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Speaker 1: Bloomberg Audio Studios, Podcasts, radio news.

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Speaker 2: Well, Elon Musk is now the richest person on the planet.

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Speaker 3: More than half the satellites in space are owned and

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Speaker 3: controlled by one man.

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Speaker 4: Well, he's a legitimate super genius. I mean legitimate.

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Speaker 1: He says he's always voted for Democrats, but this year

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Speaker 1: it will be different.

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Speaker 5: He'll vote Republican.

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Speaker 3: There is a reason the US government is so reliant

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Speaker 3: on him. Alon Musk is a scam artist and he's

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Speaker 3: done nothing. Anything he does, he's fascinating people.

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Speaker 4: Welcome to delon Ing, Bloomberg's weekly podcast about Elon Musk.

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Speaker 4: It's Tuesday, July ninth. I'm your host, David Poppadopolis. This

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Speaker 4: week we'll dig into a business story by reporters Josh

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Speaker 4: Eidelsen and Lauren Grush about the problems at SpaceX, in

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Speaker 4: particularly anything Goes workplace culture that has spawned multiple lawsuits.

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Speaker 4: Former employees alleged that the fratthause mentality came from the

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Speaker 4: top and that Musk had them fired when they questioned

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Speaker 4: his leadership. Also, there's a new development and a feud

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Speaker 4: that has been simmering for years between LinkedIn founder reied

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Speaker 4: Hoffman and Elon our regulars Max Chafkin and Dana Hall

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Speaker 4: are here to discuss where the love was lost between

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Speaker 4: the two old pals, and stick around to the end.

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Speaker 4: We're gonna debate short shorts. Hey, Max, Hey, David, Dana Hello, Hello, Hello,

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Speaker 4: Okay Max. So usually our feud watch, of course, is

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Speaker 4: at the end of the show, but this one is

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Speaker 4: just so hot and just and rock them, sock them that.

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Speaker 4: We just got a bang right off the bat. We're

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Speaker 4: going to start with it. Tell us about it.

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Speaker 2: Okay, Well, it's not just that it's hot, but maybe

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Speaker 2: it says something bigger. A couple days ago, Elon Musk

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Speaker 2: started tweeting, ixing about his longtime sort of friend colleague

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Speaker 2: Reid Hoffman, co founder of LinkedIn. He did a post

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Speaker 2: suggesting that the FBI should investigate Reid Hoffman along with

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Speaker 2: Bill Gates, for potential connections to Jeffrey Epstein, and then

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Speaker 2: suggested that if the FBI failed to investigate, that the

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Speaker 2: FBI should possibly be abolished.

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Speaker 4: Pretty hot take.

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Speaker 2: And not only is it sort of a hot take,

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Speaker 2: but it's one an attack against two very very public figures,

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Speaker 2: including one who has this long relationship with Elon Musk.

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Speaker 2: Reid Hoffman was one of the earliest employees of PayPal.

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Speaker 2: He and Musk, I don't think calling them friends is

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Speaker 2: maybe a stretch, but they have done a lot of

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Speaker 2: business together over the years, so it's pretty aggressive.

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Speaker 4: I would say abolishing the FBI is a pretty radical proposal.

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Speaker 4: So then any sense of when the falling out began,

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Speaker 4: I don't really know.

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Speaker 5: I mean, yeah, it seems like the PayPal mafia is

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Speaker 5: now eating itself, right, I mean, these guys have all

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Speaker 5: gone on to have incredible careers. Reid is this huge investor,

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Speaker 5: really big donor to the Democratic Party, And I think

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Speaker 5: a couple of things have happened, Like there was a

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Speaker 5: Ronan Faroh profile in The New Yorker a while ago

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Speaker 5: where Reid Hoffman was one of the sort of main

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Speaker 5: people quoted being critical of Elon. And Elon reads everything

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Speaker 5: about himself. It probably has Google alerts set for himself,

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Speaker 5: so he was probably not happy about that. Reid Hoffman

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Speaker 5: is on the board of Microsoft and was on the

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Speaker 5: board of Open Ai, and you know, Musk is now

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Speaker 5: in this blocked battle about with Sam Altman and Ai.

