Wang Ye/Xinhua via AP
Elon Musk meets with Chinese Premier Li Qiang in Beijing, April 28, 2024.
Thus far in President Trump’s second term, shadow president Elon Musk’s rampage through America’s basic constitutional structure has gotten extensive coverage in the press. It is becoming clear that Musk and his goon squad of tech bros in their early twenties are attempting to seize direct control of the system by which the federal government disburses more than $5 trillion in payments annually, apparently so they can pick and choose who and what gets funded. And they have rifled through personnel files, scientific data involving health care and the environment, and bunches of other government information, for purposes of either propaganda or opposition research.
But there is another aspect to Musk’s rule in Washington that is partly flying under the radar: the national-security threat, particularly regarding China. Musk has huge and extensive connections to the Chinese dictatorship, both personally and through his businesses, and he has a long history of bending over backwards to appease its desires.
Now, national security has often been the justification for terrible crimes in American history—illegal surveillance, toppling democratically elected governments, wars of aggression, and so on. But that doesn’t mean the idea is meaningless. Nations like Russia, North Korea, and yes, China have carried out espionage attacks on the United States government and American citizens alike. It doesn’t make one Paul Wolfowitz to think that a man subject to stupendous influence from a sinister foreign dictatorship should not have unilateral control over the Treasury Department’s payments system.
Musk’s ties to China largely revolve around Tesla. The company’s largest factory is in Shanghai, where it produces half—over 900,000—of its vehicles sold worldwide. One source estimated that nearly 40 percent of Tesla’s battery supply chain relied on Chinese companies, and those relationships are growing. In 2022, Tesla opened a showroom in Xinjiang, where China is conducting a cultural genocide against its Uyghur minority. Tesla then built a large battery factory in 2024, also in Shanghai. It seems Musk likes the hyper-repressive Chinese labor system; he praised his Chinese employees for burning the “3 a.m. oil” in 2022.
Tesla has also received large government subsidies, both tacit and explicit, from the Chinese state. It was the first and so far only foreign car company allowed to operate by itself in the Chinese market, as opposed to others like Volkswagen that had to form a joint venture with a Chinese company. Tesla has also secured more than half a billion dollars in loans from state-owned banks there, as well as a 10 percentage point break on its corporate tax rate that lasted until 2023.
Tesla has received large government subsidies, both tacit and explicit, from the Chinese state.
It’s not a coincidence that China is also Tesla’s largest market, and indeed has become more important to the company of late. While sales fell in Europe and the U.S. last year, and appear to be falling faster since Trump was elected (which is surely driven in large part by Musk’s Nazi antics), Tesla sold 657,000 cars in China in 2024—an increase of about 9 percent.
Given Tesla’s heavy dependence on its Chinese investments, Musk’s support for Trump’s attack on Joe Biden’s climate policies makes more sense. While Tesla’s U.S. sales will suffer if the EV tax credit in the Inflation Reduction Act is reduced, its competitors will likely suffer more, because their EV investments are still in the early stages. But more importantly, the IRA contains requirements that EV components be sourced in North America if they are to receive the EV tax credit, which tighten over time. EVs could not qualify if they had batteries sourced from China in 2024, which was to extend to minerals in 2025, and graphite and other materials in 2027.
Trump has illegally blocked IRA funding, and has promised to repeal the law entirely. Whether he could get that through the Republican majority in Congress is an open question, but it may not matter if Musk simply seizes control of the IRS. Should that happen, the benefits for Tesla would be substantial, as it would not have to reshore any of its production.
Musk was also seemingly responsible for removing a number of controls on investment in China in the most recent government funding bill. Back in December, he personally blew it up out of nowhere with dozens of frantic posts on Twitter/X, and when a new version came through, wouldn’t you know it, the controls were gone.
It similarly comes as no surprise that Musk has repeatedly praised China, and even offered support for its foreign-policy objectives. He has personally met with top Chinese officials and businessmen on many occasions over the years, including Chinese Premier Li Qiang, who personally gave Musk a Chinese green card at Tesla’s Shanghai factory, and President Xi Jinping. In 2022, Musk said Taiwan should be deemed a Hong Kong–style “special administrative zone” of China, for which he was thanked by the Chinese ambassador. In 2023, he said on CNBC there is a “certain inevitability” about China’s goal of annexing Taiwan, and later that year said on a podcast that the island is an “integral part” of China. In 2024, Vladimir Putin reportedly asked Musk to not activate Starlink internet over Taiwan as a favor to China, and later SpaceX told its Taiwanese suppliers to leave the island.
During the 2024 campaign, Trump promised harsh tariffs on China as high as 60 percent or even more. After the election, The Wall Street Journal reported that Chinese officials were hoping that Musk would “ward off” these policies. After taking office, Trump attacked Mexico and Canada instead with 25 percent tariffs (though these have been paused for the moment), while China got just 10 percent. He has also frozen all foreign aid, including to Taiwan. Coincidence? I think not.
It should also be mentioned that Chinese law states that any company operating in China must hand over any data the government wants without question.
Finally, aside from Musk’s titanic conflicts of interest and close ties to hostile foreign powers—which would unquestionably disqualify any ordinary person from even the lowest security clearance—there is the vulnerability he and his adolescent goon squad are creating by making so many wild, abrupt changes.
A big reason that changes to U.S. government computer systems have always been done slowly and carefully is the need to avoid opening up holes in their security systems. Even a small change can let in hackers, from foreign governments to simple criminals. Indeed, the Treasury Department announced in December that it had been hacked by Chinese spies. Letting some fascist tech bro who is convinced everyone but himself is an idiot thrash around in the code of key government systems is so insane that even China itself might think twice about doing so—they’d want to steal data and money, not risk breaking a fifth of the American economy. “This is the largest data breach and the largest IT security breach in our country’s history—at least that’s publicly known,” one federal IT expert told The Atlantic.
America is getting a painful, bludgeoning lesson in why there are so many federal rules around ethics, foreign associations, and security. The government is supposed to be accountable to the people, not the personal plaything of one ultra-billionaire and whatever dictators might be able to twist his arm.
