While the robotic arms at the Tesla factory are still roaring and the engines of the SpaceX Starship have yet to cool down, Elon Musk is stirring up a political storm on social media. This tech giant publicly criticized Trump's $4 trillion bill as a "disgusting financial monster," while Trump angrily responded, "This is betrayal." This direct confrontation between technology and politics not only caused Tesla's stock price to plummet by 3.5% but also exposed the real face of the struggle between old and new forces in American politics. The fuse: $2.4 trillion deficit and Tesla's life-and-death crisis. Musk's fire precisely hit the financial loopholes of the bill—according to the Congressional Budget Office, the bill will create a $2.4 trillion budget deficit over ten years, with debt-to-GDP ratio soaring to 125%. But what truly angered Musk was the "business strangulation order" hidden within the bill:
The electric vehicle subsidy cut bill reduces Tesla's proud electric vehicle tax credit from $7,500 to $3,000 and sets a stringent threshold of "70% domestic battery production." This means that the competitiveness of each Tesla vehicle will decline by $4,500, directly threatening its market share in the U.S.
The industry innovation act significantly cuts the clean energy R&D budget, slashing funding for lithium battery technology R&D by 60%, which poses a fatal blow to Tesla's 4680 battery plan. More critically, the bill cancels the regulatory exemption for autonomous driving technology, potentially delaying FSD deployment in the U.S. by at least two years.
A major shift in space policy: the Trump team suddenly withdrew the nomination of Jared Isaacman, a SpaceX ally, for NASA director, seen as a direct warning to Musk. Isaacman had led several collaborations between SpaceX and NASA, including a $12 billion military application order for Starlink.
Trump's anger: from "ironclad ally" to "political betrayal"
In response to Musk's public challenge, Trump's reply was filled with gunpowder: "I am very disappointed in Elon. I helped him immensely during his most difficult times, and he bit back. It’s simply betrayal!" Behind this statement are three layers of political calculation:
The collapse of the exchange of interests
During the 2024 presidential election, Musk donated $320 million in political contributions to Trump and used his platforms to rally support for him. In return, the Trump administration provided SpaceX with $28 billion in military orders and relaxed environmental regulations for Tesla. This "political donation - policy bias" chain of interests has now completely broken due to disagreements over the bill.
The crisis of internal division
The essence of the bill is a key agenda for Trump to woo traditional industry voters, yet it faces open resistance from tech newcomers. A rare division has emerged within the Republican Party: traditional manufacturing factions strongly support the bill, while the Silicon Valley faction stands with Musk. This split could affect Trump's base in the 2028 election.
A warning of power struggles
Trump's team withdrew Isaacman's NASA appointment, which is essentially a "political decapitation" of Musk. This appointment not only concerns SpaceX's government contracts but also the direction of U.S. space policy. This move sends a clear signal: if Musk continues to resist, SpaceX may lose government contracts worth hundreds of billions.
Market earthquake: Tesla's plunge and the reorganization of capital camps
This political storm quickly transmitted to the capital market:
After the news of the Tesla stock crash was announced, Tesla's stock price plunged by 3.5%, evaporating $45 billion in market value. Investors are concerned that the passage of the bill will lead to an $8 billion reduction in Tesla's profits by 2026.
Republican bonds were sold off, with the yield on infrastructure bonds related to the bill soaring by 50 basis points, as the market worries that the $2.4 trillion deficit will trigger a rebound in inflation.
Tech stocks under pressure: the Nasdaq 100 index fell by 1.2%, with tech giants like Apple and Google being affected, reflecting market concerns about the conflict between technology and politics.
The deeper impact lies in the reorganization of capital camps:
Traditional capital celebrates: steel, cement, and other infrastructure-related sectors rise against the trend, with U.S. Steel's stock price soaring by 7%, showing traditional industry capital's support for the bill.
Tech capital is on alert: Silicon Valley venture capital firms urgently held meetings to discuss the impact of the Trump administration's policy shift on the tech industry, with some firms beginning to reduce holdings in tech company stocks closely tied to the government.
Risk of foreign capital withdrawal: international investors' concerns about the stability of U.S. politics have intensified, with $4.5 billion in foreign capital withdrawing from U.S. stocks within 24 hours, setting a new high since October 2024.
Behind-the-scenes game: the true nature of the $4 trillion bill
Peeling back the glamorous packaging of the bill reveals a brutal redistribution of wealth:
The lavish feast for the rich: the bill permanently extends the 2017 tax reduction policy, with the top 1% of the wealthy receiving a 25% tax cut bonus, averaging $1.2 million in tax cuts per wealthy household.
The survival crisis of the poor also cuts $600 billion in healthcare subsidies and $260 billion in food stamps, with an estimated 9 million low-income individuals losing health insurance and 30 million families facing food shortages.
The debt trap for future generations: the $2.4 trillion deficit means that each newborn in the U.S. is born with $75,000 in debt, and interest payments will exceed the defense budget.
Ray Dalio, the founder of Bridgewater Associates, made a poignant remark: "This is paying for the votes of contemporary politicians with the future of our descendants. When the debt bomb explodes, those who cheer now will be the first to suffer."
Outcome prediction: a political strangulation with no winners
This game between technology and politics may ultimately lead to a triple defeat:
Musk's dilemma: although he has gained a reputation for "speaking for the people," he has offended some of the most powerful political figures in the U.S. SpaceX's government contracts may be canceled, Tesla's policy benefits may disappear, and it may even face stricter regulations.
The cost for Trump of losing support from tech newcomers may impact fundraising and voter base for the 2028 election. More seriously, if the bill is forcibly passed, it will exacerbate wealth polarization and social conflict in the United States.
Regardless of whether the bill passes, the opposition between technology and politics will deepen America's division. When innovation giants and political power are caught in endless internal strife, the ultimate casualties will be America's competitiveness and the welfare of ordinary people.
In this smoke-free war, both Musk and Trump believe they are the hunters, but they may both become the prey of political polarization in the United States. As a seasoned senator lamented: "When tech giants clash with political titans, it is always the audience that suffers. And now, the entire America is watching this dangerous performance."