Next week, when SpaceX sells shares to the public, Elon Musk is widely expected to become the world’s first trillionaire. The company behind that price is losing money. And public money is about to flow into it: the retirement savings that states and cities manage for teachers, nurses, and other public workers. Taxpayers stand behind that money, which makes it everyone’s concern. The people who manage these savings can refuse to buy in, and some of the most careful investors in the world already have. What follows is the case for the rest to do the same.
Musk promises far more than he delivers, and he has done it for years. He told the public that Tesla cars would drive themselves, and he kept setting deadlines that passed without the cars driving themselves.
He promised a self-driving trip across the country by 2017 and a million robotaxis on the road by 2020. He has said it over and over again. Every word in that sentence links to a different year he said it.
The robotaxis are not here, and the self-driving car most owners paid for is still a system that needs a human watching it. The point can stay short, because most of you already know this record: Musk’s announcements and his companies’ actual results do not match, year after year, and that is the first thing a careful investor has to account for.
The same gap appears in Tesla’s results. The company still earns money, but it earns less each year. In the first quarter of 2025, Tesla’s net income fell 71 percent from the year before, to $409 million, and its operating margin dropped to 2.1 percent from about 10.8 percent a year earlier. In the fourth quarter of 2025, net income fell 61 percent to $840 million, and vehicle deliveries fell 16 percent.
The stock still trades at a price that only makes sense if the company grows quickly, while the car business that is supposed to produce that growth keeps shrinking.
SpaceX makes the same kind of promise about the future, on a much larger scale, and it is the company that makes Musk a trillionaire. It is private, so outsiders cannot see its full financial records, and it now also contains xAI and X, which Musk merged into it.
AkademikerPension, the Danish pension fund, studied the offering and refused to buy it, putting the company’s real worth at no more than $1 trillion. The offering itself sets the price at about $135 a share, which values SpaceX near $1.77 trillion and would raise roughly $75 billion. That is a record price for a company that went from a $791 million profit in 2024 to a loss of about $4.9 billion in 2025, with another $4.3 billion lost in the first quarter of 2026.
After the sale, Musk will hold about 85 percent of the voting power while serving as chief executive and chair, and the company will register as a controlled company, which exempts it from the Nasdaq rule that a majority of the board be independent. The people who buy shares will have no way to remove him or outvote him.
There is something particularly insidious about Musk’s strategy here. When the offering sells new shares, the roughly $75 billion goes to SpaceX itself, so buying in does fund the company directly. After that, the index rules will apply. Nasdaq rewrote its methodology so a company this large can enter the Nasdaq 100 just fifteen trading days after listing, which would be in early July, and the funds that track that index, including the retirement accounts and ETFs, are then required to buy the stock. The one provider that refused to shorten their waiting period was S&P, which on June 4 declined to waive its twelve-month seasoning rule and its profitability requirement, so SpaceX cannot enter the S&P 500 for at least a year, and only if it turns a profit.
To summarize for those of us with less experience around financial markets, they basically have these groups of investments and once your accepted into one of the groups, everyone who invests in that group then automatically purchases your stock. Some people say that Elon peddles imaginary progress to artificially inflate the value of his companies so he can buy his way onto these funds that his companies have no real right to be on if you look at their actual earnings and fundamentals. To be clear, I’m not saying that, but some people sure are. Now, do you know who loves buying into these funds? Public and institutional investors. That means state governments, unions, and organizations that hand over their money to trusted advisors who are doing their level best to make sound investing decisions.
Let’s now look at Tesla.
A Delaware court has already examined how Tesla is governed. In the Tornetta case, the Court of Chancery found in 2024 that Tesla’s board breached its fiduciary duty in approving Musk’s 2018 pay package and ordered the package cancelled. Musk publicly criticized the judge and moved Tesla’s incorporation to Texas.
In December 2025 the Delaware Supreme Court reversed, but it did not clear him. It expressly declined to decide whether the deal was fair or whether Musk controlled the board, and overturned the cancellation only on the narrow ground that taking the package back was too harsh a remedy. The breach finding remained in place; only the punishment was undone.
Musk kept the package, now worth about $139 billion, and Tesla shareholders then approved a new one worth up to about $1 trillion. Tesla also changed its bylaws so that a shareholder must own 3 percent of the company before bringing a breach-of-duty suit, which, at Tesla’s size, means almost no one can. And in 2025 the New York City Comptroller called on the city to sue Tesla and Musk for securities fraud on behalf of the city pensions, over what the office called misrepresentations about Musk’s leadership.
The claims Musk makes are themselves are protected by law. Over President Clinton’s veto, Congress passed the Private Securities Litigation Reform Act in 1995, creating a safe harbor for a company’s forecasts about its own future as long as it labels them forward-looking. Clinton warned it would block investors with legitimate claims from going to court, and Congress passed it anyway. So a prediction that fails is protected, and only an outright false statement about a present fact is fraud, as when the SEC charged Musk in 2018 over his claim that he had secured funding to take Tesla private. This is another example of the law being narrowed over the last 3 decades to make it easier for the powerful to avoid justice.
