The craziest part of the relationship between Donald Trump and Elon Musk is not that it fell apart so quickly, but that it came about at all. Since the 1980s, Trump has been running around talking about the beauty of tariffs, whereas Elon Musk and other (often libertarian) tech billionaires are dreaming of a night watchman state (Nachtwächterstaat) offering free trade; incidentally, Nachtwächterstaat is a term coined by the German socialist Ferdinand Lasalle in 1862. In other words, Trump is a protectionist, whereas Musk would like to reduce or even abolish tariffs.
In addition, leading the newly created Department of Government Efficiency (DOGE), Musk wanted to reduce the budget deficit. Although Trump claimed that he wanted to do the same, in reality, the Trump-approved One Big Beautiful Bill Act aka budget proposal, which passed the House of Representatives on May 22, 2025 with the help of Republican lawmakers, would massively increase the deficit in the coming years.
On June 3, 2025 Elon Musk (rightly) blasted the bill as a “disgusting abomination”. Musk was not alone. Already on May 16, the world’s leading rating agency, Moody’s, had downgraded the U.S. debt from Aaa to Aa1, citing rising debt and interest rates as well as the spending bill in the making.
Even before that, on April 8, 2025 Elon Musk had called President Trump’s senior counselor for trade and manufacturing, Peter Navarro, a “moron” and “dumber than a sack of bricks”. Navarro is like Trump a protectionist and firm believer in tariffs.
In addition, at least some within the Trump team hoped to use DOGE to destroy the federal government aka the “deep state” (leaning towards the Democrates in their eyes) rather than reduce the deficit. In any way, Musk’s efforts were never very credible. There are 2.3 million civilian state employees. If DOGE were to lay off a quarter, i.e. some 600,000 workers, without replacing them, the United States would only manage to save 1% of federal spending.
Trump and Musk were an odd couple because of other differences too. Trump used to be a critic of electric cars, until Musk became his financially most important backer in the 2024 presidential and parliamentary races, spending some $275 million in favor of Trump and MAGA House and Senate candidates. Suddenly, Trump warmed up to electric cars.
Back to the Musk-Trump dispute. On June 5, 2025 Elon Musk asked on his social network X: “Is it time to create a new political party in America that actually represents the 80% in the middle?” He even called for the president to be impeached and replaced by Vice President JD Vance.
Aslo on June 5, 2025 Musk wrote on X that, in the 2026 midterm elections, he might support candidates ready to challenge members of Congress who supported the One Big Beautiful Bill Act: “In November next year, we fire all politicians who betrayed the American people.” He added: “Call your Senator, Call your Congressman, Bankrupting America is NOT ok!”. And he coined the Tarantino-style formula: “KILL the BILL.”
In the whole process, Elon Musk forgot to mention that he himself had left the middle ground by supporting Donald Trump, MAGA candidates as well as shady, populist, far-right politicians around the globe, including Germany’s AfD.
Ahead of the February 23, 2025 German parliamentary election, in a 75-minute online discussion on X with the AfD co-leader Alice Weidel, Elon Musk never questioned Weidel’s many baseless claims, including the one that the Nazis were in fact communists. In reality, the Communist Party of Germany (KPD) and Hitler‘s NSDAP were mortal ennemis, fighting each other in Germany’s streets already before Hitler managed to become Germany’s Chancellor on January 30, 1933 appointed by President Hindenburg as leader of a coalition government. After the Reichstag Fire, allegedly a work of the Dutch Communist Marinus van der Lubbe, Hitler pushed through an emergency law, accused the Communists of arson and had thousands of communist functionaries arrested. Later, he managed to push through the Enabling Act (Ermächtigungsgesetz), which ended the first short phase of democracy in Germany aka the Weimar Republic. Among the first victims of Hitler’s dictatorial rule were most of his political ennemies, in particular the Communist Party KPD.
In short: Elon Musk is like Donald Trump, JD Vance, Steve Bannon, Peter Thiel and others a supporter of far-right ideas and movements in the United States and around the globe. For him to claim the middle ground is not credible, to put it mildly.
The Musk-Trump dispute went very far. On X, Musk claimed on June 5, 2025 that Trump had not released the Epstein files because of Trump’s connection to the late, notorious sex offender and child abuser: “Time to drop the really big bomb: @realDonaldTrump is in the Epstein files. That is why they have not been made public. Have a nice day, DJT!”
However, in this case, one has to stress that there is no evidence that Trump was ever involved in Epstein’s child molestation cases. The two man partied together, Trump took at least seven times Epstein’s private jet, but the two later had a falling out. Trump is not known to have a fondness for teenagers, and there is no evidence evidence that Trump visited Epstein’s notorious private island where Epstein sex trafficked underage girls. Nevertheless, asked about the release of the full Epstein files, Trump was somewhat evasive, leaving an open door to speculation that he might have something to hide.
Jeffrey Epstein died in 2019 in a prison cell. The conclusion was suicide. That night, prison wards had not checked him every 30 minutes as requested and two cameras in front of his cell malfunctioned, leaving Epstein’s death open to conspiracy theories. Normally, it’s the Trump camp who likes to spread conspiracy theories. This time, Trump could be a victim of one.
Back to the economic rift between Musk and Trump. The president seems to dream of replacing income tax in part or in full with customs duties. In several ways, Trump’s role model is president William McKinley (1897-1901), who not only raised tariffs, but also pursued an imperial agenda, successfully leading the U.S. in the Spanish–American War, annexing Puerto Rico, Guam, the Philippines and Hawaii, as I noted in April in the article Trump’s tariffs and trade war will backfire. There is a parallel to Trump’s desire to buy or annex Greenland, Panama and other countries and territories.
