Well, Elon Musk gives now the richest person on the planet. More than half the satellites in space are owned and controlled by one man, starting his own artificial intelligence company.
Well, he's a legitimate, super genius. Legitimate, he says.
He's always voted for Democrats, but this year it will be different. He'll vote Republican.
There is a reason the US government is so reliant on him.
Elon Musk is a scam artist and he's done nothing.
Anything he does is fascinating the people. Welcome to Elon Inc. Where we discuss Elon Musk's vast corporate empire, his latest gambits and antics, and how to make sense of it all. I'm your host, Joel Webber, sitting in for David Papa Duplass. It's been the talk of the town, so to speak, for these last few days. On Saturday night, The Wall Street Journal dropped his story detailing Elon musk alleged drug use over the past few years and discussed how it has or hasn't impacted his businesses.
After a report from The Wall Street Journal claimed legal drug use was the cause of some of Elon Musk's questionable behavior and executives are concerned about the impact on his companies, including Tesla and SpaceX.
Musk has admitted to drug use before, and of course smoked weed with Joe Rogan that one time during a taping of Rogan's podcast, so this wasn't exactly news, but the anecdotes raise important questions like could this impact Musk's status as a federal contractor, especially given how much business SpaceX does with the US government. And we'll dig into
another headache for Musk and SpaceX. Last week, the National Labor Relations Board issued a complaint over the twenty twenty two firings of SpaceX employees who were critical of Musk's tweeting. SpaceX has since sued the NLRB in an attempt to halt the case. To discuss this and more, will convene Lauren gret Us, Bloomberg's expert on all things SpaceX.
Hi, Lauren, Hi, thanks for having me.
Dana Hole, the world's most tenacious Tesla reporter. Hi, Dana, good morning. And Max Chafkin, senior reporter at Bloomberg Business Week. Hello. Okay, Lauren, I'm going to start with you. What did this article say and was there anything newsworthy in here? For you.
I would say the biggest things that stood out to me having covered SpaceX and this saga for some time was an all hands meeting that occurred in twenty seventeen
in which some executives were concerned about Elon's behavior. Apparently he was slurring, and about fifteen minutes into the all hands Gwynn shot well, the president of SpaceX supposedly had to step in and take over the all hands meeting, and then I think most of the article referred to or reference the twenty eighteen Rogan podcast incident, which I think a lot of people are familiar with, in which Elon Musk, you know, openly smoked something on Joe Rogan's podcast.
It's thought to be marijuana, And that was a little more direct and that we all saw that happen, but that one was well documented at the time. There was a lot of fallout from that. SpaceX or NASA, you know, got concerned. They did an audit of SpaceX and Boeing's safety cultures in the wake of that incident.
Okay, you mentioned what happened on the Rogan podcast. We're just going to play that episode so that everybody can hear it went down.
So is that a joint or is it a siga?
It's no, okay, it's marijuana inside of tobacco.
Okay, so it's like plot tobacco.
You never had that?
Yeah, I think I tried one once.
Come on, man, you probably can't because stockholders.
Right, I mean it's legal, right.
I think we call that a blunt Dana. So, Dana, how do you feel like Wall Street journal reporting and story compares to the incident that Elon waded through when he was on that Rugan podcast.
Yeah, well, the timing of this is very interesting to me. You know, twenty eighteen, Elon's companies were in a very precarious position. SpaceX had not yet flown astronauts to the space station. Tesla was struggling to ramp up the Model three, and the guy was like exhausted trying to keep both businesses afloat. It was like a really precarious time. And then the Joe Rogan thing was just like the stupidest thing he could have done. Five years later, he's like
the richest man in the world. Both companies are doing great. SpaceX is the dominant launch provider, Tesla is like the best selling ev maker in the world. Next to BYD. From where I sit, like Musk amplifying anti Semitism had a far more severe market impact in terms of like stockholders being upset, pension funds writing letters, the stock actually moving. Then, Like this story about drug use, and I mean, I hate to be to break it to like the school arms and the audience, but a lot of people in
tech and finance do drugs like a lot. It is a thing like and it's and I'm not trying to excuse the behavior, but you know, like Steve Jobs openly talked about how doing LSD like helps him become this creative genius. And I think that for Musk's fans, the fact that he is running all these companies while potentially being on drugs is like another sign of how he's this like incredible genius and blah blah blah, and it just sort of feeds into his aura.
