Is Elon Musk's Goal to Change the US or Strengthen His Own Empire?


Elon Musk took a big risk in the US elections. He supported Trump at a level never seen before in history. I have never seen a businessman get so involved in political elections and frankly, he is reaping the rewards of that big risk he took these days. After Trump was elected, there have been incredible increases in Elon Musk's company valuations. Of course, he is enjoying the increase in wealth that comes from this. For example, Tesla gained an additional value of $300 billion after the elections and exceeded the $1 trillion level. Another company of Elon Musk, Space X, received new investment and its valuation has reached $250 billion. This was around $210 billion before the elections. xAI, which was spun out of Twitter, received a new investment of $5 billion with a valuation of $45 billion. The valuation is also increasing rapidly there and Elon Musk is getting richer. Behind these value increases is the expectation that Musk's new power in management will pave the way for his companies, especially in terms of regulation. But Elon Musk seems to be aiming for even more.

Elon Musk doesn't just want to do things that will be good for his companies. The man behind Tesla, Space X, xAI and Twitter, Elon Musk is now stepping into a completely different role. Reshaping the US government and state. Elon Musk, the richest man in the world, was appointed this week to head a project with Trump's former rival Vivek Ramaswamy, aiming to eliminate government bureaucracy. The abbreviation of the project is "DOGE", yes, it has something to do with the doge altcoin. As you know, Elon Musk loves it very much. There is also a reference to it here, the extended version is Department of Government Efficiency. Elon Musk took over such a department. He has been saying that such a structure is needed in the government for a long time. Because he himself complained a lot about bureaucracy.

The only purpose of the DOGE project is not to reduce bureaucracy, but also to aim for great savings. On the one hand, it aims to ease the regulatory side and eliminate unnecessary regulations, while on the other hand, saving the state $2 trillion. Elon Musk and increasing efficiency. This probably reminds you of something. Remember the Twitter story. Elon Musk bought Twitter for $44 billion. He started incredibly big changes on his first day in office. He quickly laid off about 80% of the workforce. He went into detail about all the company's expenses one by one. He even went into detail about which data centers they used and how much they cost. Rumor has it that he made efforts to increase efficiency by moving the computers himself, when necessary, and thanks to this, he reduced Twitter's expenses by millions of dollars. Guess what happened in the end. While many people expected Twitter to disappear, Twitter is getting more traffic today. They became more creative with fewer employees. They created $45 billion valuations like xAI from their organization. Twitter's revenue models changed. Thanks to the blue tick, it can now collect money from individuals. Musk's personality and worldviews of course created some difficulties for advertisers. Despite the revenue losses from there, Twitter continued to grow.

Musk often has similar projects at Tesla and Space X. There are layoffs, efforts to increase efficiency, and he is constantly trying to kill bureaucracy. We know that Elon Musk does not like middle management levels. He wants to be with people who are working directly in the field, get their opinions, and empower them. He is currently preparing to transfer all these ideas to the US government and manage it like a startup. So why is Musk so passionate about this? Certain rumors say that Musk aims to create benefits for his own companies. This may be partially true. Because Musk has had many problems with the government in his own companies. For example, some of Space X's flights were delayed in California because the governor's office did not allow it, the number of flights was low, or there are certain rules about Tesla's autonomous driving that are pushing it and slowing it down. All these may have worn Musk's patience thin. Therefore, even before these elections or politics, Musk was frequently confronted with bureaucracy and voicing his complaints. He once even said that it takes longer for the government to complete the paperwork for flight permits than it takes for Space X to build a rocket.

So how will 2 trillion dollars be saved? How will this success be achieved in regulations? Of course, these are currently the subject of much debate. Because for a giant 2 trillion dollar saving, America's total budget is around 8 trillion dollars; savings need to be made in areas such as defense, social security and health. Critics say that other areas will not be enough and it seems difficult to touch these areas. Because the expenses in these areas are both socially sensitive, especially in the health sector, and on the other hand, there are serious interest lobbies behind them. It is even said that even some Republican MPs may oppose such projects. Because it may create employment problems in their own states where they get votes. Many people may become unemployed. But we know that it is a bit difficult to stop Musk. For example, when we look at the defense side, he finds the traditional defense industry very harmful. He encountered a similar structure when he got involved in the space business.

