided to fill the gap.
He called the shop Mr. Yogato, and it quickly gained a following, in part because of the oddball nature in which customers could earn discounts. Examples: Customers who sang along to the 1980s song, “Mr. Roboto," would receive a 10% discount. Customers who stumped Davis on trivia from “Seinfeld," or Nicolas Cage’s film, “The Rock," got 10% off.
In a 2015 interview with journalist Jeff Pearlman, Davis said he was an undergraduate business student when the 1998 film, “Armageddon," inspired him to enroll in engineering school. That led to graduate school in aeronautic engineering and, eventually, SpaceX.
“In conclusion, my entire life path was redirected by a Bruce Willis movie," Davis said.
Alexander Ward and Alexa Corse contributed to this article.
Write to Ken Thomas at ken.thomas@wsj.com, Brian Schwartz at brian.schwartz@wsj.com and Becky Peterson at becky.peterson@wsj.com
