It’s not yet seven weeks since two of the most powerful men in America bid each other a fond farewell during a meeting in the Oval Office, Elon Musk hanging up his hat as the head of the Trump administration’s Department of Government Efficiency and returning to Texas as CEO of Tesla.
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But if anyone had expected the South African-born executive was ready to walk away from politics they’d have made a serious miscalculation. Over the long Independence Day holiday, Musk announced plans to start a new political party he’s calling “America.” Considering the $270 million he invested in backing Donald Trump’s campaign for a second term barely dented his massive bank account, Musk has more than enough cash to back this latest move.
That hasn’t gone down well at the White House where Trump took aim at his former ally on Monday, declaring that Musk had gone “completely off the rails”…”essentially becoming a TRAIN WRECK.” But the reality is that what has become a bitter and noisy feud could prove disastrous for both men.
One Big Beautiful Mess
The war of words began just days after Musk left DOGE. He quickly called on Congress to shoot down the “One Big Beautiful Bill,” the controversial government spending bill set to slash services like Medicaid even while adding trillions of dollars to the national debt. Musk warned Republicans that he would “primary” those who supported the measure and raised the prospect of going even further. And that’s precisely what he appears ready to do.
For his part, Trump quickly shot back, much as he’s done when other allies have been perceived as showing disloyalty. Musk appeared to back down – briefly – last month, saying in a post on his social media site X, that he “went too far” with some – though, apparently, not all – of the things he said about Trump. But any expectations that the two men would find common ground vanished as the spending bill was put to a vote just ahead of the holiday.
“When it comes to bankrupting our country with waste & graft, we live in a one-party system, not a democracy,” Musk tweeted on July 5. “Today,” he added, “the America Party is formed to give you back your freedom.”
Third Parties
According to a decidedly less-than-scientific poll on X, Musk claimed 2-to-1 support for creating his new party. But does it have any chance to actually impact future elections?
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It didn’t take long for the then-new republic to evolve into a system with two dominant parties. But time and again, third parties have emerged, often at critical points in U.S. history, such as during Prohibition. They’ve generally had little impact beyond the state and local level, however. The last time a new party send a candidate to the White House was when Republican Abraham Lincoln was elected president – quickly touching off the Civil War. Even the once popular Teddy Roosevelt couldn’t reclaim the Oval Office after seeking to return through his new Bull Moose Party.
That’s not to say third parties aren’t influential. Vermont’s Bernie Sanders has an outsized presence as an Independent. Meanwhile, billionaire businessman H.Ross Perot is widely believed to have cost George H.W. Bush his reelection bid in 1992 – though the Green Party candidate, activist Ralph Nader, played a role in helping George W. Bush win his campaign against Vice President Al Gore eight years later.
Collateral Damage
It should come as no surprise that Trump is using his bully pulpit – enhanced by his own Truth Social service – to blast Musk. He has seldom hesitated to turn on one-time allies. But some political observers warn the America Party could provide an alternative to the Republican Party that has been remade in Trump’s image – possibly draining more moderate voters who, polls show, are growing increasingly concerned about many of the president’s policies.
How much Musk might have on Trump is a question first raised last month when the Tesla boss suggested a link between the president and the late sexual predator Jeffrey Epstein. Perhaps not so coincidentally, the FBI and Dept. of Justice both announced Monday that Epstein had left no list of his clients.
What might Trump have on Musk? That big spending bill is already set to do some serious damage to Tesla, with the current federal tax credits of up to $7,500 for new EV buyers set to end in September. It’s also set to eliminate the zero-emission vehicle credits that have generated billions of dollars in revenue for Tesla over the years through sales to companies like Stellantis and General Motors.
How Much Can Money Buy
Musk reportedly invested more than $270 million to help Trump get elected last year. That was the proverbial drop in the bucket considering Forbes estimates the Tesla boss is worth around $400 billion.
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But money alone might not be enough, Bernard Tamas, a political science professor at Valdosta State University in Georgia, told NBCNews. Setting up a new political party is “not like running a business,” he said. “It’s got to be more like a social movement. It’s got to be kind of a grassroots thing, where people are motivated and energized to fight.” Meanwhile, it’s anyone’s guess whether Musk can overcome the hit his once-stellar reputation took while running DOGE. “The principles of DOGE were very popular,” Trump’s Sec. of the Treasury Scott Bessent said on CNN. However, “I think if you looked at the polling Elon was not.”
The Bully Pulpit
The feud with the president hasn’t been kind to Tesla stock – which initially surged after he left Washington. Musk’s own bank account shrank by about $14 billion due to the nearly 7% drop in Tesla’s share price on Monday.
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Trump could cost Musk and other shareholders far more, he signaled in a Truth Social post last week: “The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon’s Governmental Subsidies and Contracts.” Not only Tesla could be savaged, but other Musk companies such as SpaceX. The president took things a step further. Even before Musk’s latest announcement, he said he may order his staff to “take a look” at the possibility of deporting the South African-born entrepreneur.
There was a brief moment, late last month, when the two men seemed ready to call for a truce. At this point there seems to be little opportunity to kiss and make up, political observers said Monday.