Key Points
- Elon Musk publicly criticizes President Trump’s $3.8 trillion spending bill, calling it fiscally irresponsible
- Bill would extend 2017 Trump tax cuts, increase border spending, and slash clean energy credits
- Nonpartisan estimates say the bill could add $3.8 trillion or more to the federal deficit by 2034
- Musk says the bill undermines the Department of Government Efficiency (DOGE), which he leads
- Market reacts with bond yields hitting highest levels since 2007 amid debt concerns
- Musk’s critique comes as Tesla faces its lowest sales in three years, prompting him to scale back his political role
Washington D.C.: In a striking public split with President Donald Trump, Elon Musk has voiced sharp criticism of the administration’s sweeping $3.8 trillion spending proposal, known as the “One Big Beautiful Bill.” The measure, which narrowly passed the House and awaits Senate approval, would permanently extend Trump’s 2017 tax cuts, ramp up border funding, slash clean energy credits, and add new Medicaid work requirements.
Musk’s Main Concerns: Deficit and DOGE
Musk, who heads the White House’s Department of Government Efficiency (DOGE), said in a CBS interview preview, “I was disappointed to see the massive spending bill, frankly, which increases the budget deficit, not just decreases it, and undermines the work that the DOGE team is doing.” He added, “I think a bill can be big or it can be beautiful. But I don’t think it can be both. My personal opinion”.
DOGE, launched with Musk at the helm, was tasked with modernizing federal operations and cutting government waste. The department claims to have saved over $175 billion through agency closures and contract cancellations, but has faced criticism for lack of transparency and legal challenges to its mandate.
The Fiscal Fallout: Soaring Deficit and Market Turbulence
Nonpartisan projections, including those from the Congressional Budget Office and University of Pennsylvania, estimate the bill could add $3.8 trillion or more to the federal deficit by 2034 far above the $2.8 trillion cap set by budget reconciliation rules. The bill’s tax provisions would reduce federal revenue by $4.5 trillion over the next decade, with only modest economic growth offsetting a fraction of the losses.
The market response was swift: long-term U.S. Treasury yields surged to their highest since 2007, reflecting investor anxiety over the nation’s ballooning debt, now exceeding $36 trillion. Analysts warn that the fiscal outlook could drive borrowing costs even higher, affecting everything from mortgages to business loans.
Political and Economic Repercussions
Musk’s criticism comes at a turbulent time for his own ventures. Tesla’s April sales have plunged to their lowest in three years, prompting Musk to announce a reduced role in DOGE in order to refocus on his companies. Meanwhile, the bill faces an uncertain future in the Senate, with some Republican lawmakers demanding deeper spending cuts and others objecting to reductions in Medicaid and clean energy incentives.
What’s Next?
- The Senate is expected to debate and possibly amend the bill, with passage far from guaranteed due to internal GOP divisions and mounting public scrutiny.
- Musk, once one of Trump’s closest outside advisers and largest donors, has scaled back his political involvement, saying, “I believe I have contributed enough”.
- The broader debate over fiscal responsibility, tax policy, and government efficiency is set to intensify as the U.S. approaches its next election cycle.
Elon Musk’s public rebuke of Trump’s “Big Beautiful Bill” marks a significant rift between two of the most influential figures in U.S. business and politics. With the national debt at record highs and markets on edge, the battle over America’s fiscal future is only heating up.
