Elon Musk made some big promises during former President Donald Trump’s campaign. But his business track record casts doubt on whether he can deliver.
Mr. Musk and Mr. Trump have publicly discussed having the Tesla and SpaceX CEOs serve in some government role if Mr. Trump is elected president. Musk and Trump have not provided details, but Musk jokingly talked about his potential job heading up the Department of Government Efficiency (DOGE, the name of Musk’s favorite meme and cryptocurrency). It is mentioned that this is the case. President Trump appeared on Fox News last week and said that Musk could become the Secretary of Cost Reduction, a government agency that also does not currently exist.
If Musk were to lead any task force, he said during his campaign and in his Aug. 10 interview with President Trump that he would make significant cuts to cut wasteful spending that does not benefit the American people. It promises to make recommendations and will likely use AI to decide where to spend. cut. He also said he would propose a wholesale rollback of government regulations that he has long complained about. Mr. Musk has promised to be kind, offering generous severance packages to laid-off government workers and introducing an evaluation system that threatens redundant employees with dismissal.
These are all tactics Musk has employed or promised in his own business. His track record is mixed. Mr. Musk did not respond to requests for comment.
Huge layoffs: President Trump praised the CEO for being ruthless on layoffs in an interview with Musk in August and a subsequent public discussion about Musk’s potential government role. The UAW autoworkers union filed labor charges against Musk in August after President Trump called him a “cutter” and threatened to fire striking autoworkers. Trump then announced plans for Musk’s role in September, saying Musk would propose “fundamental reforms.”
“The first step is to drastically reduce spending,” Musk said Sunday at Pittsburgh’s City Hall, discussing what could be done for the government. ” he said. “Let’s start from zero.”
But job cuts haven’t always worked out well for Musk’s company.
At Company X, Mr. Musk made significant cuts, cutting approximately 80% of the workforce. That has led to janky and unstable products, as evidenced by the disastrous technical failures of Florida Gov. Ron DeSantis in 2023 and Trump a few months ago. Mr. Musk also eliminated Company X’s trust and safety team, leading to an escalation of hate speech and unchecked misinformation and the exodus of advertisers from the platform.
According to Fidelity, X is worth 80% less than what Musk bought it for in October 2022.
Read Goldman’s full analysis here.
