Trump vs. Musk: A Billion-Dollar Feud Threatens Tesla and SpaceX’s Federal Lifeline

Category: News & Politics
Subcategory: U.S. News & Politics
Website: Boncopia.com

In a dramatic escalation of a once-unlikely rift, President Donald Trump has threatened to cut off billions in federal subsidies and contracts that have fueled Elon Musk’s business empire, including Tesla and SpaceX. What began as a public spat over Trump’s “big, beautiful” budget bill has spiraled into a high-stakes showdown, with the President accusing Musk of disloyalty and Musk firing back with threats to decommission critical space assets. The feud, playing out on Truth Social and X, has sent Tesla’s stock plummeting 14% and raised questions about the future of Musk’s companies, which rely heavily on government support. House Minority Leader Hakeem Jeffries, seizing the moment, has called Musk’s critiques of the bill “the stone-cold reality,” amplifying the chaos within the Republican ranks. Here’s how this explosive clash could reshape the political and economic landscape.

The Roots of the Rift

The Trump-Musk alliance was once a cornerstone of the President’s second term. Musk, the world’s richest man, poured nearly $300 million into Trump’s 2024 campaign and served as a key advisor, leading the Department of Government Efficiency (DOGE) to slash federal spending. Their bromance was on full display in March 2025, when Trump showcased a red Tesla Model S at the White House, a nod to Musk after boycotts targeted Tesla over his DOGE role. But cracks emerged as Musk criticized Trump’s signature budget bill, the One Big Beautiful Bill Act, calling it a “disgusting abomination” for its deficit-bloating $2.4 trillion price tag, as projected by the Congressional Budget Office.

Trump, stung by the betrayal, lashed out on June 5, 2025, via Truth Social: “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!” The President claimed Musk’s ire stemmed from the bill’s elimination of electric vehicle (EV) tax credits, accusing him of going “CRAZY” over lost subsidies. Musk denied this, insisting his criticism focused on the bill’s “mountain of disgusting pork” and urging Republicans to cut wasteful spending to avoid national bankruptcy.

The Stakes: Billions on the Line

Musk’s companies are deeply entwined with federal funding, making Trump’s threat a potential body blow. SpaceX, a linchpin of NASA and Pentagon operations, has secured over $38 billion in government contracts, loans, subsidies, and tax credits over two decades, with $3.8 billion in 2024 alone. These include $2.89 billion from NASA for lunar lander development and billions for ferrying astronauts to the International Space Station (ISS) via SpaceX’s Dragon spacecraft. Tesla, while less reliant on direct grants, has reaped $11.4 billion from regulatory credits and state incentives, boosting its bottom line.

Trump’s threat to sever these lifelines sent shockwaves through Wall Street. Tesla’s stock plunged 14.3% on June 5, wiping out $151 billion in market value, as investors feared the loss of federal support. SpaceX, though privately held, faces risks to its dominance in government contracts, especially as competitors like Boeing and Lockheed Martin could gain ground if SpaceX’s funding is cut. Musk’s counter-threat to decommission the Dragon spacecraft—a critical U.S. asset for ISS missions—escalated the stakes, potentially forcing NASA to rely on Russia for space access.

Jeffries Piles On

House Minority Leader Hakeem Jeffries (D-NY) wasted no time capitalizing on the feud. In a June 4, 2025, CBS News interview, Jeffries endorsed Musk’s critique of the budget bill, calling it “the stone-cold reality.” He framed the GOP’s internal strife as a “Republican civil war,” spotlighting divisions between Trump loyalists and fiscal conservatives like Musk. Jeffries’ alignment with Musk is a savvy move, using the billionaire’s clout to underscore GOP dysfunction while positioning Democrats as fiscal watchdogs—a narrative shift after years of Republican criticism over Democratic spending.

