‘Cut it all’: Musk responds to Trump’s threat to end Tesla subsidies


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Summary

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President Donald Trump suggested that the federal government review subsidies tied to Elon Musk's companies.

Musk responds

Musk said he doesn’t want government subsidies, writing on social media, “I am literally saying cut it all. Now.”

Point of contention

The feud between Trump and Musk centers on the president’s budget plan, which he calls the “big, beautiful bill.”


Full story

The feud between President Donald Trump and Elon Musk has reignited, centered on a proposed federal tax and budget package that Trump strongly supports and Musk strongly opposes. In a post on Truth Social, Trump floated the idea that the Department of Government Efficiency (DOGE) should consider slashing federal subsidies to Musk’s businesses.

Musk led the agency for the first few months of Trump’s second term.

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“Without subsidies, Elon would probably have to close up shop and head back home to South Africa,” Trump wrote Monday, June 30. “No more rocket launches, satellites, or electric car production, and our country would save a fortune. Perhaps we should have DOGE take a good hard look at this? Big money to be saved.”

On Tuesday, July 1, ABC News reported that Trump told reporters his administration would “have to take a look at” deporting Musk, a naturalized citizen and native of South Africa.

Musk responds: ‘Cut it all. Now.’

Trump has repeatedly implied that Musk opposes the budget package because it could reduce subsidies that benefit Tesla and his other companies. Musk, however, maintains he is concerned that the package would balloon the government’s debt ceiling by $5 trillion.

On X, Musk suggested he does not care about the potential loss of government subsidies.

“I am literally saying cut it all,” he wrote. “Now.”

According to public interest watchdog Good Jobs First, Tesla has received nearly $3 billion in government subsidies since 2007. The company ranks 16th among all businesses in terms of financial benefit from government programs. Musk’s SpaceX and Starlink are not ranked in the top 100.

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Over the last two decades, Elon Musk’s companies, including Tesla, have received around $38 billion in government contracts.

Feud tied to Trump’s budget plan

Between the election and Trump’s inauguration, Musk mostly stayed at the president’s Mar-a-Lago estate in Florida, and he described himself as the “first buddy.” Shortly after Musk stepped away from his work with DOGE, however, he entered into a public feud with Trump, once even suggesting that the president was implicated in a sex-trafficking investigation of the disgraced financier Jeffrey Epstein.

Musk later said he regretted some of his comments about Trump, but in recent days, he resumed his criticism of the budget proposal. Now, their disagreement has once again publicly spilled out across social media platforms.

Alan Judd (Content Editor), Lawrence Banton (Digital Producer), and Harry Fogle (Video Editor) contributed to this report.
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Why this story matters

The ongoing public dispute between Donald Trump and Elon Musk over federal subsidies and budget policy illustrates broader debates about government funding for private enterprise, political influence and the intersection of personal and national interests.

Government subsidies

Debate around federal financial support for private companies like Tesla and SpaceX highlights questions about the role of government in fostering innovation and business growth.

Political conflict

The renewed feud between Trump and Musk demonstrates how personal and political disagreements can spill over into public policy debates and potentially influence administrative decisions.

Public accountability

Discussions about government spending and the potential impact of budget proposals raise issues of transparency and accountability regarding the use of taxpayer funds.

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Context corner

Historically, government subsidies and contracts have played a key role in supporting industries considered strategically important, such as aerospace and energy. Both Trump and Musk, despite previous cooperation, now reflect broader cultural divisions in the U.S. regarding fiscal responsibility, corporate welfare and political loyalty. This split highlights longstanding debates on government involvement in business.

Do the math

The Congressional Budget Office estimates that the Senate version of the spending bill would increase the national debt by approximately $3.3 trillion over 10 years. Tesla has benefited from up to $7,500 per vehicle in tax credits, with Musk’s businesses receiving an estimated $38 billion in federal support. Tesla’s market saw a one-day loss of $150 billion in valuation after their feud went public.

History lesson

Previous U.S. administrations have threatened to revoke subsidies or contracts from large corporations as leverage during political disagreements, but such actions rarely proceed due to legal hurdles and potential economic fallout. History suggests abrupt withdrawal of government support can have disruptive economic consequences and is rarely sustained over the long term.

Bias comparison

  • Media outlets on the left frame the Trump-Musk feud with a critical lens, emphasizing the harm of Trump’s “big, beautiful bill” on social safety nets and portraying Trump’s threats — such as deportation and using DOGE as a "monster" — in xenophobic and dehumanizing terms, using charged words like “threatens,” “feud” and “disgusting abomination” to underscore hostility.
  • Media outlets in the center de-emphasize ideological conflict, focusing instead on market impacts and political dynamics, thus providing a calmer, informational tone.
  • Media outlets on the right highlight the bill as a legislative triumph, characterizing Musk as hypocritical for attacking subsidies that he “relies heavily on,” employing assertive language like “threatens,” “excoriated” and “blasts” to depict Musk’s criticism as damaging GOP interests.

Media landscape

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Key points from the Left

  • President Donald Trump threatened to cut subsidies to Elon Musk's companies, implying he could deport Musk over criticism of his spending bill.
  • Musk criticized the Republican spending bill, claiming it would kill jobs, and suggested forming a new political party if it passes.
  • Trump's spending bill is projected to increase the national debt by at least $3.3 trillion, according to the Congressional Budget Office.
  • Musk accused Republicans of "debt slavery" for supporting the bill that contradicts earlier promises of reduced spending.

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Key points from the Center

  • On Tuesday, July 1, at the White House, President Donald Trump publicly criticized Elon Musk over subsidies for Musk's companies amid an escalating feud.
  • The dispute arose as Congress considered a spending bill to roll back electric vehicle tax incentives, which Musk opposes and calls political suicide for Republicans.
  • Trump claimed Musk receives more subsidies than anyone in history and warned Musk could lose more, even suggesting the Department of Government Efficiency might target him.
  • Tesla’s shares dropped close to 5% in early trading on Tuesday after Trump’s comments, while Musk criticized members of Congress who backed the bill, saying they should feel ashamed.
  • Musk announced plans to establish a political party should the bill be approved and pledged to support efforts to remove legislators who back it, signaling possible changes in the U.S. political landscape.

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Key points from the Right

  • U.S. President Donald Trump suggested an audit of subsidies received by Elon Musk's companies to save money, stating, "Elon may get more subsidies than any human being in history, by far."
  • Musk criticized Trump's tax-cut and spending bill, calling it "utterly insane and destructive," and vowed to campaign against supportive lawmakers.
  • Trump warned Musk about potential deportation and threatened to cut government contracts, reigniting their public feud.
  • Tesla's stock fluctuated sharply, losing about $150 billion in market value as tensions between Trump and Musk escalated.

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