The U.S. election's biggest winner is Elon Musk. Here's why

UPDATED: Nov 7, 2024 14:24 IST

With Donald Trump all set to become the 47th President of the United States, his close aides and supporters are bound to reap some benefits but the biggest winner here is Elon Musk.

The tech billionaire’s growing political influence, especially his backing of Trump for a second presidential term, could give him a unique position to benefit his companies through favourable government treatment and reduced regulatory oversight.

Musk reportedly donated $119 million to a pro-Trump campaign, marking a major financial endorsement and helping fund a significant get-out-the-vote effort as Trump faced intensified competition. Musk’s support for Trump reflects a strategic approach to secure less regulation for his businesses, which span Tesla, SpaceX, Neuralink, and the AI startup xAI. Each of these ventures relies heavily on federal regulation, subsidies, or government policy.

Former SpaceX employees have also stated that Musk views regulation as a hindrance to his business goals, and sees the Trump administration as an opportunity to circumvent regulatory barriers, allowing for more rapid innovation in his projects. His alliance with Trump could deepen further if he is appointed as an "efficiency czar" in the administration, giving Musk even more clout.

Musk's support for Trump comes after perceived exclusions and challenges under the Biden administration, including Tesla’s absence from a White House EV summit that prioritised unionised automakers.

When it comes to Tesla Musk’s goal is to influence regulators, particularly the U.S. Highway Traffic Safety Administration (NHTSA), to halt potential enforcement actions on Tesla’s driver-assistance systems like Autopilot and Full Self-Driving. Musk’s objectives could also include the relaxation of rules for Tesla’s autonomous vehicles and robotaxi operations, a shift that would alleviate compliance issues across the various state-by-state regulatory frameworks.

For Neuralink, Musk’s brain implant company, Musk may use his political leverage to expedite FDA approval processes for human trials. Neuralink employees suggest that Musk’s influence could help reduce safety oversight in the process, potentially allowing the company to sidestep standard procedures.

SpaceX, Musk's rocket company, would likely see additional advantages through softened regulatory standards. While it currently operates with relatively little interference from agencies like NASA despite documented worker injuries, a more Trump-friendly regulatory environment could further diminish oversight on workplace safety and operational practices. SpaceX leads globally in government-sponsored rocket launches, with nearly $15 billion in NASA funding, and Musk’s growing influence could continue to sway agencies to avoid actions that might hinder his goals. Moreover, Musk has advocated for fewer restrictions on private spaceflight safety in orbit, leveraging a congressional ban on FAA oversight to push SpaceX projects forward, regardless of potential risks.

Musk’s increasing political clout has sparked a broader libertarian movement within Silicon Valley, shifting away from its historically liberal stance. He has criticised what he calls the “woke mind virus” in California’s tech community, aligning himself with a pro-business, anti-regulatory ideology that has attracted support from various influential figures.

Musk's strategic support for Trump appears to be part of a larger plan to use his political influence to reshape federal regulations and remove obstacles to his companies’ operations. However, critics warn that prioritising deregulation could have lasting consequences, particularly in industries as sensitive as autonomous vehicles, spaceflight, and medical devices. While Musk’s backing of Trump may bring short-term gains for his companies, the broader implications of his reduced regulatory approach could impact not only the safety and competitiveness of these industries but also the future of innovation and corporate power in the U.S.