{"id":115490,"date":"2024-11-17T14:15:33","date_gmt":"2024-11-17T14:15:33","guid":{"rendered":"https:\/\/quixnet.net\/wpinstance\/before-elon-musk-trump-tapped-another-billionaire-to-cut-costs-it-didnt-end-well-usa-today\/"},"modified":"2024-11-17T14:15:33","modified_gmt":"2024-11-17T14:15:33","slug":"before-elon-musk-trump-tapped-another-billionaire-to-cut-costs-it-didnt-end-well-usa-today","status":"publish","type":"post","link":"https:\/\/quixnet.net\/wpinstance\/before-elon-musk-trump-tapped-another-billionaire-to-cut-costs-it-didnt-end-well-usa-today\/","title":{"rendered":"Before Elon Musk, Trump tapped another billionaire to cut costs. It didn't end well – USA TODAY"},"content":{"rendered":"

WASHINGTON \u2013 Long before Elon Musk took on the mission of demolishing government waste, President-elect Donald Trump had another favorite billionaire, Carl Icahn, whom he tapped in 2017 to streamline government regulation during his first year in office.
It didn\u2019t end well.
Icahn, a famed corporate raider with a Fifth Avenue office two blocks away from Trump Tower, lasted seven months as Trump’s unpaid adviser on regulatory reform. The blunt businessman resigned amid a swirl of ethical questions over changes to a longstanding energy policy that he could have profited from.
His company wrote in an SEC filing that federal prosecutors were investigating the matter in Nov. 2017, but no charges were ever leveled.\u00a0
Icahn denied wrongdoing. But critics, including Democratic lawmakers in Congress cried foul, saying he appeared to be personally profiting \u2212 and helping out cronies in the oil industry \u2212 at the expense of taxpayers.
Sign-up for Your Vote:<\/strong> Text with the USA TODAY elections team.<\/a>
Now Musk, the world’s richest man, has taken on the mantle of government reform<\/a> and, with billionaire businessman Vivek Ramaswamy<\/a>, will lead Trump’s Department of Government Efficiency, or DOGE, a non-governmental body the President-elect has tasked with cutting waste and making Washington work better and faster.
On Thursday, the DOGE account on X (formerly Twitter), called out for “super high-IQ small-government<\/a> revolutionaries willing to work 80+ hours per week on unglamorous cost-cutting.”
More:<\/strong>Musk asks \u2018high-IQ revolutionaries\u2019 to work for Trump project without pay<\/a>
Whatever Musk’s zeal, the ethical pitfalls of his appointment are exponentially greater than those Trump faced with his old friend Icahn, said Richard Painter, the chief\u00a0White House ethics lawyer<\/a>\u00a0for President George W. Bush, a Republican.
“You’ve got a billionaire who is politically very close to the president of the United States, who has a dominant position in social media, electric vehicles and a private space program, among other things, who’s going to be put in charge of reducing spending and increasing efficiency in just about every single government agency,” Painter told USA TODAY. “It’s obvious that there are very, very broad conflicts of interest here.”
USA TODAY reached out to Musk, Ramaswamy, the Trump campaign \u2212 and Icahn \u2212 for comment but none responded.
Trump said the DOGE will “provide advice and guidance from outside of government,” partnering with the White House and Office of Management and Budget “to drive large-scale structural reform” throughout the federal government. He said the team’s work will conclude no later than July 4, 2026.
The SpaceX founder and Tesla CEO, whose companies have been awarded\u00a0at least $15.4 billion in federal government contracts<\/a>\u00a0over the past decade, has said he can cut $2 trillion from the federal budget. At the same time, he’s said publicly that he is relying on the Trump administration to help him realize his dream of colonizing Mars.
Musk’s companies, which also include brain implant company Neuralink<\/a> and the Boring Company<\/a>, are regulated by numerous federal government agencies that he’s now tasked with streamlining. That means Musk likely would be recommending changes in agencies that have cost him plenty in fines and penalties.
More:<\/strong>Trump taps Elon Musk, Vivek Ramaswamy to lead new ‘Department of Government Efficiency’<\/a>
According to Good Jobs First, a national policy watchdog, Tesla has been forced to pay nearly $100 million in 73 enforcement actions by the Justice Department, the Securities and Exchange Commission, the Environmental Protection Agency, the Labor Department and the Occupational Safety and Health Administration.
Musk \u2212 and Ramaswamy \u2212 also could propose policy changes that allow them to save huge sums of money by cutting red tape and regulations designed to protect consumers and the environment.
Good Jobs First’s tally shows SpaceX has been penalized $4.2 million over safety, labor, environmental and aerospace violations.
In the runup to the Nov. 5 election, Musk befriended Trump and used his wealth, influence and the giant platform of X, where he has nearly 205 million followers, to help him defeat Democrat Kamala Harris and win a second term.
