Can Elon Musk Just Help Himself to Your Bank Account?
On February 14, 2025, New York City Comptroller Brad Lander released a statement saying that the federal government “had, at Elon Musk’s direction, removed $80 million from one of the City’s bank accounts.” Musk’s people hadn’t given any kind of notice, or gone through any kind of legal process; they just took the money, which had been appropriated by Congress and approved for disbursal by the Biden Administration, and was now showing up on New York City’s books. Evidently the money had been disbursed in a way that was, for technical reasons, grab-backable.
The $80 million went towards the Shelter and Services Program (SSP), a FEMA-administered initiative to house nonresident migrants who had been released by the Department of Homeland Security and now had no place to stay. The Trump Administration disapproves of the SSP, and was evidently not satisfied with just killing it going forward. On X, Musk accused the city of misusing federal funds by housing migrants in “luxury hotels,” but offered no evidence for that claim. Comptroller Lander observed that the program had a spending limit of $12.50 per person per night, which doesn’t sound luxurious for shelter in New York City.
I don’t know enough about the SSP to know whether it’s a good program or not. Obviously the Trump Administration has a far more severe attitude towards nonresident migrants than the Biden Administration did. What concerns me here is whether the federal government, or even an informal advisor to the federal government, like Elon Musk, has the power to go into a bank account and, without due process of law, just help themselves to the money. That seems as if it could be a problem.
I understand that the IRS has the power to ‘levy’ a bank account, i.e. seize money from someone who owes taxes. But that is a legal process. Thirty days’ notice must be given. The penalized can appeal. The government has to jump through all kinds of hoops, and you are entitled to know about those hoops. What Musk did with New York City has none of those features.
According to Nathan Tankus, an economist who has studied this issue, Musk probably does not have the ability to, say, garnish an individual’s Social Security payment – yet. But two of DOGE’s ongoing activities have been (a) vacuuming up an enormous amount of private information, including, presumably, financial information, and (b) acquainting itself with – and, in at least one documented case, tinkering with the computer code of – the basic procedures (“plumbing”) through which banks and government agencies make payments. Why exactly would they be looking into those two areas? Academic curiosity?
One of the bedrock principles not only of American democracy, but of American capitalism, is that property can’t be seized without due process of law. If I want money from you, I have to sue you, and a court has to find in my favor. If we dispense with that requirement, then anyone with the technical know-how can, without risk to themselves, empty other people’s bank accounts. That would, obviously, foster corruption. It would also promote dictatorship, because if I have the power to seize all your money, I can probably count on your vote. And it would lead to widespread poverty.
Why poverty? There are a couple of major reasons. One is that no one wants to do business in a country where their funds can be stolen at will, so investment capital will take itself to a more law-abiding place. The other reason is that if the banks can’t be trusted, people won’t use the banks: they’ll do some equivalent of hiding their money under the bed. Without deposits, banks won’t have anything to lend, so no one will have access to credit. You won’t be able to take out college loans. You won’t be able to buy a house. You won’t be able start a business. You won’t be able to invest for the future. The law isn’t only what keeps us free. It’s what keeps us solvent.
This isn’t just about the federal government and New York City squabbling over $80 million. It’s about whether the two most powerful people in America, Donald Trump and Elon Musk, can take whatever they want from anyone.
~ STUDEBAKER (Studebaker@studebakerguy.bsky.social)
