Tesla CEO Elon Musk, A Role In A Trump Administration, & A Conflict Of Interest
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As part of his 2024 quest to return to the executive office, former President Donald J. Trump has entertained the idea of bringing Tesla CEO Elon Musk into his administration. Musk would reportedly be part of a commission of notable business executives who’d study government fiscal accounts, with the goal to identify thousands of programs that could be decimated.
Musk’s name has been at the top of such a list ever since he endorsed Trump’s candidacy in July. Their bro’ boys chat on X last month, which was less an interview than a streamed mutual admiration session, escalated the gossip about Musk’s potential place in a Trump administration.
Trump and Musk would both benefit from such a US government post. Trump, who loves the celebrity life, would gain more boasting power about how the wealthiest in business surround him. Meanwhile, the Tesla CEO, with his other businesses of X, SpaceX, Starlink, Neuralink, The Boring Company, etc., etc., could influence policy and promote his own affairs over the good of the American people.
Trump prides himself on eliminating any policy, program, or department he perceives as wasteful or contrary to his worldview — one need look no farther than how his appointment of Supreme Court judges has limited the power of the EPA and other federal agencies to lower carbon emissions, remove toxic chemicals from the environment, and protect the health and safety of the people of the United States.
We already know that the Trump-aligned Project 2025 initiative would “create a harsher country with higher poverty and less opportunity” while simultaneously delivering more tax cuts to the wealthiest people in the US, as analyzed by the Center on Budget and Policy Priorities.
Speaking on the Shawn Ryan Show, Trump expressed interest in Musk’s ability to “get involved in cutting some of the fat, and he does know how to do it.” Assuring the audience that the South Africa–born Musk “loves the country,” Trump explained that a Cabinet position would probably not be a good fit for Musk “with all the things he’s got going.” Being involved in a Trump administration would mean that Musk would balance “running big businesses and all that,” so Musk “can sort of, as the expression goes, consult with the country and give you some very good ideas.”
The Washington Post outlines another motivation for the suggested Trump–Musk partnership. “Trump’s interest in the commission is partly a response to a political and substantive problem facing his campaign — the GOP presidential nominee’s plans might inflate the national debt. He has pushed several trillions of dollars in additional tax cuts for his second term and proposed nowhere near that amount in new revenue.”
Did you know Biden just cut the deficit by the largest amount in history?
Did you know that 25% of all the national debt ever accrued in American history was added under Trump?
But somehow Republicans only care about the debt when a Democrat is president. pic.twitter.com/dQUdXN8sMN
— Robert Camacho (@robcamacho) February 3, 2023
How Dual Roles in Government & Business Pose a Conflict of Interest
The purpose of the corporation and its primary responsibilities of fiduciary duties, negotiation leverage, and contractual feasibility have all become topics of great concern with the narrow conservative vision that currently envelops the Trump organization. Sometimes referred to as “superstar CEOs,” the duo of Trump and Musk could threaten corporate governance by unduly influencing directors and their ability to faithfully discharge their fiduciary duties.
In 2016, President-elect Donald Trump was informed he should divest himself of his vast business interests in order to avoid conflicts of interest while in the White House, according to a letter from the US Office of Government Ethics. How would Musk — along with his numerous ex-wives and children — separate himself from his business endeavors if he was to be part of the Trump administration?
Restricting CEO power becomes essential in safeguarding corporate governance. But would the Tesla CEO bow to such pressure? If Musk’s recent recalcitrance to terminate X in Brazil per government order is any indication, the answer is a Big Fat No. Musk’s immersion in federal regulatory and finance departments should be considered unethical. It is clearly a conflict of interest; as media studies scholar Agustin Braun notes, corporate leaders should not act as politicians — “they are not subject to the same systems of democratic accountability.”
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Iconic economic Milton Friedman argued, “There is one and only one social responsibility of business — to use its resources and engage in activities designed to increase its profits.” Musk has overstepped such commonly accepted business boundaries through changes to his social platform that are unfavorable both for the journalistic profession and society at large. As a business celebrity, Musk’s role should be to alleviate tensions emerging from contemporary corporate environments — not create them.