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Speaker 5: And then there's the whole political thing about David Sachs

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Speaker 5: who's another PayPal mafia guy, seems to be Musk's kind

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Speaker 5: of de facto foreign policy advisor. And then Reid came

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Speaker 5: out swinging in a tweet, in a bunch of tweets

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Speaker 5: sort of against David Sachs. So I don't really know

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Speaker 5: where this all where this all is, but my impression

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Speaker 5: is that I don't mean, I don't think that Reid

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Speaker 5: Hoffman has been a big investor in Elon's companies like

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Speaker 5: Graylock is not.

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Speaker 3: Sequoya definitely not.

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Speaker 2: And we should also say that they, you know, Reid

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Speaker 2: Hoffman was part of this crew that you know, more

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Speaker 2: than twenty years ago, almost twenty five years ago, got

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Speaker 2: Elon fired and a.

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Speaker 4: Right managed too that had him ousted.

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Speaker 2: As a PayPal CEO, which which I think is still

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Speaker 2: kind of like one of the formative things in his

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Speaker 2: business career, something that you know, he he you know,

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Speaker 2: has found a way to forgive and work with some

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Speaker 2: of these folks. Sequoya, which was instrumental in that firing,

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Speaker 2: as Dan is hinting, you know, has invested in a

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Speaker 2: lot of his companies. But it's but again it's it's

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Speaker 2: not exactly like they're the greatest of pals and the

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Speaker 2: other thing. I mean, I think you have several things

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Speaker 2: going on, one of which is that Elon Musk is

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Speaker 2: very engaged in the twenty twenty four or election. He's

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Speaker 2: he's essentially you know with this this reied Hofmin quote

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Speaker 2: tweet is you know, one of many that have come

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Speaker 2: out over the last few days, and you know about

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Speaker 2: allegations that the Democrats are secretly importing illegal aliens to vote.

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Speaker 2: You know, he's very much still on that. You know,

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Speaker 2: he's this is like part of a general like, Hey,

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Speaker 2: I'm posting a lot of right wing memes. The Epstein

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Speaker 2: thing very popular among conservatives. It ties into some other

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Speaker 2: concerns slash conspiracies around pedophilia and so on, and so

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Speaker 2: I think like that's part of the squirrel. And then,

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Speaker 2: as Dana is saying, like Reid Hoffman is a business

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Speaker 2: adversary of Elon Musk at this point, and you know,

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Speaker 2: as as somebody who's closely associated with open Ai, the

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Speaker 2: hottest company in the field that Elon Musk very wants,

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Speaker 2: very much wants to participate in.

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Speaker 4: So he's both a business adversary at this point and

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Speaker 4: also a political adversariy.

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Speaker 2: Absolutely, yeah, as a major dem donor and if Elon

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Speaker 2: you know, we've talked about the possibility that Elon Musk

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Speaker 2: could donate to Trump as Donald Trump and his campaign

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Speaker 2: would certainly hope you know, that would put him, you know,

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Speaker 2: basically in the Reid Hoffman role but for the Republicans, okay.

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Speaker 4: And so then this whole thing from Elon about you know,

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Speaker 4: the FBI has got to investigate Hoffman for his Epstein connections.

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Speaker 4: Weird to take this seriously or simply see it in

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Speaker 4: the through the light of the of what you had

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Speaker 4: mentioned earlier, that it this just happens to be a

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Speaker 4: very popular conspiracy theory among.

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Speaker 2: I think we need to take it as a political

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Speaker 2: slash posting kind of thing, not as a like serious

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Speaker 2: policy proposal, although there are serious policy proposals within the

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Speaker 2: sort of Trump world that involve getting rid of the

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Speaker 2: FBI or or at least making it more subservient to

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Speaker 2: like the president than than it currently is.

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Speaker 5: It's also interesting to me that that Musk is lumping

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Speaker 5: Reid Hoffman and Bill Gates together because, as Maxwell knows,

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Speaker 5: the feud with Bill Gates is goes on for it

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Speaker 5: has been like a long standing Elon feud because Bill

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Speaker 5: Gates was shorting Tessela stock at one point, and so

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Speaker 5: Musk has always had this thing about Bill Gates and

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Speaker 5: now he's kind of lumping Bill and read together. Reid

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Speaker 5: is obviously on the board of Microsoft.

