Trump targets Musk’s subsidies amid renewed political clash

U.S. President Donald Trump has reignited a simmering feud with Elon Musk, urging a review of the billions in government subsidies granted to the billionaire’s companies. In a Truth Social post, Trump suggested the Department of Government Efficiency (DOGE) investigate the public funding received by Musk’s ventures—implying that cutting those could deliver major savings to the federal budget.

"Elon may get more subsidy than any human being in history," Trump wrote. "Without subsidies, Elon would probably have to close up shop and head back home to South Africa. No more rocket launches, satellites, or electric car production—and our country would save a fortune. Perhaps DOGE should take a good, hard look at this? BIG MONEY TO BE SAVED!!!"

Trump’s comments follow sharp criticism from Musk over the administration’s sweeping tax-and-spending bill. The Tesla and SpaceX CEO blasted the legislation over the weekend, calling it “utterly insane and destructive” and accusing lawmakers of betraying their fiscal promises.

High-stakes rift hits markets

Musk’s remarks triggered waves in Washington and on Wall Street. Tesla shares plummeted by $150 billion in market value on June 5—the steepest one-day drop in the company’s history—after a public breakdown in relations between the two power players. Although the stock has since partially recovered, another 5% dip hit Tesla shares trading in Frankfurt on Tuesday following Trump’s latest comments.

Musk, who previously supported Trump’s re-election campaign and helped lead the administration’s DOGE initiative, has now become one of the bill’s fiercest critics. On X (formerly Twitter), Musk said, “I am literally saying CUT IT ALL. Now,” emphasizing his call to slash all federal subsidies—his own included.

Trump’s bill, which passed with bipartisan support, is projected by nonpartisan analysts to add roughly $3 trillion to the national debt. Musk has framed this as a betrayal by lawmakers who ran on promises of government restraint, saying they should “hang their heads in shame” and pledging to help defeat them in their primaries.

Political fallout and deeper fractures

The clash has broader implications beyond personal rivalry. SpaceX, one of Musk’s most high-profile companies, holds more than $22 billion in government contracts. Its satellite division, Starlink, also benefits from public funding as it expands internet coverage worldwide. Tesla, meanwhile, has long relied on tax incentives to support its EV business.

On Monday, Musk went further, calling for the creation of a new political party to counter what he described as a “one-party country.” Mocking both Democrats and Republicans, he referred to them as the “PORKY PIG PARTY” in a scathing post.

While Musk’s influence in Congress remains uncertain, Republican strategists are growing concerned. A messy public rift between Trump and one of the GOP’s most prominent business allies could fracture conservative support—and complicate efforts to hold onto congressional majorities in the 2026 midterms.

Summary:

President Trump is pressing to review subsidies granted to Elon Musk’s companies, citing cost savings, amid a heated public battle over government spending. Musk, once a close political ally, has turned into a vocal critic of Trump’s tax-and-spending bill and is now calling for a new political movement. The feud has already rattled Tesla investors and exposed deep divides between tech billionaires and traditional political leadership.

FAQs

Q1. Why is President Trump calling for a review of Elon Musk’s subsidies?

President Trump claims that Musk’s companies receive disproportionately large federal subsidies and contracts. He suggests that cutting these could significantly reduce government spending, especially in light of rising national debt concerns following the passage of a major tax-and-spending bill.

Q2. Which of Elon Musk’s companies receive federal support?

Musk’s companies—particularly SpaceX and its satellite division Starlink—hold over $22 billion in U.S. government contracts. Tesla has also benefited from federal tax credits for electric vehicles and clean energy programs.

Q3. What is the Department of Government Efficiency (DOGE)?

DOGE is a cost-cutting initiative that was launched under Trump’s earlier administration to reduce federal waste and inefficiencies. It’s not a traditional agency but rather a symbolic or administrative push toward leaner government spending.

Q4. How has the Trump–Musk feud affected Tesla's stock?

Tesla stock experienced a historic drop on June 5, losing about $150 billion in market value in a single day. This was largely attributed to investor concerns about the political fallout and the potential for policy shifts affecting Musk’s businesses.

Q5. What is Elon Musk’s stance on federal subsidies now?

Musk has taken an anti-subsidy stance, calling to “CUT IT ALL” and advocating for an end to all forms of federal support—including those that benefit his own businesses. His position aligns with broader calls for fiscal conservatism, despite his past reliance on such subsidies.

Q6. How does this political conflict impact the broader business environment?

The feud underscores the growing tension between government policy and tech entrepreneurs. It also reflects uncertainty around long-term support for EVs, space exploration, and federal contracting—key areas where private-sector innovation intersects with public funding.

Q7. Could Musk’s call for a new political party gain traction?

While it's too early to predict the viability of a new party, Musk's rhetoric signals a deeper disillusionment with both Republicans and Democrats. His criticism could influence a segment of the electorate and reshape donor dynamics, particularly among libertarian-leaning tech and business communities.

Q8. What are the possible implications for the 2026 midterm elections?

Musk’s threat to target lawmakers who supported the spending bill may deepen fractures within the GOP. If his base of supporters follows suit, it could disrupt Republican primary races and alter the party’s legislative strategy ahead of the midterms.