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Mr. Lutnick appeared as Mr. Trump’s pick to run the Commerce Department. Mr. Ramaswamy decided to step aside from the project just before Mr. Trump took office on Monday.

As a result, Mr. Musk, the world’s richest man, now in full command of the federal cost-cutting effort that Mr. Trump has hailed it as “potentially the ‘Manhattan Project’ of our time.” How exactly Mr. Musk exercises his consolidated power to set the pace and goals of the so-called Department of Government Efficiency remains to be seen. But his first move suggests he will oversee something closer to an IT project than the sweeping operation to cut At least $2 trillion From the federal budget that Mr. Musk had once predicted.

The Musk-led project debuted this week with a bit of bureaucratic jujitsu: the takeover of an existing arm of the White House that had focused for the past decade on improving government technology. The office, the United States Digital Service, now renamed the United States Doge Service, was created in 2014 to fix failed computer systems that threatened the success of President Barack Obama’s health insurance overhaul.

Mr. Musk, who cut 80 percent of the jobs at Twitter after he bought the social media company two years ago, aims to conduct a review of at least some of the roughly 200 employees who work in the office before deciding whether to keep them in their jobs, according to two people familiar with his plan, who spoke on condition of anonymity to describe internal plans.

From this new perch in the administration, Mr. Musk immediately presented a roadmap to the federal bureaucracy that would allow him to quickly assess the technological capabilities of agencies and departments and identify potential changes. He is also expected to maintain an office in the West Wing, which will help him maintain crucial access to Mr. Trump and key White House aides. Mr. Musk’s allies, meanwhile, have secured key administration posts. Amanda Scales, who until this month worked at Mr. Musk’s artificial intelligence company, XAI, is now chief of staff at the Office of Personnel Management, a powerful agency that oversees government hiring.

Mr. Musk posted a meme Last week on his social media platform, since renamed X, hinted at Grand Ambitions for his new project, comparing his menacing effect on government to his company’s innovation of rockets that fuel space travel.

“What matters going forward is actually making significant changes, cementing those changes and setting the foundation for America to be strong for a century, for centuries forever,” said Mr. Musk at a Trump rally in Washington on Sunday.

But the decision to redirect the former digital office to Doge also signals the potential limits of the effort, budget experts said.

Mr. Trump initially said his government overhaul would “reduce wasteful spending” and “cut excess regulations,” but those goals were not explicitly laid out in the order that created the new group.

Doge has been tasked recommends cuts to the federal workforce for the next 90 days and plays a key role in Monitoring of employment practices within four months.

But the office does not have the power to approve spending cuts — that authority remains with Congress.

Romina Boccia, the director of budget and justice policy at the libertarian Cato Institute, said a focus on modernizing government technology could help tackle issues like improper payments. But she said that would likely save only a few hundred billion dollars, far less than Mr. Musk had promised.

“The cynic in me says the Doge realized they were perhaps too ambitious and it would be much more difficult to achieve their original goal of cutting spending by $2 trillion,” Ms. Bocce. “They narrow their scope to something more manageable.”

A White House spokesman did not respond to a request for comment. A spokeswoman for Mr. Musk declined to comment.

During last year’s presidential campaign, Mr. Musk that Doge could reduce the $6.75 trillion federal budget by at least $2 trillion, or about 30 percent. Recently he has lowered His estimate to closer to $ 1 trillion. During the first Trump administration, spending jumped to nearly $8 trillion from about $5 trillion, an increase due to Covid-19 relief efforts. Heading into his second term, Trump has vowed to avoid cuts to Social Security and Medicare, which account for about a third of federal spending.

Some experts on the federal government still said Doge’s influence could be significant because Mr. Musk and his allies will operate from within the federal government rather than outside. Trump’s order called for “Doge teams” to be embedded within federal agencies such as the IRS, a change from Mr. Trump’s original plan to have the mostly government-based group to offer advice to White House officials. Most Doge employees will now be full-time government employees, according to a person familiar with the plans.

“It brings Doge in and connects it with every federal agency in ways that could have a sweeping impact,” said Donald F. Kettl, a former dean of the University of Maryland School of Public Policy.

