It would have been hard to miss the news this month of the spat between President Trump and Elon Musk. It “escalated quickly”, as the kids say, with Elon accusing Trump of hiding his associations with Jeffrey Epstein and Trump floating the possibility of cutting off Musk’s federal contracts. The dust-up ended with Musk returning, tail between his legs, to say that he was sorry.
This is the second time that Musk has been reminded that the forces of MAGA have more political heft than the Silicon Valley tech bros. The last time the MAGA-hammer came down on Elon, it was to remind him that Trump supporters voted against increased immigration after the Tesla boss pushed for the issuance of more H1B visas to foreign workers in the technology sector.
This is the second time that Musk has been reminded that the forces of MAGA have more political heft than the Silicon Valley tech bros.Credit: Getty Images
This new conflict has reignited the debates between MAGA populism and Silicon Valley libertarianism. While the dispute around H1B visas may have been clear-cut – the Trump ticket does not support policies like this – the issues that led to the recent clash are far less so. Musk was raising concerns around government spending that are becoming more relevant by the day.
At the centre of the dispute was the so-called “Big Beautiful Bill”, a large piece of tax and spending legislation making its way through Congress.
Musk, who has spent the last few months hacking away at government spending through the Department of Government Efficiency (DOGE), called the bill a “disgusting abomination”.
Unlike the printing of more H1B visas, Musk and his DOGE programme were certainly on the ballot when Americans voted for Trump as president. In a speech to the Economic Club of New York in September 2024, then-candidate Trump announced that he would create a government efficiency commission that would undertake a “complete financial and performance audit of the entire federal government” and propose “drastic reforms.”
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Beyond this, however, the issue of government borrowing is now an acute one. Just last month chief executive of JP Morgan Chase Jamie Dimon warned that mounting debts might “crack” the US Treasury market, which prompted US treasury secretary Scott Bessent to insist that the United States is “never going to default”.
In April, The New York Times ran a shocking headline: “Sell-off in US Bonds and Dollar Raises Questions About ‘Safe Haven’ Status”. In times past, major American newspapers would be cautious about playing politics with the American financial markets. But the pressures are becoming too obvious to ignore.
