Trump Indicates Review of Elon Musk's Federal Contracts
US President Donald Trump announced he has no plans to speak with Tesla and SpaceX CEO Elon Musk, highlighting a growing rift between the two former allies. Speaking aboard Air Force One, Trump stated he hopes Musk does well with Tesla but indicated a thorough examination of Musk's substantial government contracts is forthcoming.
"We'll take a look at everything," Trump said, emphasizing the significant monetary scale involved. This marks a shift from their previous cooperative relationship, as Trump considers possible changes including discontinuing use of his red Tesla Model S displayed at the White House.
Escalating Political Tensions Over Tax and Spending Bill
The feud intensified following Musk’s vocal opposition to a major Republican tax and spending bill championed by Trump. Musk criticized the legislation on social media, describing it as detrimental politically and financially, highlighting concerns it would worsen the national debt, which currently stands near $36.2 trillion.
The Tesla CEO also called for the formation of a new political party to represent the majority of Americans, reflecting his frustration with the status quo. Meanwhile, Musk’s past financial support has been pivotal to Trump’s political efforts, including substantial backing during the 2024 presidential campaign.
Impact on Congressional Dynamics and Republican Agenda
The Republican-backed bill narrowly passed the House and faces further adjustments in the Senate. Analysts warn the measure could add approximately $2.4 trillion to the national debt over a decade, complicating GOP efforts to maintain fiscal discipline.
House Speaker Mike Johnson confirmed ongoing communication with Musk, expressing hope for reconciliation between the entrepreneur and lawmakers.
Business and Political Fallout
Following the public dispute, Tesla’s stock rebounded somewhat after a historic single-day loss, which had wiped out $150 billion in value. Musk’s allies in the investment community have called for an apology towards Trump, citing the president's patience amid disappointing behavior.
Trump has threatened to terminate government contracts with Musk’s companies, including SpaceX and its Starlink satellite service, although Musk later retracted a threat to retire SpaceX's Dragon spacecraft—currently the only US vehicle capable of ferrying astronauts to the International Space Station.
Personnel Disputes and Administration Tensions
The conflict deepened after Trump revoked Musk's ally Jared Isaacman's nomination to head NASA, reportedly due to concerns over Isaacman’s prior political donations. Internal disagreements between Musk and White House personnel director Sergio Gor further strained relations. Although praised for his staffing efforts, Gor’s interactions with Musk remain contentious.
Potential Political Consequences
The ongoing feud could jeopardize Republican prospects in upcoming midterm elections, especially if Musk withdraws financial contributions or if other Silicon Valley leaders distance themselves from Trump. Musk has indicated an intention to reduce political spending and urged voters to remove politicians who have betrayed public trust.
Public backlash against Musk’s involvement with the Trump administration has already affected Tesla’s sales and investor confidence, with protests at Tesla facilities highlighting the challenges of balancing business and political interests.