Okay, so there's you know, things that he've used before that had been known the ambience, the cannabis, but max LSD, cocaine, ecstasy, mushrooms, ketamine, some of which are you know, keine in particular, he seems to have a prescription to help him do his thing with but aren't those isn't that a different nature of drug use when we were going into some illegal territory there.
I mean, I think kind of what Dan is getting at, like, none of this is outside of the norm in Silicon Valley. And if the Texas as described by the Wall Street Journal, which is a handful of isolated incidents, a Rogan he smoked a doobie on the Rogan podcast, he like takes some ketamine. There was a party at Art Basel, It isn't that much. And I think they're really like two
possibilities here. One is Elon Musk is doing a lot of weird stuff online and we talk about it all the time, and some of this stuff is damaging, and one way to talk about that if you are a Tesla board member, a SpaceX board member, or a critic, is to blame something like drug use. The other possibility is maybe there's more to this story that was unreported,
and like that's kind of what Dana is hinting at. Like, I guess that's the other possibility, but as it exists now, it just doesn't seem all that damning.
I'm going to bring up his response, which he posted on X on Monday, whatever I'm doing, I should obviously keep doing it. And then he responded to himself a little bit later or actually just another user, and said, if drugs actually helped improve my net productivity over time, I would definitely take them. So let's see, he is a drug user and is using them a lot. How does this go over with his people? I mean, the way you read that's funny.
It sounds like he said as he took a long drag from a healthy joint.
It's hard to say.
I mean, I think he's we should also proviso like it is not good to violate federal contracting rules if you are a federal contractor. But on the other hand, it's very hard to see the US government taking any kind of serious corrective action because, of course, as we've talked about many times, they need SpaceX and and people are not necessarily calling into question rockets. And also, newsflash, not a huge surprise that Elon Musk is not respecting laws, norms, or regulations.
Dan, do you think there's any version of key man risk here? Key man risk being a term that we talk about in corporations a lot around corporations, right, if if there is a CEO who can no longer or do his job or her job, perhaps the company that puts the company at risk. Do you think that there's any version of this that key man risk plays out over this scenario.
Well, so you know Tesla and their regulatory filings always talk about key man risk. I mean they always say we are highly dependent on the services of Elon Musk, who was not our full time CEO and runs several other companies. And so yeah, I will like roll over if like the next you know ten if the ten K says and like our CEO is a drug addict and there's a key man risk that he might go to rehab and we'd be without like a CEO. I
mean that would be amazing. Elon is just not a typical CEO, And I think that the trap that a lot of journalists frankly fall into is like we're trying to like establish these norms for him when he has broken all the norms and been wildly successful at it, and investors care about one thing and that is the
return on their money. Like since he smoked pot on the Joe Rogan Show, which we all know was like a big deal, that really like hurt his reputation hurt his standing with NASA caused this big fear, Like the stock has returned I didn't even check. I don't know, like what like twelve hundred percent. I mean so like fundamentally his the investors are like they are used to him being a weird guy.
I love that Dana is a four twenty friendly money manager.
Over here saying.
Ever since he started smoking weed, is the performance has improved?
You know, that's not to say that the I mean, clearly, it seems like the board has concerns. So you know, I would love to know more about, like what exactly were the concerns. But I mean, obviously I'm not trying to be like, do drugs. Drugs are great, But I'm just saying that, like a lot of people in power use drugs, and a lot of people in power also use alcoholic as though.
If the financial performance turns around, then the story changes completely. And Danna Strander wrote a story about this the other day and made the point that like this is going to wind up in shareholder lawsuits and Andy by going around talking about how fun it is to mix red wine and ambient, you're essentially giving ammunition to critics. If
the stock ever takes a dive. Right now, We've got a great Now, anyone who wants to explain why companies aren't performing well, if they stop performing well, has a great story to tell.
I mean, you'd have to really prove that it was because of the drug use. You'd have to like prove that, like he made a critical decision that was bad for the company because he was on drugs at the time.
Laurena, I want to bring it back to you because if there were one company that seemed like it might have to deal with this a little bit more than anybody else, it would probably be SpaceX because of the federal contracts the company has. And one thing that's different now than in the broken episode was that, as I think Dani alluded to earlier, this is how the US
gets astronauts to the International Space Station. So what might happen and unfold at SpaceX or between SpaceX and you know, any sort of drug testing that might have to go down.
Well, I think you kind of pointed out there's two key things that I want to bring attention to, and why it's different now and why I think the response will be different. Back in twenty eighteen, SpaceX hadn't launched people.
