As Elon Musk expands his reach, Washington worries

Washington Post photo by Jonathan Newton
SpaceX CEO Elon Musk at the company’s launch facility in Boca Chica, Texas, on Feb. 10, 2022.

Musk, the richest man in the world, then irritated some Pentagon officials by announcing he didn’t want to keep paying for his private satellite service in Ukraine, before later walking back the threat.

As Musk, 51, inserts himself into volatile geopolitical issues, many Washington policymakers worry from the sidelines as he bypasses them.

A two-decade partnership between Musk and the federal government helped the United States return to global dominance in space and shift to electric cars, and made the tech geek an internationally famous CEO. But many in Washington, even as they praise his work in areas of national security, now see Musk as too powerful and too reckless.

Citing Musk’s public ridicule of those who snub him – the billionaire has called President Biden a “damp sock puppet” and said Sen. Elizabeth Warren (D-Mass.) reminds him of “my friend’s angry mom” – many of the two dozen top government officials interviewed for this article would only speak about Musk on the condition of anonymity. But nearly all described him as being as erratic and arrogant as he is brilliant.

“Elon, The Everywhere” is what one White House official called him. “He believes he is such a gift to mankind that he doesn’t need any guardrails, that he knows best.”

“He sees himself as above the presidency,” said Jill Lepore, a Harvard historian who hosted podcasts on Musk.

Musk declined to comment for this story, but he says he weighs in on important problems and described his mission as “enhancing the future of humanity.” He said his Ukraine plan could avert possible nuclear war, and that his Taiwan proposal could ease dangerous regional tensions.

But Musk’s freelance diplomacy is angering allies at the same time he takes over a media platform with hundreds of millions of users.

“The bottom line is that people hang on his every word because he has delivered so many times,” said Sen. Richard J. Durbin (D-Ill.). “I hope he shows some respect for that responsibility.”

Sen. Lindsey O. Graham (R-S.C.) called Musk’s plan for Ukraine an “affront” to its people, and even suggested federal subsidies that help electric carmakers might be better spent.

Musk’s relationship with Washington started out strong. “I love you!” Musk blurted out when a NASA official called to tell him in 2008 that he got a $1.6 billion contract at a time when he was heavily in debt. Washington then poured billions more into Musk’s company as it developed its rockets and space capsule. SpaceX delivered, rebuilding the flagging U.S. space program.

His bipartisan efforts once helped him win over Washington. He dined with President Barack Obama and joined President Donald Trump’s economic councils. He donated to candidates of both parties. Now, he bashes Biden and says he plans to vote for a Republican president in 2024.

These days, the eccentric entrepreneur rarely visits Washington and is increasingly critical of the federal government. He does talk to foreign presidents and prime ministers, according to people who work directly with him. Musk sells his state-of-the-art rockets and aerospace technology to South Korea, Turkey and a growing list of other countries. He has Tesla factories in Germany and China. He also owns and controls more than 3,000 satellites circling the Earth – far more than any nation, including the United States.

In May, Brazilian officials said Musk met with Jair Bolsonaro, the right-wing ultranationalist who lost his bid for reelection as president this week. Musk said he spoke with Russian President Vladimir Putin 18 months ago, but denied a report that he talked to Putin just before offering his Ukrainian peace plan that was widely condemned as pro-Russian.

Though Musk needs Washington less now that he is global powerhouse, Washington continues to depend on him. The U.S. military uses his rockets and satellite communications services for its drones, ships and aircraft. NASA currently has no way to get American astronauts to the International Space Station without his space capsule. And, at a time when climate change is a top White House priority, he has more electric cars on U.S. roads than any other manufacturer.

Several top government officials said they are working on decreasing their reliance on Musk, including partnering with and nurturing competitors with government contracts and subsidies. “There’s not just SpaceX. There are other entities that we can certainly partner with when it comes to providing Ukraine what they need on the battlefield,” Sabrina Singh, deputy Pentagon press secretary, told reporters last week.

A key concern now that Musk has completed his purchase of Twitter is his web of overseas holdings and foreign investors, including his massive Tesla factory in China, and possible leverage others could have over Musk now that he controls a platform where some users have spread misinformation and ratcheted up political divisiveness. As a U.S. defense contractor, Musk has been vetted, but several top officials said they wanted a more thorough review, including any expansion plans in Russia and China. Warren and others have called his Twitter purchase a “danger to democracy.”

