Elon Musk has sharply criticized the fiscal and budget proposal championed by President Donald Trump, currently under Senate review. The tech tycoon cautioned that the latest draft of this legislation, dubbed the "great and beautiful bill," is poised to destroy millions of jobs across the United States, causing "significant strategic harm to the nation."
Musk expressed on X that the bill favors outdated industries at the expense of emerging ones, sharing insights from Jesse Jenkins, an energy expert at Princeton University. Jenkins warned that the proposal would escalate energy costs, eliminate massive investments in energy and manufacturing, increase pollution, and hinder competition with China in artificial intelligence. "Absolutely insane and destructive," Musk declared.
Musk's statements echo warnings he issued in early June, when he labeled Trump's plan a "disgusting abomination" and deemed its approval in the House of Representatives on May 22 a "monumental mistake." The Senate recently agreed to formally debate the controversial budget, which includes extending tax cuts from Trump's first term, boosting military spending, and tightening immigration controls. These moves are accompanied by cuts to social programs like Medicaid and food stamps.
The nonpartisan Congressional Budget Office projects that the legislation would increase national debt by $2.4 trillion over the next decade. Trump aims to have the bill signed by July 4, Independence Day, as a significant political victory ahead of the 2026 midterm elections.
Background: A Political Rift Between Former Allies
Musk's criticism marks the latest in a series of public disagreements with Trump, once one of his key allies. Their strategic relationship, previously marked by collaboration and mutual support, has quickly deteriorated in recent weeks. The turning point came with Musk's departure from the Department of Government Efficiency (DOGE), an office established by Trump.
Although Musk's exit was officially labeled as the end of a temporary contract, tensions surfaced when he described Trump's new fiscal plan as a "disgusting abomination," asserting it undermined his efficiency achievements. In response, Trump took to Truth Social to dismiss Musk, stating he "went crazy" after losing the electric vehicle mandate, and threatened to cancel federal contracts with Musk's companies, including Tesla and SpaceX. Trump even claimed he personally requested Musk's removal from government involvement.
The situation escalated when Musk called for Trump's impeachment, arguing that a government driven by personal vendettas is untenable. Musk also hinted at Trump's connections to the Epstein scandal, an allegation he later retracted, but maintained that "the truth will come out." Trump dismissed these claims as "old news" and labeled Musk as "disrespectful."
The conflict has had economic repercussions. Tesla's stock plummeted over 8% in a single day amid market jitters over potential loss of contracts and subsidies. Musk asserted that without his financial and media backing, Trump would have lost the 2024 election. He highlighted his $250 million donation to Trump’s campaign but clarified that he will only support candidates who uphold "sound economic principles" in the future, not partisan loyalties.
In retaliation, Trump warned Musk of "serious consequences" if he supports Democratic candidates in the 2026 legislative elections. Amidst this clash, Senate President JD Vance attempted to de-escalate the conflict, describing Musk as an "emotional guy" and suggesting the tension might subside. However, the rift between the two wealthy figures appears irreparable, transforming their once-celebrated alliance into an open battle with profound political, economic, and technological implications for the country.
Key Questions Surrounding Musk and Trump's Conflict
What are the potential economic impacts of Trump's proposed budget plan?
The plan could increase energy costs, eliminate significant investments in energy and manufacturing, and increase national debt by $2.4 trillion over the next decade, potentially affecting job markets and economic stability.
How has the relationship between Elon Musk and Donald Trump changed recently?
Their relationship has deteriorated from strategic collaboration to public confrontation, marked by Musk's criticism of Trump's fiscal policies and calls for impeachment, and Trump's retaliatory threats against Musk's businesses.
What are the broader implications of the Musk-Trump feud?
The feud has political, economic, and technological implications, potentially affecting markets, government policy, and international competition, particularly in sectors like renewable energy and artificial intelligence.