Simplifying government systems can also be a tool that results in significant benefits for taxpayers, said Mina Hsiang, the most recent administrator of the Digital Service, noting that better technology can help people file taxes or access veterans’ benefits.

“If they choose to work on the everyday issues that affect all Americans, they could accomplish a lot,” said Ms. Hsiang, who was appointed to the role during the Biden administration. “If they’re working on programs that put them in a deeply adversarial position with agencies, I think they’re going to be less likely to get important things done.”

The full extent of how Doge works and what it does may end up being shielded from the public. Mr. Musk hopes to join the administration as a special government employee, according to a person familiar with his plan, a designation intended to avoid triggering a transparency law that requires government panels that include private citizens to hold their meetings publicly and make their documents available. It remains to be seen whether many other Doge employees will also have this designation.

An executive order Mr. Trump signed this week to Institute a hiring freeze Of federal civilian employees emphasized how broad the group’s authority could be. Doge will help work on a plan to reduce the size of the federal workforce “through efficiency improvements and attrition,” according to the order.

Mr. Musk’s team is closely integrated with the Office of Personnel Management, with some of his Doge aides working out of OPM offices, according to a person with knowledge of the arrangement. Federal agencies have been asked to send Ms. Scales, the office’s new chief of staff, lists of all their workers who are on probation – and therefore easier to fire – by Friday.

Another Musk ally is also poised to join the administration: Michael Grimes of Morgan Stanley, a star Silicon Valley banker who helped Mr. Musk with the Bank briefed the talks, according to the people. His interest was first reported by The Wall Street Journal.

An early focus for Doge appears to be the IRS, the sprawling agency with more than 80,000 employees that collected nearly $5 trillion in tax revenue last year.

People involved in Doge, including tech investor Baris Akis, participated in the transition team’s agency review at the IRS, focused on updating the tax collector’s technology systems, according to three people familiar with the work. Mr. Musk has criticized the agency on X as an outdated information technology.

One goal of the new administration is to reduce the number of IRS employees by automating more work, the people said. An executive order from Mr. Trump this week temporarily freezing hiring across the federal government also gave Doge to keep the freeze in place indefinitely at the IRS

Mr. Musk’s focus on technology was at the heart of a philosophical rift with Mr. Ramaswamy, the Ohio biotech entrepreneur that ultimately forced him away from Doge.

Mr. Ramaswamy, a Yale-trained lawyer, had publicly advocated a more politically driven approach, revolving around legislative repeals to “dismantle the administrative state,” something he often pushed off the campaign trail.

A spokesman for Mr. Ramaswamy declined to comment.

The two men had publicly welcomed the chance to lead the Doge for Mr. Trump and even floated the opportunity to host a weekly podcast together. But their differences over how to set priorities quickly led to problems behind closed doors, according to transition aides.

Disagreements included minutiae such as which internal communications software to use. Mr. Musk’s irritation became clear when he privately criticized Mr. Ramaswamy’s approach to the job to associate and kept close to his plans for a more technical-based approach.

While Mr. Ramaswamy focused on conferring with Budget Hawks in Congress, conducted several of Mr. Musk’s closest friends in Silicon Valley interviews at Mar-a-Lago, Mr. Trump’s Florida Resort, on behalf of the Doge Coalition. Some Ramaswamy allies now consider that a mistake, with someone saying Mr. Ramaswamy was “evened out” by Mr. Musk.

Some Trump advisers had also grown wary of Mr. Ramaswamy during the transition, worried that the former presidential candidate was more interested in using his place in the administration to keep his name in the news and vault to political office.

Others claimed that Mr. Ramaswamy’s interest in long-term budget cuts meant focusing on the political process to effect change.

As soon as Mr. Ramaswamy dropped out of the presidential race in early 2024, he began thinking about a run for governor of Ohio. But the split over how to run Doge hastened his decision to leave, according to Ramaswamy allies.

People close to both men said their differences were philosophical, not personal. Mr. Musk, for example, has told people he plans to back Mr. Ramaswamy’s eventual bid for governor.

What was clear was that there was only room for a billionaire at the Doge.

Andrew Duehren, Maureen Farrell, Mike Isaac, Kate Kelly and David E. Singer contributed with reporting.