U.S. President Donald Trump has strongly criticized Elon Musk’s announcement to launch a new political party, calling the idea “ridiculous” and “confusing.”
Trump Rejects Musk’s Bold Political Move
Trump’s comments followed Musk’s announcement that the “America Party” had been formed in response to Trump’s recently passed spending and tax cut measure.
Trump voiced his displeasure with the decision to reporters prior to boarding Air Force One in Morristown, New Jersey. “I believe that forming a third party is absurd. With the Republican Party, we are very successful. “It’s always been a two-party system, but the Democrats have lost their way,” Trump said.
Trump emphasized that the United States works best under its current two-party structure. “Starting a third party just adds to confusion,” he continued. It truly appears to have been created with two parties in mind. Third parties have never worked, so he can have fun with it, but I think it’s ridiculous.”
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This statement came just one day after Musk publicly revealed his new party initiative. The billionaire entrepreneur had criticized Trump’s new economic legislation, calling it dangerous and claiming it could lead the country into bankruptcy.
Musk’s “America Party” Sparks Reactions from Investors and Officials
The news of Musk’s new party has sparked a flurry of reactions in both commercial and political sectors. The move appears to be a direct challenge to Trump’s influence within the Republican Party, especially after Musk criticized the “big, beautiful bill” – the tax and spending legislation Trump recently signed into law.
According to Musk, the America Party aims to oppose Republican lawmakers who supported the controversial bill. He even hinted that his new party will attempt to unseat them in the upcoming midterm elections.
The bill, which passed Congress with only Republican support, focuses on tax cuts and increased spending for national defense and border security. Critics argue that the bill will cause a sharp rise in the federal deficit and hurt the U.S. economy.
Musk, who had earlier been a key adviser to Trump in reshaping the federal government during the start of his presidency, has now clearly broken ties. He stated that the bill’s economic impact and its reduction of green-energy credits for electric vehicles – including Tesla’s – were key reasons for his decision.
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The disagreement between the two former allies has led to wider consequences. Azoria Partners, an investment firm preparing to launch a Tesla-focused exchange-traded fund (ETF), announced on Saturday that it would delay the fund’s release. The company pointed out that Musk’s political activities conflicted with his responsibilities as CEO of Tesla.
Concern regarding Musk’s changing priorities was expressed by James Fishback, CEO of Azoria Partners. “I urge the Board to convene immediately and request that Elon elucidate his political aspirations and assess if they align with his full-time responsibilities to Tesla as CEO,” Fishback wrote in a post on X (previously Twitter).
He later added, “Elon left us with no other choice,” confirming the decision to postpone the ETF.
Political Fallout and Industry Pushback
Several industries are feeling the financial and political effects of Musk’s statement. In an interview with CNN on Sunday, U.S. Treasury Secretary Scott Bessent also offered his thoughts. He implied that the board members of SpaceX and Tesla probably don’t appreciate Musk’s political ambitions and would rather he concentrate on managing his businesses.
Bessent stated, “I assume those boards of directors were not pleased with this announcement yesterday (Saturday) and will be urging him to concentrate on his business endeavors rather than his political activities.”
Trump, however, claimed that Musk was angry that the new measure eliminated green-energy incentives that help Tesla’s operations. He even warned that the federal government might reconsider the billions of dollars in contracts and subsidies given to Tesla and SpaceX.
In the past, Musk had provided substantial support for Trump’s 2024 re-election campaign. He also made multiple appearances at the White House. But the disagreement over the spending bill appears to have caused a serious break between them. Musk had even attempted to reconcile, but reports suggest his efforts were unsuccessful.
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The Democratic National Committee reacted quickly to the fallout between Trump and Musk. “Trump’s MAGA party is tearing apart in the wake of his nightmare budget bill,” stated party spokesperson Abhi Rahman. Republicans are awakening to the fact that they have just committed their own transgressions and are looking for someone else to place the blame on.
The formation of the America Party, while still new, has already disrupted alliances and raised significant concerns among investors, politicians, and corporate leaders. For now, the political landscape appears increasingly divided, with the clash between Trump and Musk taking center stage.