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Speaker 3: Yeah, yeah, there, and both as major backers of Open Ai.

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Speaker 4: Of course, now has Dana has Has Hoffman responded to

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Speaker 4: these tweets from Elon.

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Speaker 5: Not that I'm aware of. I mean, I think that

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Speaker 5: he's shrewd enough to know that like there's no upside

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Speaker 5: and kind of like responding to Elon in this way

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Speaker 5: on Elon's platform.

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Speaker 2: We should say there has been serious reporting on connections

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Speaker 2: of many executives, including Reid Hoffman, with with Jeffrey Epstein.

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Speaker 2: He has said he regrets having had any dealings with

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Speaker 2: Epstein and that the dealings we're having to do with

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Speaker 2: trying to raise money for MIT, which you know doesn't

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Speaker 2: sound like Elon Musk credits that, but that is the

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Speaker 2: that is his position.

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Speaker 4: Okay, listen, you two, We're going to let you go briefly,

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Speaker 4: so go out, get yourself, you know, a cup of coffee,

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Speaker 4: stretch the legs, and we'll see you back at the

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Speaker 4: end of the show. Okay, Okay, So now we're going

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Speaker 4: to talk about SpaceX and the legal battle they are

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Speaker 4: in with some former employees of theirs. And to do

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Speaker 4: this we have Josh Idelson, senior reporter covering labor first

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Speaker 4: here Bloomberglo Josh, Hello, and Lauren Grush, who covers space

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Speaker 4: for US.

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Speaker 1: Hello, Lauren, Hi, good to be here in.

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Speaker 4: The story that you guys had that's out today. I'm Bloomberg.

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Speaker 4: Great story. There are many lawsuits and counter lawsuits and

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Speaker 4: the like, and it can all get a bit complicated.

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Speaker 4: But explain what the contours are of the main lawsuit here,

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Speaker 4: the one brought by the eight former SpaceX employees.

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Speaker 3: So, eight former SpaceX engineers allege that SpaceX subjected workers

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Speaker 3: to sexual harassment, that men stared at women's chests, said

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Speaker 3: they were biologically incapable of being engineers, made crude jokes

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Speaker 3: that mimicked Elon Musk's tweets, that Elon Musk was injecting

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Speaker 3: inappropriate content into the workplace that contributed to a hostile

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Speaker 3: work environment, and that rather than addressing these issues, rather

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Speaker 3: than punishing people for actual misconduct, Elon Musk and other

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Speaker 3: executives punished the people who spoke up about it that

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Speaker 3: because these eight people and others were involved in an

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Speaker 3: open letter urging the company to hold everybody accountable, including

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Speaker 3: to what SpaceX calls its no Apple policy, SpaceX responded

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Speaker 3: with firings. These eight employed poes brought these allegations to

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Speaker 3: the US labor board, the National Labor Relations Board known

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Speaker 3: as the NLRB, which issued a complaint in January, and

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Speaker 3: after SpaceX responded to that NLRB case by suing the NARB,

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Speaker 3: saying that the NLRB is unconstitutional and any trial it

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Speaker 3: would have under its existing structure would be illegitimate and

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Speaker 3: unfair to SpaceX. These workers also brought claims in California

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Speaker 3: State court saying that a company has been violating California

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Speaker 3: law about sexual harassment and whistleblower retaliation. So that brings

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Speaker 3: us to three cases.

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Speaker 4: It's a big step to say, hey, we're going to

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Speaker 4: write an open letter addressed to the CEO and the

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Speaker 4: rest of the management and effectively challenge them. What led

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Speaker 4: them to do that?

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Speaker 6: Yeah, The way it was described to us is that

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Speaker 6: it was building for some time. In the article we

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Speaker 6: talk about, you know, the underlying culture of SpaceX, which

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Speaker 6: Josh had touched on, but yeah, it was.

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Speaker 1: You know, it's an open secret.