Yet, so there was still concern about whether.
Or not this was a good idea using commercial companies to actually launch astronauts in the International Space Station. And so when he took that drag, you know, they were thinking, Okay, maybe we do one last gut check in terms of this space the safety culture at these companies, and so
that was really what prompted it. Now SpaceX has proven that it can safely deliver astronauts to and from the International Space Station on a routine basis, so giving up that capability is going to be extremely difficult.
The other thing that I think is different is.
That we saw him take the hit on the Joe Rogan podcast, like we had direct evidence that he did that, Whereas with this Wall Street Journal story, they're referencing that twenty seventeen all hands meeting and they even said in the story it could.
Not be determined if the reason for his slurring was.
Drugs, And SpaceX did post what appears to be the all hands that was referenced in the Wall Street Journal article. And having covered Elon for a long time, I watched that video and it seemed pretty standard awkward public speaking Elon to me, But I you know, I can't determine what was going on before he took the stage in that video.
But point being, I don't think we have a direct.
Piece of evidence as we did with the Joe Rogan podcast to prompt another substantial audit like NASA did back in twenty eighteen.
Is it clear if Elon has ever taken a drug test and or passed or failed a drug test? Max they've said he has.
I think our assumption is that he has and he's passed. If I'm wrong, please correct me.
Jenna.
He tweeted that he has right. He tweeted that he like was tested randomly tweeted or x X I'm sorry X that he's okay, okay, randomly drug tested at SpaceX for three years and always passed with flying colors. I mean, you know, I don't know how. I don't know when the most recent test was. I have no idea.
Okay, Now we're going to focus on SpaceX and some dueling stories that involve the National Labor Relations Board. The NLRB issued a complaint about SpaceX and a labor situation there, and is scheduled to hear that case in March. SpaceX has since sued the NLRB, saying the agency is unconstitutional and the suit should be dismissed. All of this relates to a story that Lauren Grush broke for The Verge before she joined Bloomberg. So Lauren, we're going to start with you.
Yeah, So that was a very intense week back in
twenty twenty two. Basically I was going home for the day, which is when you get your best tips, you know, and someone leaked to me that there was an internal letter going around within SpaceX and it was a letter posted to their Microsoft Teams channels, and that it was pretty critical of Elon and they were saying, you know, I think the line that I kept pulling for stories was that he was a frequent source of embarrassment for the company and that they were calling on SpaceX to
distance itself from his public comments that they should be better about sexual harassment.
How did the company respond.
Yeah, So it was the letter was up for about a day and a half before they pulled it down from the team's channels. And then after we published our report, I started to hear that a bunch of the people associated with the letter were getting fired. And then Gwynn Shotwell sent out an email to the company. Really really cule your email, in my opinion, because it was basically
saying that these rogue employees. I don't remember the exact text, but it was like these rogue employees were distracting all of their coworkers and harassing them by telling them to sign on to this this letter. You know, it is a really very aggressive email painting a negative picture of the employees.
And so it was a saga that ended.
Very quickly because they swiftly fired the employees.
And then after that we I spoke with some.
Of the employees who were involved and they told me, you know, how many people actually signed on to the letter before it was taken down. It was hundreds of employees. But then yeah, after they were fired, they were discussing, you know, whether that was actually a lawful move for them to be terminated because they were simply expressing concerns about their workplace conditions.
And shotwell, chief operating officer for SpaceX, what is the most recent news then that's come out, because that was everything that went down. There was twenty twenty two. So here we are now twenty twenty four. National Labor Relations Board files this complaint which is technically its first move. What does that complaint say and how has SpaceX responded?
Yeah, so essentially it confirms what the employees were thinking is that they were illegally fired for voicing concerns about their workplace conditions. And given the fact that Elon Musk is the CEO of the company, you know, what he says and does can be considered, you know, affecting people's
workplace and how they performed that job. And then not very long after the complaint was issued, SpaceX sued the And this is the part where it gets a little wonky, but essentially they were saying that the way that the NLRB is structured is unconstitutional, and so they're trying to
basically get out of it. But what was really interesting about that lawsuit is SpaceX alleges that, you know, the letter was a source of distraction for SpaceX employees, and that the employees who were fired were fired for violating various company policies. They didn't go into detail about it, but that's that is their defense. That's the biggest defense I've seen from SpaceX since this whole thing went down.
