President-elect Donald Trump has appointed Elon Musk, CEO of Tesla and SpaceX, to head a new panel aimed at reducing government spending.

Musk, known for his ambitious goals, previously suggested cutting $2 trillion from the federal budget.

The panel, co-led by former presidential candidate Vivek Ramaswamy, will target discretionary spending, including defense, which makes up a significant portion of the estimated $6.75 trillion federal outlay for 2024.

Musk's familiarity with government contracts through NASA and the Pentagon, along with his encounters with agencies like the FAA and NHTSA concerning SpaceX and Tesla, positions him uniquely for this task.

Ramaswamy, who founded Roivant Sciences, brings experience dealing with the FDA, an agency he has criticized.

The panel, as stated by Trump, will offer 'advice and guidance' on reducing regulations and spending.

Trump also envisions possible major cuts, although significant budget actions typically require Congressional approval.

Musk assured transparency by promising to publicly list the panel's actions for feedback.

Historically, a similar initiative was launched by President Reagan with the Grace Commission, which offered numerous efficiency suggestions in the 1980s, though few were implemented.

During Trump's first term, he attempted reforms and budget cuts, including eliminating several agencies, but faced resistance.

Musk's track record with cost efficiency is mixed.

Post-acquisition of Twitter (now 'X'), Musk reduced its workforce by half, though the platform's valuation declined.

Contrarily, Musk's SpaceX has revolutionized space travel with cost-effective, reusable rockets.

The panel will likely adhere to the Federal Advisory Committee Act, ensuring objective and transparent advice while managing costs and maintaining records.