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Speaker 6: I wouldn't even say it's a secret, but you know,

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Speaker 6: SpaceX has a really strong burnout culture. They hire twenty

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Speaker 6: somethings out of college and they they purposely kind of

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Speaker 6: put them through the ringer, make them work long hours.

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Speaker 6: And the way that is often described to us is

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Speaker 6: kind of mimicking Elon because you know, he's been very

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Speaker 6: open about how much he values work, sleeping in his office,

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Speaker 6: you know, staying late to meet really hard deadlines. So

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Speaker 6: there's a lot of stuff that trickles down from the

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Speaker 6: top that kind of permeates SpaceX. And so some of

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Speaker 6: that also had to do with his crash jokes and

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Speaker 6: kind of the casual sexism that he displays in his

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Speaker 6: online persona. They were seeing that, you know, at work

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Speaker 6: as well. One of the things that they like to

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Speaker 6: point out to is his joke about university and how

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Speaker 6: people were making jokes about that particular tweet that he

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Speaker 6: made and it's technically Texas Institute of Technology and Science,

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Speaker 6: and he had made a follow up joke about you know,

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Speaker 6: where d's get degrees, and so, you know, at.

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Speaker 1: Work, a few folks had heard jokes.

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Speaker 6: Being made about university and who might be able to attend,

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Speaker 6: and so it was just kind of those things would

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Speaker 6: seep through into the culture. But then there were a

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Speaker 6: few inciting incidents that really led up to this.

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Speaker 1: The first big.

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Speaker 6: One was a former employee by the name of Ashley

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Speaker 6: Cosack had written an essay for the publication Lioness about

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Speaker 6: her experience with sexual harassment at SpaceX. And then probably

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Speaker 6: the biggest moment that really made them turn a corner

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Speaker 6: was a Business Insider article that came out alleging SpaceX

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Speaker 6: had paid a flight attendant two hundred and fifty thousand

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Speaker 6: dollars to keep quiet about harassment that she had experienced

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Speaker 6: by Elon Musk. And so so all those things led

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Speaker 6: up to it, but we really put that over the

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Speaker 6: edge was Gwinn shot Well, the president of SpaceX, response

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Speaker 6: to that article, basically defending Elon, saying, Oh, I don't

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Speaker 6: believe these allegations. I've known Elon. He couldn't possibly have

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Speaker 6: done this. You know, he's this is not the man

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Speaker 6: I know him to be. And so that response from

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Speaker 6: Gwinn was really when most of the people involved with

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Speaker 6: the letter realized, Okay, this you know, change isn't going

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Speaker 6: to come from the top. This is something that we

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Speaker 6: have to do ourselves, and so that ultimately inspired them

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Speaker 6: to take collective action together.

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Speaker 4: Gwinn was seen by many as the adult in the

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Speaker 4: room and the person who sort of helped keep SpaceX

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Speaker 4: on task and cloud through some of the distractions created

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Speaker 4: by Elon.

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Speaker 6: Yeah, and if you think, if you read and listen

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Speaker 6: to all of the commentary that is out there about SpaceX,

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Speaker 6: you know, so much emphasis is placed on the fact

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Speaker 6: that Gwen is the one in charge.

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Speaker 1: You know.

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Speaker 6: We referenced an interview with NASA administrator Bill Nelson, who

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Speaker 6: is frequently asked about Elon's behavior because SpaceX is such

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Speaker 6: a big partner with NASA, and time and time again,

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Speaker 6: he constantly points to the fact that the best thing

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Speaker 6: that Elon did was he put Gwen shot Well in charge,

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Speaker 6: and so therefore he has full confidence in SpaceX to

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Speaker 6: do the things that they say they're going to do

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Speaker 6: and operate professionally because of Gwen, you know, she is

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Speaker 6: often lauded as the adult in the room, but there

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Speaker 6: are times when she does essentially, you know, do what

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Speaker 6: Elon wants for the company. And because he is ultimately

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Speaker 6: the top of the company.

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Speaker 4: Okay, so Josh In mid twenty twenty two, this letter

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Speaker 4: is written and circulated. How many fellow SpaceX employees ultimately

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Speaker 4: wind up signing this letter?