In return, Trump called Musk his \u201crock star\u201d and promised to give him extraordinary leeway in deciding what government programs and regulations to whack.
In doing so, Trump appears to be giving Musk and Ramaswamy the authority to recommend deregulatory or budget-slashing actions that could directly benefit their companies. How much so nobody knows, except maybe Trump, Musk and Ramaswamy given how few details of the arrangement have been publicized.
But if Icahn\u2019s case is any guide, the two billionaires (Ramaswamy is worth an estimated $1 billion<\/a> from his Roivant Sciences pharmaceutical company) are likely to run into very real conflicts of interest.
And given Musk\u2019s vast portfolio, his potential exposure is far greater than Icahn’s was.
Like Musk, Trump had a personal relationship with Icahn before tapping the high-profile billionaire investor to serve as a special adviser to him before even taking office. Months earlier, Icahn\u2019s investment firm bought Trump Entertainment Resorts after the struggling casino operating company exited\u00a0bankruptcy for the fourth time.
\u201cWall Street maven Carl Icahn will advise President-elect Trump on matters of regulatory reform, giving the famed investor a key say in how his own industry is monitored,\u201d USA TODAY<\/a> reported Dec. 21, 2016.\u00a0
Icahn was to advise Trump on regulatory topics as an individual, not as a federal employee\u00a0\u2013 and he wouldn\u2019t have any specific responsibilities, according to a press release from the Trump transition team at the time.
But it was clear from both Trump and Icahn that his mission \u2013 like Musk\u2019s and Ramaswamy\u2019s \u2013 was to dramatically slash rules.\u00a0
\u201cUnder President Obama, America\u2019s business owners have been crippled by over $1 trillion in new regulations and over 750 billion hours dealing with paperwork,” Icahn said in a statement released by the Trump transition team. “It\u2019s time to break free of excessive regulation and let our entrepreneurs do what they do best: create jobs and support communities.”
From the outset, his role raised significant concerns about conflicts of interest because of his extensive business holdings, particularly in energy-related industries subject to strict federal regulations.
The Democratic National Committee called Icahn’s appointment a “quid-pro-quo 25 years in the making.”
“It’s a little like asking the fox to guard the hen house,”\u00a0Andrew Stoltmann, partner at securities law firm Stoltmann Law, said at the time.
Icahn’s investment in CVR Energy, an oil refining company, was seen as a potential conflict, especially when he advocated for changes in biofuel regulations that could benefit the firm and others in the refining industry.
That led to scrutiny from lawmakers.
In May 2017, eight Senate Democrats wrote to federal financial and environmental agencies seeking a federal investigation into whether the billionaire activist investor influenced the Trump administration in ways that would drive down the price of renewable fuel credits.
Trump’s White House sought to distance itself, saying Icahn’s role was an informal one<\/a>, as “a private citizen whose opinion the president respects and whom the president speaks with from time to time.”
On Aug. 17, 2017, Icahn resigned, just four days before The New Yorker magazine published a 12,000-word bombshell article titled “Carl Icahn’s Failed Raid on Washington<\/a>.” Among its claims were that Icahn tried to leverage his advisory position and relationship with Trump to influence U.S. environmental regulations for his own \u2212 and his industry’s \u2212 financial benefit.
In a letter to Trump, Icahn said that “contrary to the insinuations of a handful of your Democratic critics, I never had access to nonpublic information or profited from my position, nor do I believe that my role presented conflicts of interest.”
In the current case, the objectives of the new DOGE \u2013 so named after the Dogecoin cryptocurrency championed by Musk \u2013 focus on scrutinizing federal operations and recommending reforms to reduce waste and improve efficiency.\u00a0
That could present Musk with a wide array of conflicts of interest given his substantial holdings in companies involved in energy, transportation, space exploration, military and intelligence.
Notably, all eight of the senators who raised questions about Icahn are still in office. One of them, Sherrod Brown, lost his bid for re-election and will be leaving the Senate in January.
But another, Elizabeth Warren of Massachusetts, has already sparred with Musk.
“The Office of Government Efficiency is off to a great start with split leadership: two people to do the work of one person. Yeah, this seems REALLY efficient,” Warren posted on X.
Musk’s reply: “Unlike you, neither of us are being paid, so it is very efficient indeed<\/a>.@DOGE<\/a> will do great things for the American people. Let history be the judge.”
Like Painter, Danielle Brian — the executive director and president of the Project On Government Oversight — is concerned that the DOGE is rife with potential conflicts of interest.
“I think there’s a really great comparison,” between the two cases, Brian said Friday.
“The question in that case was that Carl Icahn seemed to take the public outrage seriously enough that he stepped down,” she added. “I don’t see Musk having the same sense of shame that Icahn did eight years ago.”<\/p>\n

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