Elon Musk isn’t the one tech billionaire with energy over the federal companies that regulate his companies. Since Donald Trump took workplace, greater than three dozen workers, allies, and buyers of Musk, Peter Thiel, Marc Andreessen, and Palmer Luckey have taken roles at federal companies, serving to direct billions in contracts to their firms.
Corporations owned, based, or invested in by Musk, Thiel, Andreessen, and Luckey have collected greater than a dozen federal contracts totaling about $6 billion since Trump’s inauguration in January, in response to a Wall Street Journal analysis. And so they’re actively pursuing billions extra.
These appointments, that are in departments that oversee, regulate, and award enterprise to the 4 males’s firms, increase quite a few pink flags. They might violate conflict-of-interest legal guidelines or authorities ethics rules, each of which prohibit federal workers from utilizing public workplace for personal achieve.
And whereas it’s commonplace to put in trusted allies in authorities roles, Musk’s community has moved in at an unprecedented charge and scale. TechCrunch has beforehand reported on all the folks in Musk’s universe who’ve joined him at DOGE, the place he has shuttered federal companies and slashed workforces in departments that regulate his companies. A minimum of 19 others with Silicon Valley connections, be they founders or buyers, have additionally joined DOGE.
“The second Trump administration is definitely the primary lately to not impose any form of further ethics safeguards on high-level appointees,” Daniel Weiner, director of the Brennan Middle’s Elections and Authorities Program, instructed TechCrunch. He famous that Trump fired at least 17 people on the Workplace of Authorities Ethics, together with the director, instantly after taking workplace.
“It definitely does doubtlessly enhance the chance that you’ve folks engaged on issues that do influence, a minimum of not directly, their backside traces,” Weiner stated. “However this can be a long-term concern in our authorities that’s not distinctive to this administration.”
Innovation versus accountability
Some might argue that it is sensible for workers and associates of Musk, Thiel, Andreessen, and Luckey to hitch authorities companies. Their insiders are proficient people who’re behind the cutting-edge know-how the federal government genuinely wants, and so they perceive the way to innovate rapidly and compete globally.
Extra critical questions come up when favoritism threatens to undermine competitors, when coverage is created or destroyed to guard market dominance, or when rules that may serve the general public good are waylaid to advertise enterprise pursuits.
As an example, the Client Monetary Safety Bureau not too long ago retreated from pursuing guidelines that may limit knowledge brokers, regardless of rising privateness considerations — a shift that stands to profit firms concerned in AI, surveillance, and knowledge analytics. One other instance is DOGE’s firing of staffers on the Nationwide Freeway Site visitors Security Administration who examine autonomous automobile security, together with a number of probes into Tesla.
“One of many defining structural challenges the federal government of the USA has proper now could be that we now have a system by which the very wealthiest pursuits have a lot energy to form our elections after which flip round and form authorities coverage,” Weiner stated.
One other Silicon Valley appointee, Mike Kratsios — a former Thiel worker — is now main know-how coverage for the U.S. authorities. In an April speech, he spoke about throwing away dangerous rules that “crush our innovators,” significantly those that are innovating in AI.
“Many individuals in Silicon Valley are likely to assume that no matter labored in Silicon Valley can be going to work for administering the USA authorities,” Weiner stated. “And as we’re seeing now, the hazard is lots of people are going to get harm due to the assumptions they make.”
“The truth that you had a profitable startup after 5 others failed doesn’t essentially imply you understand how to run the Social Safety Administration,” he continued.
A community inside and a payoff exterior
All the companies between Musk, Thiel, Andreessen, and Luckey are associated. Musk’s SpaceX was backed by Thiel’s Founders Fund and Andreessen’s a16z (which additionally invested in X and xAI). Each of these VCs additionally backed Anduril, Luckey’s protection startup.
The overlapping community of founders, funders, and insiders extends into a number of federal companies. And in lots of instances, these companies are steering billions in federal contracts again to these firms.
The Journal discovered that throughout Washington, folks from Musk’s community, together with Tesla, X, and SpaceX, are in additional than a dozen companies, from the chief workplace of the president and Workplace of Personnel Administration all the best way all the way down to the Division of Transportation and the Division of Vitality.
SpaceX workers are additionally in companies that might present the corporate new enterprise. For instance, the Journal stories that SpaceX senior engineer Theodore Malaska acquired an ethics waiver in February that lets him take a short lived job on the Federal Aviation Administration whereas nonetheless working on the rocket firm. The FAA hasn’t given any contracts to SpaceX but, however Malaska said on X the company has used Starlink to improve a climate observing system in Alaska.
SpaceX can be the primary business supplier that transports crew and cargo for NASA. Regardless of nationwide safety considerations – like the corporate’s secret backdoor for Chinese language funding and Musk’s reported habit of drug-taking – SpaceX in April received $5.9 billion of a $13.7 billion multi-year contract from the U.S. Area Power in April to launch Pentagon missions. The DOD, which is at present a Starlink buyer, additionally plans to purchase SpaceX’s Starshield satellites, a militarized model of the web satellites.
Workers at Thiel-backed companies have discovered themselves in roles within the State Division, the Workplace of Administration and Finances, Well being and Human Companies, and Social Safety, per The Wall Avenue Journal. Thiel’s Palantir has already been awarded practically $376 million since 2020 from Well being and Human Companies. In 2024, the corporate was additionally awarded a minimum of $1.2 billion in Department of Defense contracts in 2024, and is within the operating for another $100 million deal.
Anduril, Palantir, and SpaceX not too long ago submitted a multibillion-dollar proposal for Trump’s “Golden Dome” missile-defense program, which might additionally add to Anduril’s current contracts with the U.S. Military. Lately, Anduril and Microsoft took over a 2021 contract price as much as $22 billion to develop AR headsets, per the Journal.
An Anduril govt, Michael Obadal, has been nominated to a prime position on the Division of Protection. In his ethics disclosure, he said that he would retain his Anduril stock if appointed.
TechCrunch has reached out to Anduril, Andreessen Horowitz (a16z), Palantir, and SpaceX for remark.
“This form of focus of personal wealth and political energy is in the end very dangerous for our economic system,” Weiner stated. “As a result of as a substitute of the federal government making choices which can be supposed to foster competitors, foster financial progress, you run the actual danger that authorities choices are going to as a substitute be structured round defending specific firms and specific industries from full financial competitors.”