It is astonishing that Donald Trump has no understanding of international trade, supply chains and division of labor. All sides lose in a tariff war. But Donald Trump sees trade as a win-lose situation. With his multinational companies, Musk is one of the main victims of a customs war.
Trump and Musk have each other by the balls. On May 30, 2025 just days before his confirmation to his role as the next NASA administrator, Trump said that he planned to withdraw his nomination of Jared Isaacman, a billionaire, entrepreneur and Musk confidant. One explanation is that Trump wanted to punish Musk, another that Trump was told that Isaacman had donated money to prominent Democrats. The two explanations do not exclude each other. Both can be true.
Their alliance does not make sense for Musk insofar as Trump is a protectionist whereas for the owner of Tesla and other multinational companies, free trade would be best. Because of Musk’s alliance with Trump and right wing movements around the world, Tesla has lost many customers. If the fight with Trump continues, Musk cannot win new right-leaning buyers of his electric cars, which will be difficult anyway. Tesla was already suffering declines in market share, sales and profit before Trump came back to power.
They both could inflict serious pain on each other and need each other. According to a report by The Washington Post, in recent years, Musk’s companies such as Tesla and SpaceX benefitted from at least $38 billion in government contracts from way over a dozen federal agencies as well as subsidies (e.g. for battery factories and lithium refineries), loans and tax credits (e.g. for electric cars). The New York Times mentioned that, in the past, Tesla could sell clean air credits to other carmakers that failed to meet environmental standards. During the first quarter of 2025, Tesla sold regulatory credits worth $595 million, which was more than the company’s net profit of $409 million. Trump could tighten regulation for Musk’s companies, for his plan for driverless taxis, offer government contracts to Musk’s rivals such as Blue Origin, etc.
On his social network Truth Social, President Trump had posted: “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.”
Stephen Bannon, presidential advisor at the beginning of Trump’s first term, said that the administration should end Musk’s contracts with the government and he added: “They should initiate a formal investigation of his immigration status, because I am of the strong belief that he is an illegal alien, and he should be deported from the country immediately.”
The reality is more complicated. Trump needs Musk’s deep pockets in the midterm elections. And the Pentagon and NASA depend on Musk’s Starlink and SpaceX, to mention just two dependencies. To put it bluntly: Trump and Musk, they have each other by the balls.
On X on June 11, 2025 Musk tried to make amends with Trump: «I regret some of my posts about President @realDonaldTrump last week. They went too far.» Musk may be the world’s richest man, but Trump is the politically most powerful man, a position Musk can never reach because he was not born in the United States.
Donald Trump has already moved to another fight: Trump vs. California. Trump’s tariff war may be unpopular with voters, but a majority of 54% (CBS News/YouGov poll taken before the escalation) agrees with a tougher immigration policy.
Trump’s administration managed to substantially curb illegal immigration at the border, but the deportation of illegal immigrants on U.S. territory proceeds slowly. Trump and his willing executioners had originally announced that they would deport millions. They are in the process of toughening their stance, obviously in a Democratic governed state such as California, which depends heavily on immigrant workers, some of whom are illegals. This brutal policy led to protests.
In a speech in Fort Bragg on June 10, 2025 President Trump said: «Very simply, we will liberate Los Angeles and make it free, clean, and safe again. It’s happening very quickly.» … Trump called protesters in Los Angeles “animals” and “a foreign enemy”.
The Democratic California Governor Gavin Newsom is pushing back. He said on June 10, 2025 that “Democracy is under assault before our eyes.” The Democratic Senator Adam Schiff rightly stated in an interview: “The president would like nothing better than to create a conflict in L.A. to demonstrate his strongman credentials by then cracking down on the chaos.”
This is true. President Trump and some of his advisors such as Stephen Miller, who in May had floated the idea to suspend habeas corpus, seem to hope for an escalation. They put oil into the fire to be able to present themselves as the ones representing law and order. The most sinister prediction is that the far-right wing hopes that the situation will get out of control to the point that, in the chaos, authoritarian rule can be established. We are not there yet. When Trump lost the election after one term in office, he initially refused to resign and incited his supporters to storm the Capitol.
At the same time, Governor Gavin Newsom probably wants to raise his profile in order to position himself for 2028. Protesters burning cars and waving Mexican flags offer Trump and his administration arguments for a crackdown. On June 9, 2025 the Democratic Senator John Fetterman said: “My party loses the moral high ground when we refuse to condemn setting cars on fire, destroying buildings, and assaulting law enforcement.” True. But Trump remains the arsonist. He talks and writes about an “insurrection”, sends National Guard troops and Marines to California although Governor Newsom had not asked for it. Trump remains a threat to democracy, both in the United States and around the globe.
At the same time, Trump’s supporters remain partly divided. Evangelicals care about abortion. Bannon, JD Vance and others want to curb immigration, are in favor of tariffs and other forms of protectionism, want to bring back industries, care about white men, oppose wokeness and LGBT+ rights, etc. Musk, Thiel and others are libertarians. They want free trade, minimal or no regulations. They hope to cut back or even eliminate federal agencies, even the state as such. Some ideas are compatible with each other. Others aren’t. Like Putin, Trump would like to rule as an autocrat and enrich himself and his family. And he has a few obsessions aka idées fixes such as tariffs and the wall.
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Donald Trump vs. Lady Liberty. Photograph from the 2017 German carnival of a carnival float made by Jacques Tilly. Photograph © Jacques Tilly.
Article added on June 12, 2025. Added at 13:12 German time. July 7, 2025: word order in one sentence changed for clarification.