Giant companies that receive tenders from the United States, such as Boeing, operate with a method such as cost plus profit. In other words, they first receive the tender. Then they state their costs to the state and add a profit margin on top of this, and the state pays for it. This does not push them to be more efficient or faster. Of course, Musk says that all these works, both in defense and space, should be put out to tender. A price should be given. How much profit it will make from this should be up to the company itself. It may make less profit or more profit, but it will definitely focus on working more efficiently to make more profit, he says. For this reason, for example, it is planned not only to eliminate regulations but also to change certain pricing strategies and contract types, and experts say that there may be great opportunities here.

On the other hand, some critics say that Musk's initiative will also cause massive institutional corruption. They see this as massive corruption. Because it is said that Musk can greatly favor his own companies, and they may be right. For example, Elon Musk currently has the power to flatten the National Highway Traffic Safety Administration, which prevents autonomous driving. Remember, Trump took both the Senate and the House. Therefore, he now has great power, and Musk can use this power and very well use it for his own companies. Although an experience from last week is interesting, the Trump administration is very uneasy about the incentives that electric vehicles receive. He is considering removing them completely. There was a news report on Reuters about this, but Elon Musk says; we want this anyway, all incentives should be removed. In other words, he can stand behind a project that will harm him in the short term at least. Still, of course, some people are concerned that Musk will rewrite all the rules in his favor, and it is possible to agree.

And of course, there is this. Musk has been very successful on Twitter, and Tesla has been very successful. Here, he shows great examples of efficiency management. But in the state, these may not work exactly like this. Because there are laws, procedures, and the state bureaucracy is almost an expert in preventing such initiatives. Therefore, how will these things work within the government? Will it find the necessary support is again a matter of debate. Elon Musk and his partner have creative ideas there too. They say that we will share all savings opportunities with citizens via social media and get their opinions. They also tell citizens to share savings opportunities with them via social media. In this way, he thinks of getting the citizens behind him. Because I am sure that in the US, citizens may say that many expenses are wasted by the government and are spent unnecessarily. Of course, this can cause a bit of chaotic communication. Everyone will look according to their own interests, but here, Musk adopts an open-source Open Source structure. In this way, he aims to get the citizens behind him even if the bureaucracy resists, and of course, to bring transparency to the whole process.

On the other hand, making such big savings will harm the interests of many people. Therefore, Elon Musk also says that his life may be in danger. I agree. We see what can happen when money is involved. As a result, of course, we don't know right now whether Musk's revolutionary ideas will work in the state or will get lost in the wheels of bureaucracy. But it is clear that Musk will give a great fight in this direction and maybe he will use different methods than state administrators, such as Open Source, which I gave as an example a moment ago. It is also clear that he has great support behind Trump. Why are all these important to us? If you are investing in American stocks, your biggest fear is America's state deficits. It has very large deficits. Therefore, the American state is entering into very large debts. This can negatively affect the value of stocks in the long term. Because if the American state does not respond to a call for a borrowing need, there may be a great panic in the markets. In this context, it is very important for the American state's borrowing need to decrease, savings to increase, the value of treasury bonds to increase and confidence in the American dollar to increase.

America has been heavily criticized on this issue for a long time. But now a crazy person like Elon Musk says he wants to solve this problem. He has said many times before that these government deficits are unsustainable. In fact, FED Chairman Powell made similar statements last week. He said that we think government deficits are unsustainable. Therefore, perhaps the time for these savings has long come and gone. When we consider that the American government is the world's largest spending machine, for example, its defense spending is more than the total of the 10 countries that follow it, I am sure that there are many savings opportunities.

But of course, there will be a war with lobbies and groups. It is difficult to convince the citizens. Elon Musk does not have easy days ahead of him. I will continue to follow with curiosity and on the other hand, I will enjoy participating in Elon Musk's companies as an investor. We are having very enjoyable days with Tesla these days. I hope that his other companies will go public in the future and we will participate in them as investors. Because I have never seen this man's fighting power in anyone else and eventually, he will achieve what he says, albeit with delays.

The information, comments and recommendations contained herein are not within the scope of investment consultancy. Investment consultancy services are provided within the framework of the investment consultancy agreement to be signed between brokerage firms, portfolio management companies, banks that do not accept deposits and customers. The comments in this article are only my personal comments and these comments may not be appropriate for your financial situation and risk return. For this reason, investments should not be made based on the information and comments in my articles.

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