Louren, as best as you can tell, what's the vibe within SpaceX right now.
I think the vibe, to be honest, is that everybody's kind of putting their heads down and working. You know, this was probably the first time I had seen employees within the company openly speaking about Elon, and it sadly confirmed a lot of their fears, which is that if you do that, you'll get fired. And so I think the vibe within the company is that they're just.
Not going to do that anymore.
You know, if they do, I will be surprised, will happily report on it. But yeah, I think it confirmed most people's suspicions that, you know, you can't speak up against the boss, You'll you'll be in trouble.
The reaction is also just sort of classic in that now SpaceX is suing the NLRB basically saying that what they're doing is like unconstitutional overreach and really going like guns blazing at the agency itself, which is, you know, another another sort of tactic that Elon has never shied away from using. He thinks that regulation is run amok and there's too many rules, and they're going to really go all out after this agency.
And I gotta say, I do think talking about these two stories kind of in tanem is instructive. You mean the drug use plus this one hundred percent, yeah, Because on one hand, you know, there's this kind of like divide where where there's like the weird stuff Elon tweets and the stuff weird stuff, he says, and then the stuff
he actually does. And I really think we spend probably and not just us, but investors and everybody spend probably too much time talking about this, says versus the and he you know, here we have some like legitimately bad behavior, right, we have credible allegations of sexual harassment. There was also an earlier allegation made by some SpaceX interns of sexual harassment at the company. Yes, and the response yeah, and the response was, you know, basically to shut it down
to dictatorial. It's it's basically the opposite of what Elon Musk says. He is, you know, you had you had employees who seem to be and maybe I'm maybe I'm putting too much on them, but and Lauren can correct me, but seem to be raising number one legitimate questions in a way that doesn't doesn't seem from the outside to be not constructive. It seems like they were attempting to address this real issue. And yeah, and they were and
they were squashed, right, And that's concerning. And I'd say I'd argue more concerning from like a perspective of safety and all the things, the other reasons you might be worried about Elon must drug use. This should concern you because like what happens if there's a legitimate if there's a door faull not to you know, make the Bonweing comparison, but right there's the doors falling off of these Boeing jets. You know what happens if there's a similar safety problem
you have employees calling attention to it. You want to have reporting mechanisms. You don't want to have a company that just shuts down any descent. It's really bad at any company, and it seems especially bad at a company like SpaceX and DAN.
If there is one thing that sort of linked thematically some of Elon's company, it would seem to be labor relations and sort of the poor state of them. There's SpaceX and X obviously when it went through the transition from Twitter Tesla, we've had multiple in the LRB stories there. What about the other ones in his universe, you know, the Neuralink and the Boring. Is there anything else out there?
Well, I guess I would just say that I think that fundamentally, a lot of employees really take pride in their work, particularly engineers. I mean, these are mission driven companies.
That have within Elon's companies.
In Elons companies, yeah, I mean, these are mission driven companies and people are really drawn to the mission, and people really like working there in general, and they where the SpaceX jackets and the Tesla ball caps, and like there's just like an enormous amount of pride. I think you have to separate out like working for the company
and working for Elon. But yeah, I mean these are not unionized workforces, and like any effort to unionize or criticize your leader is like completely shut down, like almost instantly, which is what we've seen at all of his companies. I mean, I can't speak to Neural Lincoln Boring, but like you can't criticize the boss basically.
I also think the through line through these two stories is kind of like the double standard of when Elon's antics.
Are a problem and then when they aren't. You know, when he smoked pot.
You know, everyone was very upset because there is a very clear clause in NASA contracts that stays that you're supposed to have a drug free workforce.
But I think what.
SpaceX tried to do after that was say, oh, you know, this wasn't a big deal. You know, look, see we have a totally drug free workforce.
It's totally fine.
But then when you call out behavior about sexual harassment and making light of sexual harassment, then they say, oh, you can't do that. You know, Elon is SpaceX and SpaceX is Elon. That was something that one of the vice presidents said. So it's like there's the moving goalpost of when we are allowed to be upset about Elon's behavior and when you can't criticize him at all.
Now for our final segment of the week, Feud of the Week, Max Chapkin, do you know who the feud with between Elon and Oh Man?
It's my favorite other billionaire slash professional wrestler who's not named Mark Zuckerberg, Mark Cuban, who's kind of like the original in some ways, like a pioneer of the trolling, you know, billionaire category.