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Speaker 3: More than four hundred SpaceX employees had signed on to

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Speaker 3: the letter when it was posted on an internal server

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Speaker 3: before it was taken down.

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Speaker 6: And something important to note David too, is that the

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Speaker 6: letter wasn't available for signing for very.

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Speaker 4: Long, Like how long? How long was it up before

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Speaker 4: it got pulled down?

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Speaker 6: I believe it was roughly a day and a half less,

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Speaker 6: you know, it wasn't very long that people had the

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Speaker 6: opportunity to actually sign on to it. So that's four

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Speaker 6: hundred people before it was ultimately taken down.

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Speaker 3: One of the things that stood out about this letter,

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Speaker 3: while it does call out Elon Musk, is it goes

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Speaker 3: to lengths to cite the company's own values, to emphasize

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Speaker 3: pride in the company, how much the company has accomplished

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Speaker 3: in other areas, and couldn't it similarly be more ambitious

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Speaker 3: about diversity and equity and inclusion. We report in the

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Speaker 3: story there had been discussion about doing something like a walkout,

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Speaker 3: as had happened at Google, and the authors decided instead

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Speaker 3: to go with something that felt more like a conversation

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Speaker 3: among family. They said there was a sense of trying

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Speaker 3: to speak in away the company could hear.

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Speaker 4: Right if that was the hope, though, the response they

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Speaker 4: get in addition to their to their firing, the firing

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Speaker 4: of these people is in the aftermath. As one Musk

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Speaker 4: loyalist in the company puts it, Lauren is SpaceX is Elon,

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Speaker 4: and Elon is SpaceX I E. This is who we are.

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Speaker 4: This is the way we're going to roll, you know,

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Speaker 4: like it or leave it.

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Speaker 6: Yeah, essentially, yeah, it's it's They made it very clear

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Speaker 6: that the company was not going to you know, extricate

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Speaker 6: themselves from Elon's personal brand, and that was ultimately where

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Speaker 6: I think the letter writers really understood that, you know,

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Speaker 6: if there was going to be any dissent in this workplace,

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Speaker 6: it was going to be quote unquote canceled, which is

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Speaker 6: ironic given Elon's penchant for, you know, decrine wokeness and

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Speaker 6: cancel culture. I feel like there's been multiple times where

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Speaker 6: Elon has proclaimed, oh, you know, if your employer fires

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Speaker 6: you for speaking up about certain things, you know, we

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Speaker 6: will pay well.

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Speaker 1: The lawyer Bill. I think I remember him speaking to that.

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Speaker 6: Point, and you know, a lot of people kind of

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Speaker 6: pointed out the hypocrisy there. But that's essentially what happened here, right,

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Speaker 6: is that a group of his employees were speaking up

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Speaker 6: about working conditions.

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Speaker 1: They happened to target.

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Speaker 6: Him specifically when they were doing so, but they were

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Speaker 6: talking about the company culture as a whole, and how

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Speaker 6: they wanted to make sure that that no Apple policy

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Speaker 6: that we've discussed was being applied equally to everyone, because

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Speaker 6: they were pointing out that, you know, if some of

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Speaker 6: the people at SpaceX behaved the way that Elon did,

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Speaker 6: that behavior would certainly not fly at least according to

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Speaker 6: this so called no Apple policy.

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Speaker 4: Okay, so Elon responded initially by by cracking down and

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Speaker 4: by firing all the people, the rebels who led the

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Speaker 4: who led the uprising. How else has he responded to

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Speaker 4: this whole episode, if at all learned?

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Speaker 6: Oh, there have been various jokes on Twitter, if you

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Speaker 6: can believe it, But yes, people have tweeted memes about

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Speaker 6: the fired letter writers, and he's responded to them with

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Speaker 6: laughing emojis and things like that. So basically treating the

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Speaker 6: entire thing as a joke, and the common refrain online

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Speaker 6: is you know, oh, if you're going to speak up

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Speaker 6: about your employer, how can you be shocked that you

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Speaker 6: would get fired? And he's kind of fed into that

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Speaker 6: narrative as well with his tweets and responses.

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Speaker 4: Now, Josh, the firings themselves, they came pretty quickly in

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Speaker 4: the aftermath of the letter and were pretty ruthless tell

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Speaker 4: us a bit about how they went down.

