Elon Musk isn\u2019t the only tech billionaire with power over the federal agencies that regulate his businesses. Since Donald Trump took office, more than three dozen employees, allies, and investors of Musk, Peter Thiel, Marc Andreessen, and Palmer Luckey have taken roles at federal agencies, helping direct billions in contracts to their companies.\u00a0<\/p>\n
Companies owned, founded, or invested in by Musk, Thiel, Andreessen, and Luckey have collected more than a dozen federal contracts totaling about $6 billion since Trump\u2019s inauguration in January, according to a Wall Street Journal analysis<\/a>. And they\u2019re actively pursuing billions more.\u00a0<\/p>\n Those appointments, which are in departments that oversee, regulate, and award business to the four men\u2019s companies, raise a number of red flags. They could violate conflict-of-interest laws or government ethics regulations, both of which prohibit federal employees from using public office for private gain.<\/p>\n And while it\u2019s not unusual to install trusted allies in government roles, Musk\u2019s network has moved in at an unprecedented rate and scale. TechCrunch has previously reported on all of the people in Musk\u2019s universe<\/a> who have joined him at DOGE, where he has shuttered federal agencies and slashed workforces in departments that regulate his businesses. At least 19 others<\/a> with Silicon Valley connections, be they founders or investors, have also joined DOGE.\u00a0<\/p>\n \u201cThe second Trump administration is actually the first in recent years to not impose any sort of additional ethics safeguards on high-level appointees,\u201d Daniel Weiner, director of the Brennan Center\u2019s Elections and Government Program, told TechCrunch. He noted that Trump fired<\/a> the director of the Office of Government Ethics and 17 inspectors general who served as watchdogs for fraud and abuse, immediately after taking office.<\/p>\n \u201cIt certainly does potentially increase the risk that you have people working on matters that do impact, at least indirectly, their bottom lines,\u201d Weiner said. \u201cBut this is a long-term issue in our government that\u2019s not unique to this administration.\u201d<\/p>\n Some may argue that it makes sense for employees and associates of Musk, Thiel, Andreessen, and Luckey to join government agencies. Their insiders are talented individuals who are behind the cutting-edge technology the government genuinely needs, and they understand how to innovate quickly and compete globally.\u00a0<\/p>\n More serious questions arise when favoritism threatens to undermine competition, when policy is created or destroyed to protect market dominance, or when regulations that would serve the public good are waylaid to promote business interests.\u00a0<\/p>\n For instance, the Consumer Financial Protection Bureau recently retreated from pursuing rules that would restrict data brokers, despite growing privacy concerns \u2014 a shift that stands to benefit companies involved in AI, surveillance, and data analytics. Another example is DOGE\u2019s firing of staffers at the National Highway Traffic Safety Administration<\/a> who investigate autonomous vehicle safety, including several probes into Tesla.\u00a0<\/p>\n \u201cOne of the defining structural challenges the government of the United States has right now is that we have a system in which the very wealthiest interests have so much power to shape our elections and then turn around and shape government policy,\u201d Weiner said.\u00a0<\/p>\n Another Silicon Valley appointee, Mike Kratsios \u2014 a former Thiel employee \u2014 is now leading technology policy for the U.S. government. In an April speech, he spoke about throwing away bad regulations that \u201cweigh down our innovators,\u201d particularly those who are innovating in AI.\u00a0<\/p>\n \u201cMany people in Silicon Valley tend to think that whatever worked in Silicon Valley is also going to work for administering the United States government,\u201d Weiner said. \u201cAnd as we\u2019re seeing now, the danger is a lot of people are going to get hurt because of the assumptions they make.\u201d<\/p>\n \u201cThe fact that you had a successful startup after five others failed doesn\u2019t necessarily mean you know how to run the Social Security Administration,\u201d he continued.\u00a0<\/p>\n All of the businesses between Musk, Thiel, Andreessen, and Luckey are related. Musk\u2019s SpaceX was backed by Thiel\u2019s Founders Fund and Andreessen\u2019s a16z (which also invested in X and xAI). Both of those VCs also backed Anduril, Luckey\u2019s defense startup.\u00a0<\/p>\n The overlapping network of founders, funders, and insiders extends into several federal agencies. And in many cases, those agencies are steering billions in federal contracts back to those companies.\u00a0<\/p>\n The Journal found that across Washington, people from Musk\u2019s network, including Tesla, X, and SpaceX, are in more than a dozen agencies, from the executive office of the president and Office of Personnel Management all the way down to the Department of Transportation and the Department of Energy.<\/p>\n SpaceX employees are also in agencies that could provide the company new business. For example, the Journal reports that SpaceX senior engineer Theodore Malaska got an ethics waiver in February that lets him take a temporary job at the Federal Aviation Administration while still working at the rocket company. The FAA hasn\u2019t given any contracts to SpaceX yet, but Malaska said on X<\/a> the agency has used Starlink to upgrade a weather-observing system in Alaska.\u00a0<\/p>\n SpaceX is also the main commercial provider that transports crew and cargo for NASA. Despite national security concerns \u2014 like the company\u2019s secret backdoor for Chinese investment<\/a> and Musk\u2019s reported drug use <\/a>\u2014 SpaceX in April won $5.9 billion<\/a> of a $13.7 billion multi-year contract from the U.S. Space Force to launch Pentagon missions. The DOD, which is currently a Starlink customer, also plans to buy SpaceX\u2019s Starshield satellites<\/a>, a militarized version of the internet satellites.\u00a0<\/p>\n Employees at Thiel-backed firms have found themselves in roles in the State Department, the Office of Management and Budget, Health and Human Services, and Social Security, per The Wall Street Journal. Thiel\u2019s Palantir has already been awarded nearly $376 million since 2020 from the Department of Health and Human Services. In 2024, the company was also awarded<\/a> at least $1.2 billion<\/a> in Department of Defense<\/a> contracts<\/a> in 2024 and is in the running for another $100 million deal<\/a>.<\/p>\n Anduril, Palantir, and SpaceX recently submitted a multibillion-dollar proposal for Trump\u2019s \u201cGolden Dome\u201d missile-defense program, which would also add to Anduril\u2019s existing contracts with the U.S. Army. Recently, Anduril and Microsoft took over a 2021 contract worth up to $22 billion to develop AR headsets, per the Journal.\u00a0<\/p>\n An Anduril executive, Michael Obadal, has been nominated to a top role at the Department of Defense. In his ethics disclosure, he stated that he would retain his Anduril stock<\/a> if appointed.<\/p>\n TechCrunch has reached out to Anduril, Andreessen Horowitz (a16z), Palantir, and SpaceX for comment.<\/p>\n \u201cThis sort of concentration of private wealth and political power is ultimately very risky for our economy,\u201d Weiner said. \u201cBecause instead of the government making decisions that are intended to foster competition, foster economic growth, you run the real risk that government decisions are going to instead be structured around protecting particular companies and particular industries from full economic competition.\u201d\u00a0<\/p>\n<\/div>\nInnovation versus accountability<\/strong><\/h2>\n
A network inside and a payoff outside<\/strong><\/h2>\n
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