The political world is riveted by the bitter feud that has broken out between the richest man in the world, Elon Musk, and the US President Donald Trump. Though the fight feels a bit like pro-wrestling and may not last long, the insults back and forth are mean-spirited and bitter, and were accompanied by threats.

From a market power perspective, there is potential policy fallout. Trump said he might cut Elon Musk’s government contracts, which are largely centred in his rocket company, SpaceX. That’s a big deal, because the company runs much of our space programme. In the last quarter of 2023, SpaceX lifted up 90% of all pounds sent into orbit, which makes it a monopolist in launching satellites. It provides the only vehicle that astronauts have to get to and from the International Space Station.

There’s more. A big part of SpaceX is the communications satellite company Starlink, which has around two thirds of all satellites in space and has a dominant lead in its market, allowing people to get broadband internet with a small dish anywhere on the planet. Starlink is so important that it is a key geopolitical weapon. Musk has made the call to allow or disallow Ukraine from using Starlink terminals for different war-fighting purposes, giving this individual sovereign-level powers.

After Trump threatened Musk this week, Musk responded by saying he would use his power to jeopardise US interests. It’s not clear if he was joking, but even a joke threat makes the point. Decommissioning the Dragon spacecraft would harm the International Space Station and hinder US encrypted communications, some of which flow over Musk’s network.

One result of this fight is that Steve Bannon, a close advisor to Trump, has suggested that Trump use the Defense Production Act — a legacy law from the mid-century that allows the Government to use civilian industrial capacity for national security purposes — to take over SpaceX.

Bannon is correct in his argument. Something like launch capacity to space, especially when it’s a monopoly, or a vital communications network like Starlink, are too important to be controlled by one guy. And it’s government-funded anyway, having received $22 billion in direct federal monies, and more every year, with immense public support in the form of permissions to launch and knowledge built on top of the public space programme.

Bannon’s argument isn’t just about seizing private power. It’s true that SpaceX’s rockets that bring satellites into space are reusable and efficient, and his company has won because its technology is better than rivals such as Blue Origin and Boeing. But there’s also a real monopolisation problem.

Rivals allege two main tactics for the launch part of the monopoly. First, SpaceX allegedly charges below cost in certain contexts to prevent competitors from getting into the market. Second, the company inserts “right of first refusal” provisions with customers, meaning that it has the right to match competitors if they make a better offer. Both of these are classic moves of an aspiring monopolist. There are likely other tactics of course, like rumours that Starlink gets better pricing from SpaceX launches than other rival satellites, which is self-preferencing. And there’s the sabotaging of funding rounds, plus the need for large amounts of capital and regulatory barriers to entry.

So there is a legitimate reason that the Government has to use the Defense Production Act to take over SpaceX, since Musk is threatening to sabotage vital interests over a political spat. Normally, I’d support Bannon’s argument, and also call for an antitrust investigation and action, as that should have happened long ago. But this is the Trump era, and there’s a reason that didn’t happen.

Talking about key national infrastructure in the context of two enormously powerful men calling each other paedophiles on X is extremely weird. We’re in an oligarchy, and nothing screams that as much as this fight. And I will make an observation about how miserable it must be to work in this administration in a political capacity, because keeping your job and/or advancing means expressing zeal for cults of personality that can change at any moment.

Musk’s politics are those of a standard Reagan libertarian — low corporate taxes, free trade with China, bad labour standards, lots of immigration — and he fits in well with the Republican establishment. But he’s both immensely wealthy, and he has a cult of personality almost as big as Trump. Before this fight, the cringe adoration for Musk among GOP officials was overwhelming. For instance, the FBI set up a task force to look at anti-Tesla vandalism, every agency investigating parts of Musk’s empire was dismantled, the FCC and Commerce Department redirected broadband subsidies to Starlink, and trade reps helped Musk’s broadband company get contracts in India, Somalia, the Democratic Republic of Congo, Bangladesh, Pakistan, Vietnam, and Lesotho, using the threat of tariffs as a lever. The State Department even tried to order $400 million of electric armoured cars from Tesla, before being exposed and embarrassed.

I’m not making a corruption argument, though obviously the conflicts of interest here are insane. I’m making a slightly different point. For the last three years, and then increasingly since Trump took office, every Republican official with less than a billion-dollar net worth has been bending over backwards to be as obsequious as possible to Musk. When told to jump they ask how high, they self-righteously attack and ferret out anyone who had anything to do with anything that might slightly annoy Musk. It’s little stuff, like this, which I’m guessing Musk didn’t ask for but some random Trump staffer thought might get him a promotion or a positive word from the boss.

Since they don’t know what they want in terms of a governing agenda, and they aren’t getting clear direction, Trump officials are just trying to please the most powerful cult of personality they see. They are acting out of fear, a constant sense of exhaustive social climbing.

And now, everything that these people have done, all the worshipping of DOGE and Musk, all the extra subsidies they’ve tried to slip Musk’s way, is that for nothing? Have the rules changed? Will they now be criticised for what they thought they were supposed to be doing?

That’s one of the problems with oligarchy. It really is arbitrary, and it sucks for everyone, not just those victimised by the vagaries, but even for those working for the oligarchs. That is one reason the rule of law matters and why institutional integrity is useful. Being at the utter whim of powerful men who can change their mind whenever, without consequence, is a terrible way to run a country. It took us 1000 years to develop democratic systems and get us away from this kind of arbitrary and capricious behaviour. Hopefully we’ll start to remember what we have before we lose it.

In the meantime, we should treat SpaceX and Starlink like the public utilities they are. And if Trump really wanted to go after Musk, he’d send the Federal Trade Commission after SpaceX to look at some of its contracts and pricing choices. But we’re some distance away from that, even if an enterprising state official might be able to do it.

This is an edited version of an article which first appeared on Matt Stoller’s Substack.

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Matt Stoller is the Director of Research at the American Economic Liberties Project. He is the author of Goliath: The Hundred Year War Between Monopoly Power and Democracy.

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