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Speaker 3: So by the day after the letter was posted, several

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Speaker 3: of the key people involved had been fired. One told

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Speaker 3: us he knew he was in trouble when he got

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Speaker 3: called into the conference room with the frosted windows when

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Speaker 3: shot well, Tella chastised the workers via a laptop that

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Speaker 3: was pointed away from the person being fired in each

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Speaker 3: case and accused them of distracting the company. One of

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Speaker 3: them was walked out so quickly that the vice president

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Speaker 3: for HR after doing so, had to call him and

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Speaker 3: ask him to come back and get his last paycheck,

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Speaker 3: and Gwen emailed the whole staff, telling them that there

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Speaker 3: was no need for this sort of what she called

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Speaker 3: overreaching activism and that people involved had been terminated.

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Speaker 4: Now Lauren, one of those terminated is a woman by

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Speaker 4: the name of Paige holl And teal and tell us

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Speaker 4: a little bit about her.

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Speaker 6: Yeah, she was really kind of the forcing function for

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Speaker 6: this entire thing. She was the one that created the

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Speaker 6: group chat that ultimately led to the collective writing of

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Speaker 6: the letter, and she's been probably the most vocal throughout

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Speaker 6: this whole experience. But she goes into detail about the

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Speaker 6: experiences that she had at SpaceX leading up to this.

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Speaker 6: You know, she talks about the fact that she felt

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Speaker 6: like she was her voice wasn't heard, that she was

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Speaker 6: left out a lot of decisions that she felt like

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Speaker 6: she should have been a part of that She would

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Speaker 6: have ideas that people wouldn't take seriously, but then when

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Speaker 6: her male colleagues would present them, then they would suddenly

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Speaker 6: be taken seriously. She also, you know, experienced this casual

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Speaker 6: sexism that we talked about, where people were making really

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Speaker 6: inappropriate jokes. At one point, she talked about how she

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Speaker 6: was actually going to go to a manager and talked

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Speaker 6: to him about you know, sexism that she had overheard

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Speaker 6: and inappropriate behavior that she'd overheard, and as she was

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Speaker 6: talking to him, he cracked a joke. So, you know,

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Speaker 6: she had started to experience this behavior for a while

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Speaker 6: leading up to this, trying to justify whether or not

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Speaker 6: it was right. You know, one thing she talked about

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Speaker 6: was feeling trapped because you know, as Josh mentioned, you

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Speaker 6: know a lot of these people came on in spite

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Speaker 6: of but they ultimately came on, you know, thinking that

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Speaker 6: they were going to be changing the world.

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Speaker 1: They definitely felt that.

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Speaker 6: The entire goal and conceit of SpaceX was what they

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Speaker 6: ultimately wanted to sign on for, you know, making humans multiplanetary,

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Speaker 6: you know, helping Earth by sending people to space, sending

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Speaker 6: satellites to space. That was kind of the thesis that

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Speaker 6: they agreed to, agreed to sign onto when they came

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Speaker 6: onto the company. And so for a lot of them,

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Speaker 6: you know, they felt like they couldn't go anywhere else,

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Speaker 6: including Paige, because this was the only place that was

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Speaker 6: doing the meaningful kind of space work that they wanted

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Speaker 6: to do.

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Speaker 4: Now, Josh, what does Page and the others, what exactly

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Speaker 4: do they want from this lawsuit? Do they want to

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Speaker 4: return to SpaceX?

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Speaker 3: So in the case that the workers brought to the

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Speaker 3: National Labor Relations Board the n LRB, the government, were

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Speaker 3: it to succeed, could force SpaceX to offer for reinstatement

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Speaker 3: to those workers. In the lawsuit that these workers filed

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Speaker 3: in California State Court, along with damages, they are seeking

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Speaker 3: an injunction to force the company to change the conditions

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Speaker 3: that they say created this hostile work environment.

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Speaker 4: It is our understanding, Lauren, though, that those conditions described

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Speaker 4: then largely still exist at SpaceX today.

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Speaker 1: Yes, and no. I think multiple things can be true.

