Trump-Musk Feud Fractures a Powerhouse Alliance

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Trump-Musk Breakup Threatens Political and Economic Ripples

By TRH News Desk

NEW DELHI, July 2, 2025 – The once-unbreakable alliance between US President Donald Trump and billionaire Elon Musk has imploded in a spectacular public feud, unraveling a partnership that helped shape the 2024 election and early Trump administration policies. The fallout, which erupted on June 5 and reignited on July 1, has seen both titans hurling insults and threats across their respective social media platforms, Truth Social and X.

Trump has threatened to slash Musk’s government contracts, while Musk has hinted at funding Trump’s political opponents. The consequences could ripple across US politics, financial markets, and the space industry. This breakdown marks a seismic shift with far-reaching implications.

Origins of the Feud

The feud stems from Musk’s vocal opposition to Trump’s “One Big Beautiful Bill,” a sweeping tax and spending package projected to add $3 trillion to the deficit over a decade. Musk, fresh off a 129-day stint leading the Department of Government Efficiency (DOGE), called the bill a “disgusting abomination” on X and urged lawmakers to reject it.

Trump, in response, accused Musk of acting out of self-interest, pointing to the bill’s cuts to electric vehicle subsidies affecting Tesla and the withdrawal of Musk ally Jared Isaacman as NASA administrator. The spat quickly turned personal—Musk, without evidence, suggested Trump was linked to Jeffrey Epstein files, while Trump called Musk a “big-time drug addict.”

A Fractured Republican Coalition

Political commentator Jim Sciutto noted on X that the feud threatens the bill’s passage, erodes Trump’s support among Musk’s tech-savvy base, and fuels speculation about Musk’s third-party ambitions. Rory Stewart, another commentator, warned that the split “divides critical elements of the Trump coalition,” potentially derailing key debates on deficits, tariffs, and immigration.

The Washington Post framed the conflict as a clash between the tech right and MAGA populism—Musk’s push for technocratic reform now colliding with Trump’s base-driven agenda.

Musk’s financial clout—he spent an estimated $275–$290 million supporting Trump’s 2024 run—gives him significant leverage. His threat to fund primary challenges against Republicans backing the bill or to launch a new party representing “the 80% in the middle” could destabilize the GOP’s 2026 midterm strategy. Trump, clearly wary, warned of “very serious consequences” if Musk backs Democrats, hinting at regulatory or legal retaliation.

MSNBC cautioned that Musk’s vast wealth and X’s expansive reach could amplify his political attacks, while Trump’s laser focus on maintaining Republican control in Congress suggests he sees Musk as a serious threat.

Economic Fallout: Tesla and SpaceX in the Crosshairs

The economic implications are staggering. Tesla’s stock plummeted 14% on June 5, wiping out $152 billion in market value and reducing Musk’s personal net worth by $34 billion. The Washington Post reported Tesla shares are down 20% year-to-date, exacerbated by Musk’s political controversies and the possible loss of a $7,500 EV tax credit.

The Guardian, citing analysts at Wedbush Securities, warned of a “tough regulatory environment” under Trump that could intensify pressure on Tesla. Shareholders are reportedly pushing Musk to refocus on corporate priorities amid mounting political risk.

SpaceX, meanwhile, faces even greater peril. Trump’s threat to cancel federal contracts—valued at $38 billion across Musk’s companies, including $15 billion for SpaceX—could derail US space ambitions. Space policy expert Mark Whittington told The Washington Post: “If such threats were carried out, it would be catastrophic… Without SpaceX, we’re back to depending on the Russians for ISS access.”

Musk’s brief threat to decommission the Dragon spacecraft—later retracted—highlighted just how vital SpaceX remains to NASA’s Artemis program and International Space Station missions. The Hill noted that such a move could “debilitate the US space program,” grounding federal payloads indefinitely.

Broader Implications: Privatization Risks and Power Dynamics

The Guardian described the feud as a warning about “the dangers of placing key public goods in the hands of private companies controlled by erratic billionaires.” Musk’s dominance over space infrastructure, including Starlink’s communications network, has made him a critical component of national operations—raising alarms about over-reliance on a single individual.

PBS News reported that the dispute may disrupt federal programs reliant on Musk’s technology and further complicate Trump’s legislative agenda.

The New York Times outlined eight potential forms of retaliation: from Musk funding anti-Trump campaigns to Trump revoking Musk’s security clearance or probing his immigration status.

A Path to Reconciliation?

Despite the bitterness, some see a path back to détente. The Financial Times reported that allies are urging both parties to repair ties to limit political and commercial damage. GOP strategist Chris Johnson suggested that Trump’s threats could be part of his “Art of the Deal” playbook, implying the feud may be performative.

Musk’s deletion of inflammatory posts—including the Epstein allegation—and his June 11 expression of regret suggest a possible cooling-off. Yet Trump’s assertion to NBC News that the relationship is “over”, along with his reported consideration of divesting his Tesla holdings, signals that tensions remain high. Trump hit the raw nerve, saying that Musk could even be deported back to South Africa.

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