But I think Elon took that to new heights. Oh yeah, yeah, So what is the feud with Mark Cuban.
Okay, So, so Elon Musk has been, you know, for whatever reason. We can debate, you know, going.
On and on and on and on and on.
And on about you know, the woke mind virus and the and the evils of diversity in the workplace. Again, this is probably a potential problem for some companies arounds, but let's leave that aside. Mark Cuban chimed in and offered what was really like just a kind of bland i'd say, kind of conventional wisdom y defense of diversity,
equity and inclusion in companies. Mark Cuban saying essentially, hey, like this allows us to you know, overcome some of our biases to hire from more verse pools of people
get considered new perspectives. It also should say, Mark Cuban a big time libertarian, right, you know, too much for Elon Musk, and he's basically essentially spent the next few days, you know, calling Mark Cuban a racist cringe, you know, essentially using Mark Cuban as a punchline for his conservative followers, which, let's be honest, it's not that hard to do that with Mark Cuban. I mean, there is a lot that is obnoxious and cringe and so on about Mark Cuban.
So so it's kind of like easy pickens. And we have what essentially is like a professional wrestling match between two billionaires.
Which you know, we've we've seen this unfold before. How has Cuban responded so far?
He's continue to offer sensible And I can't believe I'm saying this because again, like this is a guy who you know, is famous for getting fined by the NBA, and is you know, a shark tank judge. Like I'm gonna be careful, but it has not always behaved like the most serious figure, but has generally attempted to like defend DEI in libertarian friendly ways and is essentially just getting shouted down by you know, Elon and his his buddies.
And it seems like both are kind of riding the engagement wave on this.
Okay, Dana, I'm gonna ask for an impartial view of feud of the weeks. How does this one rink compared to other feuds of the week that Elon Musk has had.
I would call it a mid level feud.
I mean, yeah, like a simmering five, Like, is it like rolling boil yet? Yeah?
I think what's interesting to me is that, Okay, you have to remember that Tesla is currently being sued by the EEOC and the State of California for anti black racism at its factory in California. And you know, Tesla has an incredibly diverse workplace, and the company releases first ever DEI report in twenty twenty. Now, the DEI stuff
is always part of the annual impact report. So you have this company that has made in enormous strides in terms of DEI as a corporation, and now the CEO is basically crapping all over DEI saying that it's reverse racism. So I just really wonder, like, is Tesla going to have a DEI report for twenty twenty three or not? Like is that work being dismantled? Like what exactly are they doing at the company level here?
It's easy to sort of laugh at this.
It's like two you know, billionaires barking at each other loudly.
Texas billionaires.
Yeah, but if you're if you are like a person of color at one of these companies, like it would feel pretty bad to have to like have, you know, basically a very pretty sensible explanation of like why it makes sense to not hire an exclusively white male workforce, and to just have that kind of laughed off, Like this kind of thing is like it isn't good for sort of regulatory reasons, but also just for like morale reasons and so on.
It strikes me as not great.
I also want to point that, if you know, given my experience with SpaceX and when I know about SpaceX, it does fly in the face of at least past experience, because they do have dei efforts, They have women's groups within the company that they celebrate. You know, Gwynn has also spoken publicly about trying to do better in terms
of boosting diversity within the company. So I don't know if that's going to change, but I at least know past efforts that SpaceX have tried to, you know, make that a priority.
Som Branding to this feud of the way, I will say, I think it's like Dan is right, it's like a mid tier feud. This is not like, this is not your like you know, Michelin Star eleven course tasting menu a feuds. This is like, I mean, the solid right I mean like solid midweek date night.
You know, it's like a farm to table restaurant.
It's like pretty good, but like not, you know, nothing, nothing out of the ordinary.
Max Chafkin, Lauren Grush, Dana Hole, thanks so much for joining us on Elon Inc.
Always a pleasure.
Thanks for having me.
Great to be here.
This episode was produced by Stacy Wong. Naomi Shaven and Rayhan Harmanci are our senior editors. The idea for this very show also came from Rayhan Blake Maple's Handles Engineering, and we get special editing assistants from Jeff Grocott. Our supervising producer is Magnus Hendrickson. That Elon Inc. Theme is written and perform by Taka Yazazawa and Alex Segura. Saige Bauman is the head of Bloomberg Podcast and our executive producer.
I'm Joel Webber. David Pappadopolis will finally be back next week. If you have a minute, please rate and review our show. We'll help other listeners find us. See you next week.