Trump Criticizes Elon Musk and Threatens to Cut Government Contracts
President Donald Trump publicly criticized Elon Musk, labeling him as "CRAZY" amid a heated dispute regarding a significant tax bill. Trump suggested the government should consider terminating Musk's companies' government contracts and subsidies as a way to save billions in the federal budget.
In a social media post, Trump stated, "The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon's Governmental Subsidies and Contracts. I was always surprised that Biden didn't do it!"
Musk quickly responded to the threat with a challenge, writing, "Go ahead, make my day."
Elon Musk’s Business Empire and Government Contracts
Elon Musk leads several high-profile companies, including electric vehicle manufacturer Tesla, aerospace and satellite firm SpaceX, artificial intelligence company xAI, tunneling company The Boring Company, neurotechnology company Neuralink, and owns the social media platform X.
SpaceX, one of the largest federal contractors, secured approximately $3.8 billion in government contracts during fiscal year 2024. Since 2008, Musk’s ventures have amassed over $20 billion in contracts from NASA, the U.S. Air Force, and other agencies. Across more than two decades, his companies have received at least $38 billion through government contracts, loans, subsidies, and tax credits.
Escalating Feud Over Tax Bill and Budget Policies
The explosive dispute has intensified after Musk openly opposed a major tax package supported by Trump. Musk criticized the bill, arguing it would significantly increase the national deficit, and he is actively urging Senate Republicans to block it.
Trump attributed Musk’s opposition to changes in electric vehicle subsidies included in the bill. Earlier, Trump rescinded an electric vehicle mandate that Musk advocated, which he claims upset Musk. Trump voiced, "I took away his EV Mandate that forced everyone to buy Electric Cars that nobody else wanted (that he knew for months I was going to do!), and he just went CRAZY!"
The dispute marks a sharp contrast to their recent cordial interactions, including a public Oval Office event that celebrated Musk’s temporary role at the Department of Government Efficiency weeks prior.
Impact on Tesla’s Stock and Political Repercussions
Following Trump’s comments, Tesla’s share price, which was already declining, experienced a steep drop. The conflict highlights the complex relationship between government support and high-profile business figures within the political landscape.
Trump also asserted Musk’s significant influence on recent political outcomes, claiming, "Without me, Trump would have lost the election, Dems would control the House and the Republicans would be 51-49 in the Senate."
Looking Forward
Musk's companies are expected to continue securing substantial federal funds through existing or forthcoming contracts. For instance, SpaceX is positioned to play a key role in Trump's "Golden Dome" infrastructure initiative.
The ongoing feud between Trump and Musk underscores broader tensions around federal spending priorities, the future of electric vehicle policies, and the role of government contracts in supporting private enterprises.
