Musk’s Tariff Plea Ignored by Trump

Elon Musk, the world’s richest individual and a prominent supporter of former President Donald Trump, recently attempted to persuade Trump to reconsider a new wave of tariffs. Despite Musk’s efforts, the administration moved forward with a 10% baseline tariff on all U.S. imports, with even higher rates on imports from China. This decision has sparked significant market volatility and highlighted a growing divide between business leaders and Trump’s protectionist trade policies.

Musk’s Intervention and Trump’s Response

Over the weekend, Musk reached out to Trump, urging him to halt the implementation of new tariffs that could adversely affect U.S. businesses. However, Trump not only dismissed Musk’s advice but escalated the situation by threatening an additional 50% tariff on Chinese imports. This move has raised concerns among investors and business leaders, as it compounds the existing 10% tariff and has already triggered market instability.

Musk’s intervention was not limited to direct communication with Trump. Influential figures in his circle, such as investor Joe Lonsdale, also made appeals to key administration officials, warning that the tariffs would harm American businesses more than foreign competitors. Despite Musk’s significant financial contributions to Trump-aligned causes—totaling nearly $290 million—his inability to sway the president underscores a rift within Trump’s inner circle regarding trade policy.

Economic Fallout from Tariffs

The implications of Trump’s tariff strategy are profound. Following the announcement of the tariffs, the world’s wealthiest individuals collectively lost $536 billion in just two days of stock market trading, marking the largest two-day drop recorded by Bloomberg’s billionaires index. Musk himself has seen a staggering decline in his net worth, estimated at $130 billion this year alone. Despite this, he remains the richest person globally, with a fortune of $302 billion.

Tesla’s stock has also suffered, plummeting over 38% this year. Analysts attribute this decline to the combination of Trump’s tariffs and growing backlash against Musk’s political affiliations, which are impacting Tesla’s demand in critical markets like China and Europe. Dan Ives, an analyst at Wedbush Securities, has downgraded Tesla’s target price significantly, citing a “brand crisis tornado” that has intensified.

A Broader Business Rebellion

Musk’s recent public stance against tariffs reflects a broader rebellion among pro-Trump elites who are increasingly concerned about the economic consequences of Trump’s trade policies. During a virtual appearance at a far-right Italian political conference, Musk advocated for a “free trade zone” between the U.S. and Europe, emphasizing the need for zero tariffs. He also suggested that liberalized immigration policies between the two regions could benefit both economies.

Musk’s criticisms of Trump’s trade adviser, Peter Navarro, have further fueled tensions. In a series of posts on social media platform X, Musk ridiculed Navarro’s academic credentials and questioned his expertise in trade matters. This public dissent highlights Musk’s willingness to challenge Trump’s economic nationalism, a departure from his previous alignment with the administration.

The Future of Musk’s Influence

As Musk’s relationship with the Trump administration appears to be deteriorating, other business leaders are quietly forming coalitions to advocate for more moderate trade policies. Treasury Secretary Scott Bessent hinted that some tariffs might be part of a broader negotiation strategy, but Trump remains steadfast in his approach. He has threatened to veto bipartisan legislation aimed at limiting his unilateral tariff powers.

Musk’s failed attempt to influence Trump’s tariff decisions raises questions about the extent of his influence within the administration. If a billionaire with Musk’s resources and connections cannot sway Trump, it remains uncertain who can. The fallout from this intervention may have lasting implications for Musk, Tesla, and the broader business community as they navigate the challenges posed by Trump’s trade agenda.

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