Musk’s conduct has also harmed people far beyond his investors. When he ran the Department of Government Efficiency, the administration cut about 83 percent of USAID programs. A study in The Lancet estimates those cuts could cause more than 14 million additional deaths by 2030, including more than 4.5 million children under the age of five.
His political work also damaged Tesla’s own business, and the officials who oversee public pensions have named that work as a direct risk to their members’ money.
The most pragmatic investors have already started abandoning Musk’s companies. In Denmark, AkademikerPension sold its Tesla shares in 2025 and refused the SpaceX offering. Sweden’s AP7, which runs the default fund in the national pension system, sold about €1.2 billion in Tesla. ABP in the Netherlands, one of Europe’s largest pension funds, sold its entire Tesla stake. Norway’s sovereign wealth fund sold its Tesla shares again in early 2026.
In the United States, the Lehigh County pension fund in Pennsylvania voted to divest, and in May 2026 the officials who run the New York City, New York State, and California public pension systems wrote jointly to SpaceX to warn that its governance denies shareholders the usual protections. Each of them described the choice as a financial judgment about risk to the money they hold in trust.
This is where a fiduciary’s duty applies. The people who manage a pension cannot simply buy a stock and leave it alone. The Supreme Court held in Tibble v. Edison that a fiduciary has a continuing duty to monitor its investments and remove the imprudent ones, separate from the duty to choose well at the start. Doing nothing is not an appropriate position.
And consider what has happened to every ordinary check on Musk. The courts gave the pay package back. The bylaws now block shareholder suits. The safe harbor protects the wild claims. The people who run public funds are among the few left who can still do something to substantively influence the situation. Musk enterprises do not belong in a well balanced and responsible financial investment portfolio.
With Tesla, the action is to sell, because a court has found a breach and a major pension has called for a fraud suit over the company’s disclosures, and the clearest remedy is against Musk and Tesla, not the fund: a securities-fraud case of the kind New York has urged, which a fund can subsequently join or bring to recover losses.
SpaceX is the more difficult problem to address; though in the future we should work on advocating for the end of all government contracts with Musk enterprises, along with Thiel and other malignant oligarchs. Until then, we can fight to have city and state governments, along with unions and private investors, all push to screen Tesla and SpaceX out of their holdings, including the exposure that comes through index funds.
We aren’t demanding divestment because these companies are evil, we are demanding divestment because it is irresponsible to invest in the snake oil of the most successful vaporware salesman in human history.
The officials who decide what those funds buy are people we can contact. In most US states, voters elect a treasurer or a comptroller who oversees the pension board, and cities run their own funds through a comptroller or treasurer and a board of trustees. We can write to them as members where we have a pension, or as the taxpayers and voters who put them in office.
Readers outside the United States can write to the trustees of their own national or workplace fund, the same kind of contact that produced the decisions in Denmark, Sweden, the Netherlands, and Norway. These boards hold meetings open to public comment, and they read what the public sends them.
A letter does not need to be long. It needs to say who we are, why we care, what the evidence shows, and what we want. Here is one we can adapt, wherever we live:
To the trustees of [your pension fund], or to [your state or city treasurer or comptroller],
My name is [your name], and I live in [your city, state, or country]. I am writing as [a teacher, a nurse, a retiree, a taxpayer, a member whose pension you manage], because [one or two sentences in your own words on why this matters to you].
I am asking you to tell me whether the funds you manage hold shares in Tesla or any interest in SpaceX, and to stop buying them and sell what you already hold.
I am not asking lightly. A Delaware court found that Tesla’s board breached its fiduciary duty, and the New York City Comptroller has called for a securities-fraud suit against Tesla over its disclosures about Musk’s leadership. Pension funds in Denmark, Sweden, the Netherlands, and Norway have already sold their Tesla shares or refused to buy SpaceX, which is losing billions a year and which a major pension fund judged to be worth little more than half its asking price. You have a continuing duty to monitor these holdings and remove the imprudent ones, and I am asking you to do that.
I would be grateful for a written reply telling me what you hold and what you intend to do.
Respectfully, [your name] [your city, state, or country] [your contact information]
We put our own names on it and send it to the office that runs the fund where we live or work, or to the official who oversees that fund. One letter is easy to ignore. A large number of letters about the same companies, arriving at the same office, is harder to ignore, and the offices that act first are usually the ones that hear from the public.
So here is the choice we face. Next week SpaceX, a company that loses billions a quarter, is priced near $1.77 trillion, that price makes its owner the first trillionaire, and the public funds that taxpayers pay for will be pushed to buy it. The valuation depends on promises and on buying that index rules will force, and the ordinary checks on Musk have been removed one by one.
The most pragmatic investors in the world have studied all of it and refused to invest. The people paid to protect public money have every reason to do the same, and some already have. Let’s keep the justice moving.
Be the movement. Bring the heat. And let’s get the water boiling for Mr. Musk.
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His house cards built off of taxpayer money
You da man, Christopher! 👏👏👏. On this subject, here is an article that appeared on Ars Technica: https://arstechnica.com/tech-policy/2026/06/sp-500-blocks-fast-spacex-entry-wont-waive-rule-for-unprofitable-ai-firms/