Jeffries’ comments amplify the political fallout. By echoing Musk, he keeps the focus on the bill’s $2.4 trillion deficit impact, which nonpartisan analysts warn could balloon to $5 trillion. This gives Democrats ammunition to paint Republicans as fiscally reckless, potentially swaying independents ahead of the 2026 midterms.

Musk’s Power Play

Musk’s response to Trump’s threat was characteristically bold. On X, he denied Trump’s claim that he was upset over EV subsidy cuts, stating, “Keep the EV/solar incentive cuts in the bill… but ditch the MOUNTAIN of DISGUSTING PORK.” He escalated further, announcing that SpaceX would begin decommissioning its Dragon spacecraft, a move that could cripple U.S. space operations. Musk also took personal shots, accusing Trump of lying and even suggesting impeachment over unproven claims tied to Jeffrey Epstein.

This public jousting reveals Musk’s dual role as both a business titan and a political pugilist. His $300 million investment in Trump’s campaign gave him leverage, which he wielded by claiming, “Without me, Trump would have lost the election.” Yet, his departure from DOGE last week and his attacks on the bill signal a shift. Musk’s focus on fiscal discipline aligns with his DOGE mission, but his willingness to burn bridges with Trump suggests he’s prioritizing his companies’ long-term interests over political loyalty.

GOP Fractures Deepen

The Trump-Musk feud exposes deeper rifts within the Republican Party. Fiscal conservatives, emboldened by Musk’s stance, are pushing back against the budget bill’s cost. Posts on X show growing unease, with users like@vanguardintel noting Musk’s call to “kill the bill” for its deficit impact. Meanwhile, Trump loyalists defend the bill’s tax cuts and spending as necessary for economic growth, echoing the President’s claim that Musk’s criticism is self-serving.

Some Republicans, like Rep. Thomas Massie (R-KY), downplay Trump’s threat, arguing that canceling SpaceX contracts would be “ridiculous” given its critical role in U.S. space access. But the Senate, where the bill faces scrutiny, may see increased resistance from fiscal hawks, potentially stalling Trump’s agenda. The feud also risks alienating Musk’s supporters, a key demographic in Trump’s base, who view him as a champion of innovation.

Economic and Political Fallout

The economic implications are stark. Tesla’s stock plunge reflects investor fears that losing federal support could hobble its growth, especially as global sales falter amid backlash to Musk’s political ties. SpaceX’s contracts, including potential roles in Trump’s “Golden Dome” missile defense plan, are at risk, which could shift billions to rivals like Blue Origin.

Politically, the feud weakens Trump’s grip on the GOP. Musk’s exit from DOGE and his public attacks undermine Trump’s narrative of unity, while Jeffries’ gleeful commentary keeps the spotlight on Republican chaos. The bill’s fate in the Senate hangs in the balance, with Musk’s influence potentially swaying key votes. If the bill fails, it could dent Trump’s momentum, but if it passes, the deficit spike could haunt Republicans in 2026.

What’s Next?

The Trump-Musk clash is far from over. Musk’s threat to decommission Dragon could force NASA to scramble, while Trump’s subsidy cuts could reshape the space and EV industries. The Senate’s handling of the budget bill will be a critical test, with Musk urging Republicans to strip out “pork” and Trump doubling down on his vision. Jeffries, meanwhile, will likely keep fanning the flames, using the feud to rally Democratic opposition.

This saga underscores the fragility of political alliances built on mutual convenience. As Musk and Trump trade barbs, the fallout could ripple through markets, space exploration, and the GOP’s future. For now, the world watches as two titans clash over billions—and the direction of America’s economy.

Thought-Provoking Questions

1. Will Trump follow through on his threat to cut Musk’s subsidies, or is it a bluff to rein in his former ally?

2. How might Musk’s decision to decommission SpaceX’s Dragon spacecraft impact U.S. space policy and national security?

3. Can Hakeem Jeffries and Democrats leverage the Trump-Musk feud to gain political ground, or will it backfire by alienating pro-Musk voters?