Trump's Win, Musk's Reward: SpaceX Executives Set for Government Roles, Musk Could Gain Regulatory Power

Trump's Win, Musk's Reward: SpaceX Executives Set for Government Roles, Musk Could Gain Regulatory PowerElon Musk, who invested significant time and money in former President Donald Trump's re-election campaign, is now seeking a return on his investment. Two sources revealed that Musk wants Trump to appoint executives from his rocket company, SpaceX, to government positions, including those at the Department of Defense

Trump's Win, Musk's Reward: SpaceX Executives Set for Government Roles, Musk Could Gain Regulatory Power

Elon Musk, who invested significant time and money in former President Donald Trump's re-election campaign, is now seeking a return on his investment. Two sources revealed that Musk wants Trump to appoint executives from his rocket company, SpaceX, to government positions, including those at the Department of Defense. This would mean SpaceX employees getting access to its biggest customer, the government.

Musk invested over $100 million in Trump's campaign and continuously supported Trump on the social media platform X, formerly Twitter. He also campaigned for Trump in the crucial state of Pennsylvania, actions that have brought him significant rewards. The previously unreported news about SpaceX employees taking on government roles suggests that Musk aims to leverage his influence by filling potential positions in the Trump administration with his confidants.

Given SpaceX's extensive government contracts, Musk's potential government role could raise concerns about conflicts of interest. Musk himself and executives from SpaceX and Tesla did not respond to requests for comment, and a spokesperson for the Trump transition team also declined to comment.

Musk's six companies have close ties to federal agencies, earning massive profits through contracts for rocket launches, satellite construction, and space-based communication services. Tesla has earned hundreds of millions in profits through carbon credits. Musk's companies are also facing at least 20 investigations, including one that concerns Tesla's self-driving technology.

Now, Musk will have the president's support, and Trump has promised to make Musk the head of a government efficiency council, potentially giving him oversight over these agencies. Trump stated that he wanted Musk to bring the same reforms he implemented at Twitter, now X, to the federal government. Musk has also mentioned plans to cut the federal budget by at least $2 trillion. This could weaken or eliminate the current constraints on Musk within the government.

"All the cumbersome enforcement procedures would be gone," said Stephen Myrow, managing partner at Beacon Policy Advisors. Economist Hal Singer said Tesla and SpaceX could face less scrutiny from the Department of Justice. "Trump's Justice Department is unlikely to go after Musk," he said. "Dont investigate your friends, investigate your enemies that's what we saw during the first Trump administration."

A Change in Stance During the campaign, Trump explicitly stated that Musk's support had changed his views. Trump, who once opposed government pushes for electric vehicles, now supports them. "I'm for electric vehicles," Trump said in August, "because Elons been a big supporter of me." Trump also stated he would use executive power to help Musk. "We have to make it better for our smart people," Trump said during a rally in Michigan. "Hes the smartest one out there."

According to Forbes, Musk's wealth increased by $20 billion after the election, reaching a net worth of $285 billion as Tesla's stock soared. Tesla benefits from a $7,500 electric vehicle tax credit, which helps lower the cost of its cars. Last year, the company earned $1.79 billion in revenue from selling carbon credits, according to its annual report. These credits are mainly sold to car manufacturers who haven't met federal emissions limits, as well as to companies in the EU, California, and China.

Economists and regulatory lawyers pointed out that adjustments to tax credit policies and federal emissions standards for new vehicles could impact Tesla's earnings, though General Motors and Ford rely more heavily on these credits.

Musk has a tense relationship with Biden. In 2021, Musk was unhappy when Biden invited all major car manufacturers to an electric vehicle summit but excluded Tesla.

Of Musk's companies, SpaceX has the deepest ties to the government. Last year, SpaceX secured $3 billion in new federal contracts, bringing the total amount to around $11 billion over five years. However, Musk is still seeking more. Allies of Musk in Congress and at the Federal Communications Commission (FCC) have challenged the FCC's decision to rescind a $856 million subsidy to SpaceX, which was supposed to help bring broadband internet service to rural areas of the US.

Brendan Carr, a Republican FCC member, has been vocal in his support of Musk and SpaceX on social media in recent months, even intervening in Musk's dispute with the Brazilian government over social media platform X, though it was not within his purview. Republican members of the US House of Representatives have launched investigations into the FCC's stance on the matter, indicating the decision could be revisited if Republicans control the FCC. This possibility has significantly increased with Trump's victory.

Lunar Mission Fatigue The sheer volume of contracts SpaceX has with the Department of Defense has led Pentagon officials to worry about overreliance on Musk's company for rocket launches. "Having a good friend in the White House could be good for Tesla and SpaceX," said Scott Amey, general counsel for the watchdog group, the Project on Government Oversight, warning that "when relationships get too close, decision-making can be unfavorable to taxpayers."

Musk could push NASA toward his long-held obsession with colonizing Mars instead of continuing the current lunar return program. Trump publicly supported this plan, stating "Hey, weve been to the moon, it's not that exciting anymore." Currently, NASA is planning to dedicate $93 billion to the Artemis lunar mission from 2012 to 2025. There are calls for a re-evaluation of the project, including two lunar missions contracted to SpaceX worth $4.4 billion.

One of Musk's efforts is to place his confidants within the Department of Defense. Sources revealed that Musk has recommended two SpaceX executives: retired Air Force General Terrence J. OShaughnessy and government affairs executive Tim Hughes, both close advisors to Musk.

Musk's role in Trump's re-election campaign could resemble what Peter Thiel did for Trump eight years ago. Thiel supported the transition team and recommended several key figures to the government. Musk could have a similar opportunity. He has already met with Howard Lutnick, the head of the Trump transition team. Some of his political allies, such as tech investors David Sacks, Joe Lonsdale, and Ken Howery, have publicly or privately expressed their willingness to support the Trump administration.

Musk's efforts to secure a second term for Trump are likely to yield rewards. The specifics of these rewards will become clearer in the coming weeks and months.

"Musk was going to do well no matter what, but hes going to do much better under Trump," said Myrow. "That investment might just be worth it."