Donald Trump wants to empower Elon Musk to cut waste from the federal government. What could possibly go wrong?
NASA is the largest customer for Musk’s rocket-ship company, SpaceX. The National Highway Traffic Safety Administration regulates an often contentious and dismissive Tesla, Musk’s electric-vehicle company. The Federal Trade Commission keeps watch over Twitter, which Musk bought and renamed X. The Food and Drug Administration plays a critical role in deciding whether Musk’s start-up Neuralink can implant computer chips in the brains of paralyzed humans. (Note to conspiracy theorists concerned that Anthony S. Fauci and Bill Gates wanted to inject chips into people’s heads: They didn’t. Musk does.)
This is just a partial list. But it gets to a central irony of Trump wanting Musk’s help running the government. A real estate developer turned TV personality, Trump long benefited from tax loopholes and the generosity of the federal bankruptcy code to build and protect his debt-fueled fortune. But he was a piker compared with Musk. The tech entrepreneur joins a long line of Silicon Valley pseudo libertarians who kvetch about the government — while assiduously accepting its handouts.
From subsidies for EVs at Tesla and solar panels at SolarCity (now part of Tesla) to massive contracts at NASA, Musk effectively hasn’t run a business that didn’t benefit from or work with various government entities — often while trashing them in the process. The very notion of Musk scrutinizing the Securities and Exchange Commission, for example, is absurd, given his long-running battles with the agency over his unwillingness to follow its most basic rules.
The idea of Musk taking a machete to government operations likely excites the anti-regulatory business crowd. I’d guess, however, that the bankers and venture capitalists who plunged willy-nilly alongside Musk into Twitter might have second thoughts. Musk famously arrived at Twitter’s San Francisco headquarters carrying a sink removed from a bathroom. The message appeared to be that he was going to tear things apart.
He did just that. He cut staff so drastically that critical functions soon didn’t work, and advertisers fled. Today, the deeply indebted social media company has lost 70 percent of its market value and is in constant turmoil. Musk’s flouting of an order from the highest court in Brazil has jeopardized X’s business in Latin America’s biggest economy and has put his Starlink internet service in a pickle, too.
Musk’s misadventures at Twitter-turned-X serve as a valuable metaphor for what a Musk-run efficiency audit, and bloodletting, might look like in the federal government. Indeed, they mirror Trump’s own experiences as a first-time elected official serving as president. At Twitter, Musk took over a company he knew nothing about, though because he was a user he assumed he knew quite a bit, and made a chaotic mess of things. Indeed, his animosity for the people who ran his new toy before him was so severe that he took a sledgehammer to the very soul of the organization. Does any of this sound familiar?
None of this is to suggest that attacking government waste is a bad idea or that Musk is without his merits.
The government obviously could use more than a dose of efficiency. And, over the years, many have tried, with mixed results — from the Grace Commission of the Reagan era to the regulation-snipping efforts of Harvard law professor Cass Sunstein under President Barack Obama. Businesspeople aren’t even remotely the best people to do this, however, because they fundamentally associate organizational effectiveness with profitability. Could the government spend the people’s money more wisely? Absolutely. Is this consistent with a corporation’s approach to maximizing returns on investment? Not always.
Keep in mind, too, that businesses mess up the whole efficiency-seeking process all the time, often aided by management consultants who excel at peddling their services without having had the benefit of running much of anything themselves. Musk, as it happens, has shown himself to be a bad-faith actor when confronted with the need for cost cutting. In a bid to lower costs at Twitter, he initially simply stopped paying rent on its office buildings and declined to make contractual severance payments to the very executives with whom he had negotiated the company’s purchase. This isn’t the type of person we want representing — much less streamlining — our government.
It’s worth emphasizing Musk’s success by way of wishing he keeps his distance from the halls of power. Musk has so thoroughly revolutionized automaking, rocket construction and satellite communications that he already holds outsize control of these and potentially other industries. His power needs to be carefully monitored and possibly checked — not amplified — by government. In this era, industry and government need a cooperative but arms-length relationship.
A hand-in-glove arrangement, or something even cozier, is certain to be a fiasco.
