TheChek News Flow

Elon Musk’s allies have been on site at Centers for Medicare and Medicaid Services offices this week

Representatives of Elon Musk’s Department of Government Efficiency have been working at the Centers for Medicare and Medicaid Services, where they have gotten access to key payment and contracting systems, according to people familiar with the matter.

The DOGE representatives have been on site at the agency’s offices this week, the people said, and they are looking at the systems’ technology as well as the spending that flows through them, with a focus on pinpointing what they consider fraud or waste. DOGE representatives are also examining the agency’s organizational design and how it is staffed, the people added.

White House and DOGE officials didn’t comment.

Musk’s allies have moved swiftly to exert control over vast swaths of the U.S. government, including at the Treasury Department and the U.S. Agency for International Development. They have demanded access to sensitive information at federal agencies and laid out plans to block spending they deem excessive.

CMS in particular is a highly politically and economically sensitive agency. It is the nerve center of much of the nation’s complex healthcare economy, with outlays of about $1.5 trillion in fiscal 2024, or about 22% of the federal total. With around 6,710 employees, it oversees Medicare, the health coverage program for older and disabled Americans and Medicaid, for lower-income enrollees, among other areas. Many veteran CMS staffers have worked there for decades.

A CMS official said in a statement that the agency has “two senior agency veterans who are leading the coordination with DOGE,” and that CMS leaders are “taking a thoughtful approach to see where there may be opportunities for more effective and efficient spending in line with meeting the goals of President Trump.”

One of the systems accessed by the DOGE representatives is CALM, or the CMS Acquisition Lifecycle Management system, which includes information about contracts, according to people with knowledge of the matter.

One of the people familiar with DOGE’s work at CMS said that, to their knowledge, Musk’s allies hadn’t yet been given access to databases that include identifiable personal health information of Medicare or Medicaid enrollees. DOGE also hadn’t yet accessed a sensitive accounting system called HIGLAS, or the Healthcare Integrated General Ledger Accounting System, this person said.

The DOGE access is “read-only,” meaning that its affiliates cannot make changes to the systems, the person added.

Dr. Mehmet Oz, the high-profile physician and former television host, has been nominated to lead CMS, but hasn’t yet been confirmed by the Senate. Several CMS officials who are expected to work under Oz have already taken over at the agency.

Google launched its much-anticipated new flagship AI model, Gemini 2.0 Pro Experimental, on Wednesday. The announcement was part of a series of other AI model releases. The company is also making its “reasoning’ model, Gemini 2.0 Flash Thinking, available in the Gemini app.

Notably, Google is releasing these AI models as the tech world remains fixated on cheaper AI reasoning models offered by the Chinese AI startup DeepSeek. DeepSeek’s models match or surpass the performance of leading AI models offered by American tech companies. At the same time, businesses can access DeepSeek’s models through the company’s API for a relative steal.

Google and DeepSeek both released AI reasoning models in December, but DeepSeek’s R1 got a lot more attention. Now, Google may be trying to put its Gemini 2.0 Flash Thinking model in front of more eyes through its popular Gemini app.

As for Gemini 2.0 Pro, the successor to the Gemini 1.5 Pro model Google launched last February, Google says that it is now the leading model in its Gemini AI model family.

Google accidentally announced the Gemini 2.0 Pro model’s release in the Gemini app’s changelog roughly a week ago. But this time, it’s for real. The company is releasing an experimental version of the model on Wednesday in its AI development platforms, Vertex AI and Google AI Studio. Gemini 2.0 Pro will also be available to subscribers to Gemini Advanced in the Gemini app.

Specifically, the new Gemini Pro model excels at coding and handling complex prompts, per Google, and it comes with “better understanding and reasoning of world knowledge” than any of the company’s previous models. Gemini 2.0 Pro can call tools like Google Search, and execute code on behalf of users.

Gemini 2.0 Pro’s context window is 2 million tokens, meaning it can process about 1.5 million words in one go. Expressed another way, Google’s newest AI model could ingest all seven books in the Harry Potter series in a single prompt and still have about 400,000 words left over.

Google is also making its Gemini 2.0 Flash model generally available on Wednesday. This model was announced in December and is now available to all users of the Gemini app.

Lastly, possibly to rival the excitement surrounding DeepSeek’s models, Google is introducing a new, more cost-efficient AI model, Gemini 2.0 Flash-Lite. The company says this model outperforms its Gemini 1.5 Flash model, but runs at the same price and speed.

Sovereign Wealth fun

We wrote in November that President Trump was super-keen on a US sovereign wealth fund. We first focused on the crypto aspects of his plan, but it’s worth recalling that:

 . . . in September, he promised the Economic Club of New York to make America its own sovereign wealth fund, “to invest in great national endeavour to the benefit of all of the American people”, funded by “tariffs and other intelligent things”. Among a list of uses for this wealth fund, he said that it would “return a gigantic profit which will help pay down national debt”.

On Monday, he signed an Executive Order directing the Secretary of the Treasury to come up with a plan within 90 days to create a Sovereign Wealth Fund.

Rather touchingly, the executive order ends by noting that the UK wants to start developing its own SWF.

This may have been a way to forestall the common criticism that countries need to run budget surpluses if they want to build sovereign wealth funds. We actually agree they don’t. Sovereign Wealth Funds tend to be canonically divided into savings funds (piggy banks for the distant future), stabilisation funds (piggy banks for rainy days), and strategic funds (special purpose vehicles into which state assets can be thrown and managed). Turkey, for example, has run a SWF despite a persistent budget deficit and current account deficit over the past decade.

Anyway, the EO argues that a SWF could start with the $5.7 trillion in assets that the US government already directly owns when natural resource reserves are excluded.

That’s a lot of assets! Unlike thousands of other US government websites, the US Treasury’s website has not yet been taken down. On it we found a government balance sheet detailing assets worth $5.4 trillion at the end of 2023, which is maybe close enough. So what are they?

There’s a lot to chew on. Being America, the numbers are all very large.

It’s striking, for example, that the federal government’s $566 billion valuation of all of its furniture, fixtures and equipment eclipses the combined market value of Australia’s Future Fund and Singapore’s Temasek. And its book of student loans and tax prepayments together had the same value as Tesla. (Not that we’re suggesting that this would be a good trade.)

Hidden away in the Cash & Other Monetary Assets section is the country’s gold reserve, valued at a mere $11 billion of book value. Using today’s market price this would swell what we’ll call the MAGA Fund by a further $732 billion, to a little over $6 trillion.

Chucking all your office furniture into a Sovereign Wealth Fund to raise the potential asset value may strike some as a little preposterous. But we thought we’d give you a glimpse as to the international sovereign wealth asset landscape in the event that this was pulled off.

How would this new fund work? Early signs are that governance might be top-heavy. On signing the Executive Order, this is what Trump had to say:

We’re going to be doing something, perhaps with TikTok, and perhaps not. If we make the right deal, we’ll do it. Otherwise, we won’t but I have the right to do that. We might put that in the sovereign wealth fund.

Readers will recall that one of Trump’s first actions on taking office was to suspend for 75 days the enforcement of a law requiring ByteDance, TikTok’s Chinese parent company, to sell or close down the site in the US — supposedly on national security grounds. Faced with closure, we don’t have to stretch too hard to imagine that the price of otherwise zeroed assets might not be high. And if Trump really is the type to make offers you can’t refuse, any US Sovereign Wealth Fund might be able to quickly accrue assets at low prices.

A President-led governance framework would also give the administration the ability to provide an exit for any friends trapped in private equity deals or those seeking to cash out of private firms at elevated valuations. So swings and roundabouts.