Musk & Tesla Have Benefited from US Government Support
Tesla got on its proverbial feet in part due to loans from the US federal government. The company has also increased electric vehicle (EV) sales due to the Inflation Reduction Act (IRA) tax incentives for both new and used electric vehicles. Trump is, overall, against tax credits and incentives, but he isn’t “making any final decisions on” the $7,500 electric vehicle tax credit. That’s the same credit he tried to repeal when he was in office. In his typical wishy-washy way, Trump described himself as “a big fan of electric cars, but I’m a fan of gasoline-propelled cars, and also hybrids and whatever else happens to come along.” At other times he has strongly criticized EVs, including Teslas.
Musk has felt under-appreciated by the Biden–Harris administration, and Trump has taken advantage of that. Although he was originally positioned against EVs, Trump vacillated in the face of Musk’s financial and social media support. “I’m for electric cars,” Trump stated. “I have to be because Elon endorsed me very strongly.”
Trump spoke on the campaign trail at a non-union auto parts manufacturing site while Biden and Harris walked picket lines with union auto workers. Musk has fought unionization at his various companies around the world. Years ago, a judge determined that Musk engaged in union busting at Tesla. More recently, the UAW has filed federal labor charges against what it calls “disgraced billionaires Donald Trump and Elon Musk” due to their illegal attempts to threaten and intimidate workers, whether explicitly or implicitly.
When he was president, Trump had the U.S. Department of Justice sue California over its long-held right to enact stricter vehicle emissions rules than the rest of the country (a right granted when the Clean Air Act was created to ensure California could work harder on cleaning up its air). Tesla, in a filing with the EPA after the 2020 election, urged the Biden administration to allow California to retain that right. Moreover, Tesla lobbied the government for regulations that would ban the production of most new gasoline cars by 2035 – the so-called “EV mandate” that Trump and others on the conservative right have targeted as a threat to the US auto industry.
Tesla has been paid $36 million in federal funds to install at least 328 EV charging plugs, according to policy and data research firm Atlas Public Policy. Tesla sales in China just logged their best month of the year so far in August, and much of Tesla’s success depends on its production and sales in China. Hmm … how would the Tesla CEO influence US charging infrastructure and USA’s relationship with China if he was part of a Trump administration?
SpaceX won a NASA contract in 2021 worth up to $4.4 billion to build a human landing system for the Artemis moon missions. Looking ahead, SpaceX and Starlink would reap financial rewards if refreshed federal contracts came their way.
Musk’s Tendency to Fight Government Sanctions
Needless to say, Musk’s acquisition of Twitter, which he renamed X, has had a profound impact not only on Musk and Twitter but also on Tesla, society, and American politicians’ elections. Musk’s acquisition of Twitter was financed with Tesla stock sales. Financial journalist Matt Levine asked, “Is it consistent with Musk’s fiduciary duties as chief executive officer and controlling shareholder of Tesla Inc. to sell or not sell $20.8 billion worth of stock […] based on the results of a Twitter poll?” Musk clearly had certain intellectual property and political purposes with the acquisition of Twitter, as, working under a freedom of speech mantra, it initially implemented controls on some junk information and bot accounts and then ultimately permitted formerly banned accounts to reopen.
The National Labor Relations Board also determined that a 2018 Twitter post by Musk unlawfully threatened Tesla employees with the loss of stock options if they decide to be represented by a union and suggested he would fire employees engaged in protected coordinated activity, including work stoppages to call attention to their demands.
Tesla has been embroiled in Justice Department and SEC investigations, particularly over its Autopilot and Full Self Driving assistance technologies. The SEC has investigated X, and the National Labor Relations Board is investigating allegations of harassment at SpaceX.
As our CleanTechnica editor, Zachary Shahan, noted, Musk floated the idea that he’d be head of a “Department of Government Efficiency” (DOGE) in an easy-going way. “Naturally, that’s a reference to the Dogecoin cryptocurrency Musk hyped up for years,” Zach explained, “so there is a question of whether this is all a joke.”
Let’s hope it is a joke and that the Tesla CEO flits onto the next idea and doesn’t present a blatant conflict of interest in pursuit of a Trump administration post.
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