Washington has dealt before with powerful tycoons who dominated railroads, oil or a key economic sector, said Richard Haass, president of the Council on Foreign Relations. “But what’s a bit different here is Musk’s ability to project his political agenda and the fact that now that we have technology and media that allows individuals to essentially become their own network or channel,” Haass said.

Because Musk has business investments in China, and, according to Russian and other news reports, said last year at a Kremlin-sponsored event for students that he was planning one in Russia, several top U.S. government officials wonder if Musk’s business interests affect his views on foreign affairs.

The economic turmoil since the Ukraine war began has dented the fortunes of many people including Musk, whose personal wealth dropped by tens of billions, to about $210 billion, according to Bloomberg’s Billionaires Index.

Two people who know him well said Musk is impulsive and that makes him say things that harm his own interests – a tendency that makes it difficult for government officials to count on Musk. Musk himself has said he has Asperger’s syndrome, a form of autism, and no one should expect him to be a “chill, normal dude.”

“He shoots himself in the foot all the time. He should not be getting into politics,” said one person who has worked with him for years.

“I have been as shocked as anyone these last few months at some of the things he has waded into,” said Lori Garver, former deputy administrator at NASA. She worries about the consequences. SpaceX restored U.S. leadership in space, but his politically charged comments attract critics who are starting to ask, “Why is taxpayer money going to this billionaire?”

“It’s disappointing,” she said.

Shifting power

Musk set his sights on D.C. 20 years ago. A South African who moved to Silicon Valley, Musk became a U.S. citizen in 2002 – the year he used his payment from the sale of PayPal, the electronic payment firm he helped found, to start SpaceX. It was a big risk, and he needed high-dollar government contracts to survive. In early 2003, Musk announced he would have a “significant presence” in the nation’s capital so that he could build a “close working relationship with the federal government.”

He invested in Tesla around the same time and soon took over running it, tapping into financial subsidies and tax credits Washington was offering to wean the country off gasoline. California alone gave Tesla $3.2 billion in subsidies, according to figures provided by the office of California Gov. Gavin Newsom (D).

A review of public disclosure forms show that for brief periods of time, Musk hired dozens of lobbyists, many of them former staff members of powerful members of Congress. Rohan Patel, who worked on energy and transportation in the Obama White House, runs Tesla’s regulatory and legislative affairs in Washington.

SpaceX has spent more than $22 million to lobby Washington over the years, according to OpenSecrets, a research group tracking money in politics. Musk, himself, proved a savvy political operator. He flew into Washington 40 times between 2008 and 2013, according to flight records obtained by Musk biographer Ashlee Vance. He knocked on doors and invited officials to breakfast.

When backroom persuasion didn’t get results, he learned that publicity helps.

On a sunny Wednesday in June 2014, Musk parked his new “space taxi” a few blocks from Capitol Hill. He had hauled the capsule designed to carry seven astronauts into orbit across the country from his California factory and invited TV cameras, along with government officials, to check it out.

“Great job, Elon!” yelled Dana Rohrabacher, a Republican member of Congress, as he climbed out of the sleek spacecraft. Democrats applauded, too, that day. Musk was beaming. He was about to get richer.

The United States then relied on Russia to carry American astronauts to the International Space Station, paying Moscow tens of millions of dollars for each seat. Musk promised he would put an end to that and rebuild the American space program. Obama was in the White House and wanted to let private companies like SpaceX try. Weeks after Musk brought his space taxi to D.C., NASA awarded him a $2.6 billion contract.

Musk also pursued Pentagon contracts and found public confrontation helped. In a sparsely attended Capitol Hill hearing in 2014, he made headlines by slamming the joint venture between aerospace giants Lockheed Martin and Boeing that supplied rockets to the Air Force. He called it a “monopoly” and said it was vastly overcharging taxpayers.

“Elon was saying, ‘Give me a chance,’ ” said Scott Pace, a former NASA official who spoke at that hearing.

The Pentagon did, and Musk delivered. His game-changing, partly reusable Falcon rockets were considerably less expensive.

Now, just eight years later, Musk is the goliath of the space industry. And Musk’s success has shifted the dynamic with Washington.

