Let Elon have his moment in the Sun

Elon Musk has become the world’s first paper trillionaire with the public flotation of SpaceX last week. But this may be as good as it gets. While the share issue valuing SpaceX at $1.77 trillion defied critics (it closed on its first day with a capitalisation over $2 trillion), and is an emphatic show of confidence in Musk, days when he can bathe in the acclaim are getting rarer.

A decade ago, such acclaim would have been almost universal. Back then, Musk was less wealthy and much less famous, but still one of the era’s most magnetic business figures. He had created two successful companies, SpaceX and Tesla, proving that ambition and private enterprise could succeed against the odds – firstly, with reliable low-cost rocket launches, and then with an attractive mass-market electric car. As America turned from a buccaneering nation into a state-capitalist bureaucracy, this South African-born, naturalised Canadian renewed the American myth. He proclaimed his own personal Manifest Destiny was sending a manned mission to Mars.

If anything, Musk’s bravery was under-appreciated at the time. Later, his two tentpole businesses would be accused of being cushioned from competition by government support – in the form of EV credits for Tesla, and long contracts from NASA. Perhaps, Musk’s critics grumbled, his entrepreneurial talents were inflated.

But the opposite was true, as related in Ashlee Vance’s 2015 biography: the high-wire act of keeping these capital-intensive enterprises alive against the odds would have defeated many other executives.

There was a lot to admire in both big ventures. In the era of outsourcing, Musk defied the conventional wisdom by insisting on vertical integration, or doing as much as possible in house. He also embraced manufacturing, a heresy according to the gospel of globalisation.

Little wonder he was keen to be associated with Marvel Comics character Tony Stark, the eccentric playboy inventor and industrialist who also moonlights as Iron Man. Musk was so taken by the comparison he arranged a cameo in Iron Man 2, after donating SpaceX facilities as a location for the movie’s filming.

At the time, Musk’s poor judgements were seen as eccentricities, and perhaps even proof of his hidden genius. For example, Hyperloop was Musk’s concept for a high-speed shuttle, placing small pods in a vacuum and propelling them at over 700 miles per hour. It was little more than a lightly developed 58-page napkin sketch.

Musk’s mean side – libelling an English caver who rescued 12 Thai schoolchildren in 2018 as a ‘pedo guy’ – was shrugged off, even after some stunning cruelty emerged in Vance’s biography. His executive assistant of 12 years, Mary Beth Brown, was fired after Musk asked her to take a two-week holiday in order to find out how important she was for the business. When she returned, Musk reportedly gave her the sack (although Musk disputes this version of events).

When did the public turn? It’s a question former fans like to discuss. Musk inevitably lost the Guardianistas the moment he made statements railing against immigration and the ‘woke mind virus’ – but he has lost some of his strongest supporters, too.

There are reasons. Musk’s broken promises about autonomous driving capabilities are so long they have their own Wikipedia page. Tesla’s product pipeline has also grown stale: it has not offered a new saloon model for several years, and its ill-conceived and poor-selling Cybertruck is another sketch that should have stayed on a napkin. Rivals, led by China’s BYD Auto, offer superior quality to Tesla at a much lower price.

Twitter was an impulse buy that Musk tried very hard to get out of, until being ordered to complete the deal by a court. His political interventions have been ignorant and counter-productive, such as backing the hard-right AfD in Germany and Rupert Lowe’s ethno-nationalist party, Restore Britain, in the UK. Both hamper rather than help construct a lasting response to identity politics. In America, the effectiveness of DOGE (Department of Government Efficiency) in slashing public spending is highly contested. The savings may be far less than those attributed to it.

SpaceX’s ‘goldilocks’ initial public offering – everything went just right – was like a retired rock star returning to the stage. The new fans are curious to see what the fuss is about, while the old fans are pleased just to see him do well again. But this may be as good as it ever gets.

Firstly, inflated valuations inevitably decline, and this decline will have a personal impact on many Americans. What’s more, its valuation is derived from staggeringly optimistic xAI revenues. The prospectus expects Grok to capture more revenue – $26.5 trillion – than the entire digital economy is worth today. That would be quite a turnaround, as demand for Grok AI is so low today that Musk has leased his datacenters to Meta and Anthropic.

And as I wrote in the Telegraph recently, by 2030 SpaceX will face serious competition in both the launch market and satellite-connectivity markets. Jeff Bezos’s Blue Origin rocket suffered a catastrophic disaster last month, which destroyed its launch facility, causing billions of dollars of damage. But Bezos’s deep pockets and the personal nature of his rivalry, along with the US government’s need for a second (and less erratic) supplier, mean the setback will be temporary.

While buccaneering business leaders can make a difference and even set the tone of the times, politics offers a more reliable route for lasting change – whether it’s smaller government or less identity politics. Relying on one deeply flawed man like Elon Musk to deliver it for us is ultimately infantalising.

Andrew Orlowski is a weekly columnist at the Telegraph. Visit his website here. Follow him on X: @AndrewOrlowski.