- Elon Musk has gone all in on supporting former President Donald Trump for reelection.
- Musk may achieve affect on the federal stage if Trump is elected president.
The stakes are excessive for Elon Musk and his enterprise empire this election season.
Since saying his endorsement of former President Donald Trump in July, the billionaire has persistently used X to voice his assist for the Republican Party and has taken the stage with Trump throughout at the least two rallies.
He’s hosted his personal collection of political “talks” and invested greater than $130 million in pro-Trump efforts this yr. He’s additionally dedicated to a every day $1 million giveaway to swing-state registered voters who signal his petition in assist of free speech and the best to bear arms.
Musk’s actions beg the query: What does the billionaire stand to realize from a Trump presidency?
Potentially, lots.
Musk below Trump
Many of Musk’s corporations rely largely on federal approvals, rules, subsidies, or contracts — and Trump has promised a lighter regulatory surroundings with plans to decrease company and private taxes.
If Trump secures the presidency, University of California Berkeley enterprise and public coverage professor Francesco Trebbi advised Business Insider that Musk may benefit from “putting in key personnel inside the public administration.” This may safe him invaluable connections that reach past the subsequent 4 years, he stated.
Trump has already included a few of Musk’s coverage proposals into his marketing campaign, with plans to determine a authorities effectivity fee led by Musk. Trump has stated the fee would conduct a “full monetary and efficiency audit of the whole federal authorities” and make solutions for “drastic reforms.”
Musk proposed firing a variety of federal employees at a Pennsylvania city corridor on October 18.
“What the hell do you want 428 businesses for,” Musk just lately stated at a rally in Pittsburgh. “Like why do you even want 100?”
Erik Gordon, space chair of entrepreneurial research on the University of Michigan’s Ross School of Business, stated a Trump presidency may additionally end in much less regulator scrutiny. That may give Musk “extra freedom to develop superior applied sciences — one in all his favourite issues to do,” Gordon stated.
Tesla is at a pivotal second, with buyers eyeing Musk’s pledge to safe approval for absolutely autonomous automobiles in Texas and California. However, ongoing investigations into Tesla’s self-driving expertise by authorities businesses, together with the National Highway Traffic Safety Administration, may set again the corporate’s autonomous plans.
During a latest earnings name, Musk urged that if there have been a authorities effectivity fee, he would assist push the state-by-state approval course of ahead with a “federal approval course of for autonomous automobiles.”
For SpaceX, Trebbi stated a Trump presidency might assist the corporate procure massive contracts with the Department of Defense. That may assist it preserve its edge in opposition to rivals like Blue Origin.
Musk below Harris
While Musk may achieve energy, authorities contracts, and looser rules below Trump, it is unclear how he could be impacted below a Harris administration.
A key coverage on the minds of many enterprise leaders is Harris’ proposed tax plan. She goals to lift the company tax charge from 21% to twenty-eight% — a transfer that Bank of America estimates may lower earnings by 5%. That, mixed with the opportunity of stricter rules, may affect a variety of corporations, together with these of Musk.
Gordon stated Harris may introduce new security rules or enact tax credit for EVs or AVs that favor rivals.
For X, which Musk has branded because the platform for freedom of speech, Gordon stated a Harris administration may strain it to ban materials labeled as “misinformation.” However, Gordon stated X would probably win in courts below the First Amendment.
Tevi Troy, a senior fellow on the Bipartisan Policy Center, stated it is unlikely — and probably unlawful— that Harris would ship orders to focus on Musk. However, it is doable that Musk might expertise “selective enforcement,” Troy, who can also be a former senior White House aide, stated.
“One would hope that governmental models can be proof against political pressures,” Joan MacLeod Heminway, a legislation professor on the University of Tennessee, advised BI. “But individuals in these models are people and should inadvertently scrutinize proposals coming from entities owned or managed by Elon Musk.”
It’s additionally doable nothing would meaningfully change for Musk below a Harris administration.
“We have no robust indication that Harris desires to significantly develop the regulatory burdens,” Cary Coglianese, University of Pennsylvania legislation professor and director of the Penn Program on Regulation, advised Business Insider.
Tom Narayan, an analyst at RBC Capital Markets, stated a Democratic Administration may very well be higher for Musk as a result of Harris helps the Inflation Reduction Act and producing in Mexico, which Trump has spoken out in opposition to.
The IRA offers substantial advantages to Musk, together with a $7,500 tax credit score for brand new EVs, which aids Tesla. It additionally affords tax credit for photo voltaic installations.
Karoline Leavitt, the Trump marketing campaign’s nationwide press secretary, advised BI that if elected, President Trump will assist the auto business, “permitting area for each gas-powered vehicles AND electrical automobiles.” However, he plans to terminate the Green New Deal and rescind unspent funds from the Inflation Reduction Act in an effort to “quickly defeat inflation and convey down all costs,” Leavitt stated.
Musk is taking part in a dangerous sport
Given Musk has stated he is supported Democrats up to now, Trebbi stated he could also be aligning himself with Trump to safe authorities assist.
“I see Musk’s realignment with the Republican Party as a danger hedging technique, designed to preempt authorities regulation/keep authorities assist regardless of who wins in November,” Trebbi stated.
Coglianese additionally stated its doable Musk sees himself because the one who can “flip across the federal authorities,” very similar to his strategy to buying Twitter.
“It’s additionally completely conceivable that he simply sees himself as somebody who generally is a savior,” Coglianese stated.
Coglianese stated the technique to align himself with Trump is dangerous although.
“He’s banking on a president who will need to or be keen to repay Musk for his loyalty,” Coglianese stated, including that it is not all the time clear that even his strongest supporters get all the pieces they need.
Carl Icahn secured some EPA reduction whereas advising Trump throughout his first time period, however his tenure resulted in controversy, Coglianese stated. The billionaire investor resigned from his unpaid function amid criticism over potential conflicts of curiosity.
Other circumstances have ended extra favorably. Trump beforehand stated that Tim Cook was the one CEO who known as him straight when he had an issue. The Apple CEO secured an iPhone tariff exemption with the previous President.
“There are moral guidelines mandating compliance with varied kinds of obligations, together with conflict-of-interest reporting, for sure kinds of authorities positions,” Heminway stated. “Elon Musk might not need to tackle these obligations.”