Democrats are more vocal on the need to rein in Musk.

House Minority Leader Kevin McCarthy (R-Calif.) calls Musk “my good friend,” and Musk spoke at his August fundraiser. In June, Musk, who recently moved from California to Texas, announced he voted for Mayra Flores in a congressional primary – and said it was the first time he voted for a Republican. He also bashed Democrats as too extreme and too controlled by unions and publicly predicted a “massive red wave” in November.

But some Republican lawmakers are skeptical Musk’s new coziness with the GOP will last. “He’s another bullshit artist” is how former president Donald Trump described Musk at a July rally in Alaska.

A rare area of bipartisan agreement is that for certain vital issues, especially national security, the United States should not depend on any one person or company, and the federal government is making moves to lessen dependence on Musk.

NASA has funded Boeing’s Starliner capsule to compete with SpaceX to transport astronauts. (Blue Origin, which is owned by Jeff Bezos, who also owns The Washington Post, is also a competitor for NASA contracts.) NASA officials said Starliner’s delays and higher cost show why SpaceX is so dominant. “But still, we need a second option,” said one influential member of Congress.

The Federal Communications Commission in August decided it would not give SpaceX’s Starlink – which is now operating in 40 countries – a $900 million subsidy to bring broadband to rural areas even though that money had been provisionally granted in the waning days of the Trump administration. The FCC said the $600 satellite dish a home would need to purchase from SpaceX was a factor. A top SpaceX official called the rejection “unreasonable” and “grossly unfair.”

Congress also has been encouraging Ford and other automakers to build electric cars. A new condition on a federal $7,500 rebate is that the price of the new car cannot top $55,000. Most Tesla models cost more.

But Musk will be eligible for many subsidies and incentives, including for his electric charging stations. He just announced his Superchargers are now in 46 countries.

Musk hates “a false narrative out there that he is a grifter who survived off government handouts,” said Eric Berger, author of “Liftoff,” a history of SpaceX. “He sees the government as a double-edge sword,” Berger said. It can help but its bureaucracy slows him down. “He is really frustrated by the dizzying array of federal agencies that he has to deal with – and the bigger he gets the more there is.”

“Those bastards” is how Musk refers to officials at the Securities and Exchange Commission. The SEC fined Musk and Tesla $20 million each after Musk tweeted that he had “funding secured” to take Tesla private at $420 a share, after finding that was not true. The SEC is also now investigating Musk in connection with his Twitter takeover, including whether he complied with disclosure laws. Musk’s lawyer told a judge that the SEC was trying to “muzzle and harass” the businessman because he is an “outspoken critic of the government.”

Musk believes Tesla’s driver assistance system will save many lives and has said he is irritated by the publicity around the federal safety investigation into his Autopilot system. But government officials say it’s worth looking into whether the self-driving system was a factor in crashes, including some that were fatal.

Avoiding confrontation

Few want a head-on confrontation with Musk.

Biden got into one after Musk was not invited to a White House conference on electric vehicles in August 2021. Musk tweeted that the snub was the “next level of insanity,” and that Biden was controlled by unions. Musk also has been drawing attention to any Biden misstep, including when he mistakenly read instructions meant only for him on his teleprompter.

Apart from not wanting to get on his bad side, many in Washington admire his accomplishments and want to work with him. At the Pentagon, there are many who see Musk as a secret weapon. His Starlink satellite systems mean Ukraine soldiers have real-time information about military targets, and other countries are looking at how it can help their defense efforts.

In April, the White House said Musk was invited to a discussion about electric cars and charging stations and did make an appearance by teleconferencing.

“We used to be on the same page. Now, we are not always. It’s great when we are,” said one member of Congress. “One thing is clear: Musk believes he knows best, and he will do whatever he wants – and that can be good and it can be bad.”

Meanwhile, Musk is also working on an ever-growing number of ventures, from building robots that can cook dinner to plans for colonizing Mars.

Lepore, the historian, said Musk’s power is not like anything the country has seen before. “We should be worried, not because it’s inevitable that his influence would be malignant, but it’s inevitable that it would be a huge influence.”

Washington Post photo by Jonathan Newton
The SpaceX Inspiration4 mission launches from Kennedy Space Center in Florida on Sept. 15, 2021.