During 2014, Daniel Watson-Bey started participating in a federal initiative aimed at supporting minority-owned enterprises, his video production firm included. Benefiting from this scheme, East Hill Media—a business stationed in Landsdale—secured federal contracts to establish video conference infrastructure at the West Point Military Academy, deliver webinars around low-income housing schemes, and offer community engagement for a dam demolition project on Pittsburgh’s Monongahela River. Revenue incrementally bloated over the last ten years, and contributing to Washington’s projects bore significance. Yet, Watson-Bey often felt the frustration of delayed payment, especially from private clients and small municipal bodies.
However, a swift halt was brought to the revenue flow last month when the Trump government discontinued East Hill’s last agreement with the U.S. Department of Housing and Urban Development (HUD). Part of a grand austerity movement, this action intended to shrink the federal government’s size. East Hill’s agreement was just one among dozens of contracts belonging to Pennsylvania-based firms, canceled by the Department of Government Efficiency—better known as the ‘DOGE’ and spearheaded by the world’s wealthiest person, Elon Musk.
The scenario in Pennsylvania provides a glimpse into the unacknowledged work Washington outsources to businesses, small and large, within the state. The range of these tasks extends from providing mental health assistance to workers in conflict regions, researching the safety and risks related to implantable medical devices, to incorporating climate change initiatives from the Biden administration into public housing schemes. Even though Trump’s ‘DOGE’ received appreciation as a reformist measure to cut costs, businesses believe that the economic repercussions will surmount any perceivable returns for states, Pennsylvania included.
Some businesses downplay the repercussions of lost contracts upon their economic structure, while others voice concerns about scaling back operations and initiating layoffs. The cost-saving measures boasted by DOGE remain questioned. For instance, DOGE took credit for voiding a $34 million contract, which the Biden administration had earlier canceled in November. This move contributes to a pattern of inaccuracies that seem to amplify the department’s accomplishment claims.
Approximately 40% of the publicly accessible contracts may not generate any savings since the payment for many of these contracts has already been carried out. An investigation found that some calculations were based on top contract limits for need-based offerings, despite businesses asserting they wouldn’t have logically received the full payment. Verification of DOGE’s claims becomes challenging due to limited data availability.
The DOGE’s online ‘Wall of Receipts’ showcases savings over $15 billion. However, only about one-third of the contracts are visible. Numerous contracts vanished from the online database recently—seventeen from Pennsylvania as of March 3. Yet, data analysis of the available contracts revealed that more than half are connected to two organizations that the White House has marked for cuts: HUD and the Consumer Financial Protection Bureau.
Roughly 57% of the firms enlisted in the Pennsylvania list are owned by minorities, veterans, or women. DOGE has not responded to any request for a comment, and queries concerning the department’s method have been left unanswered. As a result, constituents, irrespective of political allegiance, remain clueless about the cuts.
The contract cuts have aroused concerns about the economic aftermath of Trump’s fervent approach to shrink the federal government’s size. This comes at a worrying time as Pennsylvania workers are also facing mass layoffs. Monica Gould’s consultation company based in Mechanicsburg, JAMA Enterprises, and Strategic Consulting Partners, had four contracts terminated on the DOGE list.
One of these contracts was with the U.S. Department of Agriculture’s dairy scheme, aimed at devising a succession strategy for individuals who regulate and grade America’s milk. Gould’s JAMA introduced a leadership program for younger individuals to help fill positions in an aging industry. Another terminated contract involved training supervisors in the Commerce Department.
Running a certified business for women and minorities, Gould, an emigrant from India since her childhood, found her business listed on the Pennsylvania DOGE list. The contract cancellations follow a significant setback for Gould’s business, ignited by an economic downturn she faced about thirty years ago. Most notable was the cancellation of her most substantial government commitment—a $34 million contract with USAID to aid individuals frequently working in war zones, which led to roughly a 60% business reduction.
Another alarming aspect is that the largest canceled contracts in Pennsylvania suggest DOGE might be inflating its figures. Jurisolutions, a Philadelphia-based company providing project-based legal services, held five listings on Pennsylvania’s list. However, the cancellation of two contracts worth $30 million collectively, has come under scrutiny as this figure significantly contributes to DOGE’s claims of billions in savings.
The impact of federal downsizing on companies appears to be uneven. For Jurisolutions, federal contracts make up only a fraction of their business, making the impact of cancellations far less drastic as executives plan to relocate their attorneys to other client projects. On the contrary, other companies wrestle with severe impacts.
For Watson-Bey and his business, the news of contract cancellation was complicated further by a clerical error when the government accidentally wired his company about $150,000. When asked to return the amount, he had already anticipated an end to his decade-long federal contracts since Trump’s election and had shifted his operations back to his home. But the unexpected termination left him worried about meeting payroll for his three workers, an unfortunate consequence of the DOGE cuts.