Donald Trump warns Elon Musk of ‘consequences'. How can he potentially hurt his interests?
US President Donald Trump's explosive row with billionaire Elon Musk, his biggest backer in the 2024 Presidential election, has raised only one question: Will it hurt the Tesla and SpaceX CEOS' businesses?
Trump warned of 'serious consequences' for Musk, but that was in the context of the world's richest man backing candidates against Trump's Republicans in next year's midterms.
'If he does, he'll have to pay the consequences for that,' Trump told NBC, though he declined to share what those consequences would be.
It all started with Elon Musk's public criticism of Donald Trump's Big Beautiful spending bill, which he called a 'disgusting abomination'. That started what became one of the ugliest but also most-watched public spats between two of the most powerful men in the world.
The spat with Donald Trump could certainly hurt Elon Musk and his businesses, as he may have made an enemy out of the world's most powerful leader.
Musk's businesses have many lucrative federal contracts that Trump could take back. According to a report by The Hill, SpaceX alone holds federal contracts worth over $22 billion, and the US President has already threatened to take them all back.
'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!' Trump wrote on Truth Social the day it all flared up.
While the Republican leader hasn't walked the talk yet, he certainly has the power to do so, as he pointed out in the NBC interview on Saturday.
'I'd be allowed to do that. I haven't given it any thought,' he said.
Even if that doesn't happen, making an enemy in the Oval Office is not good for business. Elon Musk would need favourable policies for his businesses, like tax credits for EVs, one of the points that might have brought the situation to where it is now.
The very public spat also could shake investor confidence, as seen by the free fall that Tesla's share prices saw on Thursday. It wiped $153 billion off the company's valuation before rebounding a bit on Friday. But the longer it drags out, the harder Wall Street will react to it. And for a person whose entire net worth is bound by the share prices of his companies, it is not a good sign.
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Hindustan Times
22 minutes ago
- Hindustan Times
Donald Trump has many ways to hurt Elon Musk
THERE WAS a time, not long ago, when an important skill for journalists was translating the code in which powerful people spoke about each other. Carefully prepared speeches and other public remarks would be dissected for hints about the arguments happening in private. Among Donald Trump's many achievements is upending this system. In his administration people seem to say exactly what they think at any given moment. Wild threats are made—to end habeas corpus; to take Greenland by force—without any follow-through. Journalists must now try to guess what is real and what is for show. So it is with the break-up between Mr Trump and Elon Musk, the world's richest man and until last week a 'special government employee'. A few months ago Mr Musk posted on X, his social-media platform, that he loved the president 'as much as a straight man can love another man'. On May 30th, at a joint press conference in the Oval Office to announce Mr Musk's departure from government, Mr Trump called him 'an incredible patriot' and praised his work with the Department of Government Efficiency (known as DOGE). Yet by June 5th it had all broken down. On his Truth Social media platform the president posted that the billionaire was 'wearing thin' and 'went CRAZY'. Mr Trump then threatened to 'terminate' his government contracts. Mr Musk responded on X, claiming that Mr Trump's name appears in the government's files on Jeffrey Epstein, the late financier who was convicted of trafficking and having sex with underage girls. 'That is the real reason they have not been made public,' wrote Mr Musk. Later he agreed with a post saying that Mr Trump should be impeached. He also said he would begin decommissioning his Dragon spacecraft, which transports astronauts to the International Space Station. If carried out, the threats could be disastrous for both men. Mr Trump could lose a valuable donor and the supportive sway of X; Mr Musk's business interests could suffer enormously. But in response to a comment advising him to 'cool off', Mr Musk wrote 'good advice' and backtracked on his call to decommission the Dragon. Where things go from here is anyone's guess. The initial cause of the falling out between Mr Trump and his 'first buddy' was the president's so-called 'One Big Beautiful Bill'. Mr Musk was incensed that the measure would add enormously to the deficit, and so undermine the work of DOGE. On June 3rd he escalated his criticism, calling the bill a 'disgusting abomination'. On June 5th he added another complaint, saying that Mr Trump's tariffs are going to bring about a recession. Mr Trump has his own explanation for Mr Musk's sudden disloyalty. He says the Tesla CEO is unhappy because his bill would cancel a government subsidy for electric cars created by Joe Biden. If Mr Trump does decide to retaliate, the risks to Mr Musk and his businesses are extensive. The threats the president has already made, however, are the least credible. Cancelling the contracts of SpaceX, Mr Musk's space company, would be profoundly disruptive to the government. Without SpaceX rockets, it would struggle to put anything into space, including spy satellites. The Pentagon relies heavily on the firm's Starlink satellites. SpaceX itself could probably weather such moves. Though it has benefited greatly from government contracts, the firm's commercial revenues soared nearly three-fold last year, according to estimates by Quilty Space, a business-intelligence firm. Mr Musk has also wanted to cancel the Dragon spacecraft for some time. Steve Bannon, a former adviser to Mr Trump who is no fan of Mr Musk, has proposed even bigger penalties. He wants the South African-born billionaire to be stripped of his American citizenship—he says Mr Musk is an 'illegal alien'—and his companies nationalised under the Defence Production Act. Such actions also seem unrealistic. Stripping Mr Musk's citizenship would require a judge to rule he committed fraud. The Defence Production Act almost certainly does not permit sudden nationalisation, even if the country is at war. That does not mean Mr Musk can breathe easy, though. His interests are vulnerable to more routine measures. At the time he entered government in January, he and his companies were subject to 65 potential or actual regulatory actions by 11 federal agencies, according to the minority staff of the Permanent Subcommittee on Investigations, an arm of the Senate. 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28 minutes ago
- Mint
How Trump's trade war is supercharging fast fashion industry
Sydney, When US President Donald Trump introduced sweeping new tariffs on Chinese imports the goal was to bring manufacturing back to American soil and protect local jobs. However, this process of re-shoring is complex and requires years of investment and planning – far too slow for the world of ultra-fast fashion, where brands are used to reacting in weeks, not years. Many clothing companies started to move production out of China during Trump's first term. They relocated to countries such as Vietnam and Cambodia when the initial China-specific tariffs hit. This trend accelerated with the newer 'reciprocal' tariffs. Instead of re-shoring production, many fashion brands are simply sourcing from whichever country offers the lowest total cost after tariffs. The result? The ultra-fast fashion machine adapted quickly and became even more exploitative. 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Some ethical brands are already showing a better way and offer clothes made under fairer conditions and with sustainable materials. These clothes are not as cheap or fast, but they represent a more conscious alternative especially for consumers concerned about synthetic fibres, toxic chemicals and environmental harm. Trump reshuffled the deck, but did not change the game Trump's trade rules aim to re-balance global trade in favour of American industry, yet have cost companies more than USD 34 billion in lost sales and higher costs. This cost will eventually fall on US consumers. In ultra-fast fashion, it mostly exposed how fragile and exploitative the system already was. Today, brands such as Shein and Temu are thriving in Australia. But unless we address the systemic inequalities in fashion production and rethink the incentives that drive this market, the true cost of cheap clothing will continue to be paid by those least able to afford it. PY PY This article was generated from an automated news agency feed without modifications to text.
