Elon Musk dangers battle of curiosity in Trump administration – DW – 11/20/2024 | EUROtoday

Loads has been written in regards to the budding friendship between President-elect Donald Trump and the world’s richest man, Elon Musk.

What appeared like a wierd pairing has became a job alternative for Musk and, prior to now week, the 2 have been seen collectively in Palm Beach, Florida, ringside at an Ultimate Fighting Championship match in New York and consuming McDonald’s on a jet.

Before the election, Trump introduced he would put the South Africa-born Tesla CEO in command of a authorities effectivity fee. Last week, Trump made it extra concrete and confirmed the brand new company might be known as the Department of Government Efficiency, or DOGE.

What is Musk’s new job?

Since will probably be a brand new company, nobody actually is aware of what it should do and what authority it should have. In the top, it should probably be a small advisory group that operates outdoors of the federal government with none actual regulatory authority. What it’s prone to have is affect and a loud mouthpiece within the type of Musk.

The Department of Government Efficiency goals to slash the US federal funds — which totals roughly $6.8 trillion (€6.4 trillion) in fiscal 2024 — by $2 trillion in an effort to completely downsize the federal authorities, chopping forms, rules and wasteful expenditures.

Though Musk is thought for chopping prices at his personal companies, lowering federal spending might be an enormous problem. The challenge is meant to wrap up by July 2026.

Donald Moynihan, a professor of public coverage on the Ford School of Public Policy on the University of Michigan, thinks Musk has “no real experience with government beyond suing it or spreading conspiracy theories about it.” He instructed DW that the federal authorities must be modernized, “but the only thing Musk has talked about is cutting costs and punishing people he disagrees with. His basic math does not add up.”

In 2023, a third of the then $6.1 trillion funds went to social safety and Medicare — applications Trump has mentioned he wouldn’t contact. Overall, solely $1.7 trillion was discretionary spending that lawmakers management via appropriation acts, based on the nonpartisan Congressional Budget Office.

SpaceX and a billion-dollar battle of curiosity

Musk already has a lot on his plate working six firms like Tesla, SpaceX and social media platform X. Such a brand new place is rife with conflicts of curiosity, particularly since a lot of his firms obtain authorities subsidies or direct federal contracts, making them authorities contractors. They additionally develop and use improvements and expertise which have pushed regulatory boundaries.

“I cannot think of another instance of someone with such clear and obvious conflicts with a public official offering advice on the budget, structure and removal of employees that directly affect his businesses,” mentioned Moynihan. “It is cartoonishly corrupt.”

Over the years, SpaceX has acquired billions in contracts from NASA and the Department of Defense to launch satellites, service the International Space Station or use its Starlink satellite tv for pc communication community.

Over the previous decade, these SpaceX contracts got here in at greater than $15 billion, based on numbers crunched by the New York Times. Last yr alone, his firms received 100 totally different contracts with 17 federal companies totaling $3 billion.

Some of the opposite conflicts of curiosity

Musk has a report of very public altercations with federal departments and different regulators. An investigation by US monetary market regulator, the Securities and Exchange Commission (SEC), led to fees of securities fraud in 2018. Stepping down as Tesla’s chairman was a part of the later settlement.

Tesla has acquired big tax breaks and different incentives from varied states. On the federal stage, it has a small authorities contract to produce some autos. But Musk might persuade Trump to maintain tax credit for electrical autos (EVs) in place to maintain up gross sales, or enhance tariffs on rivals that make autos in Mexico or wherever else.

He might affect regulators who need to look nearer at Tesla’s self-driving push. He might additionally persuade these in energy to maintain emission guidelines in place that permit Tesla to promote credit value billions of {dollars} to different automakers that don’t produce sufficient EVs.

Musk’s different firms, xAI, The Boring Co, Neuralink and X, haven’t any authorities contracts. Still, they’ve loads to realize from being near Trump. This closeness might propel synthetic intelligence (AI), affect different rules or assist block social media rival TikTook.

Could the Trump-Musk friendship finish?

Trump just isn’t the primary president who needs to chop spending or has known as in effectivity consultants. What is totally different this time is who the President-elect is asking on and the probabilities of non-public acquire.

So far, Trump has been cautious to say that Musk wouldn’t be an official a part of the chief department of presidency and solely “provide advice and guidance from outside of government, and will partner with the White House and Office of Management & Budget to drive large scale structural reform.”

This is vital as a result of federal regulation prohibits folks from participating in authorities issues the place they’ve a monetary curiosity.

The most unpredictable a part of this complete challenge is Trump himself. He has an extended monitor report of selecting favorites after which all of the sudden dropping them. Dropping the world’s richest man might be an irresistible ego enhance to Trump in the future.

They are two large personalities who love the limelight, however Trump “cannot stand to be upstaged,” mentioned Moynihan.

Keeping this unlikely relationship going might be a problem equal to chopping trillions.

“In some ways, assigning Musk to an advisory committee might be seen as a demotion, since it is not clear if it will get anything done,” he mentioned.

Edited by: Uwe Hessler