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Speaker 6: I think there are probably some people at SpaceX who

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Speaker 6: experience a great working and you know, they don't have

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Speaker 6: any problems. One thing that we know about spaces is

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Speaker 6: it's predominantly male, and so I think there are probably

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Speaker 6: plenty of people who have great experiences at the company.

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Speaker 1: However, I think probably there are quite a.

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Speaker 6: Few people who also experience the same thing that these

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Speaker 6: letter writers are voicing, you know, opposition to I think

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Speaker 6: what has been very clear is since this letter was written,

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Speaker 6: is that people are definitely not coming forward about any

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Speaker 6: grievances they have with the company anytime soon, at least

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Speaker 6: in a public.

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Speaker 1: Way like this.

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Speaker 6: You know, the sources that I speak to within the company,

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Speaker 6: they just say that, you know, their ambition is just

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Speaker 6: to work. They just want to focus on the job.

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Speaker 6: They just want to put their heads down and not

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Speaker 6: think about what Elon is doing.

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Speaker 1: What he's saying.

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Speaker 4: Now, I want to talk for a second a bit

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Speaker 4: about the National Labor Relations Board Josh, which is where

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Speaker 4: this lawsuit, the main suit, was filed. In the story,

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Speaker 4: you guys write that it too, in the process of

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Speaker 4: this suit being filed, there has come under pressure of

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Speaker 4: its own and that Musk to a certain degree, has

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Speaker 4: the group on the retreat.

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Speaker 3: Explain, the NLRB is small agency that is tasked with

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Speaker 3: making it so that you can collectively complain about your

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Speaker 3: boss or about the conditions on your job without losing

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Speaker 3: your job over it. And Elon Musk now has this

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Speaker 3: agency on the defense because after the NLRB brought its

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Speaker 3: case against SpaceX, the next day, SpaceX brought a lawsuit

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Speaker 3: arguing that the NLRB is unconstitutional, that its structure violates

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Speaker 3: the tenets of the Constitution. And as usual, Elon Musk

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Speaker 3: brought this case to Texas to the Fifth Circuit Court

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Speaker 3: of Appeals, which has become in a way, his legal

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Speaker 3: safe space. It has repeatedly taken up and considered overturning

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Speaker 3: or overturned rulings against Elon's companies, and after some initial

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Speaker 3: traction for the NLRB and the workers and trying to

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Speaker 3: get the lawsuit from SpaceX shipped off to California to

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Speaker 3: a friendlier set of judges, Elon Musk is now winning

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Speaker 3: because a panel of Fifth Circuit judges agreed to an

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Speaker 3: injunction putting the NLRB's case on pause, and the NLRB,

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Speaker 3: in an effort to disgorge this case from the Fifth Circuit,

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Speaker 3: has now volunteered the idea of indefinitely pausing its case

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Speaker 3: against SpaceX while Elon Musk and SpaceX's lawsuit against the

439
00:25:36,520 --> 00:25:41,400
Speaker 3: NLRB proceeds. And the lawsuit that SpaceX has brought does

440
00:25:41,440 --> 00:25:44,240
Speaker 3: not just potentially affect SpaceX workers.

441
00:25:44,320 --> 00:25:48,640
Speaker 4: It would affect right every similar case presumably across all

442
00:25:48,640 --> 00:25:51,960
Speaker 4: industries would now I guess this would serve as something

443
00:25:52,000 --> 00:25:55,280
Speaker 4: of a precedent for them. So in other words, the

444
00:25:55,359 --> 00:25:58,840
Speaker 4: NLRB is saying, Okay, we're going to drop our not

445
00:25:58,920 --> 00:26:02,800
Speaker 4: drop our case, but we're just going to hang out

446
00:26:03,080 --> 00:26:08,760
Speaker 4: until essentially another court decides if we're a legal constitutional body.

447
00:26:08,960 --> 00:26:11,359
Speaker 4: So it sounds like the stakes are pretty high here, Josh.

448
00:26:11,960 --> 00:26:16,520
Speaker 3: The stakes are high here with the trumpified judiciary, we

449
00:26:16,680 --> 00:26:22,200
Speaker 3: could see any number of outcomes, including changing the structure

450
00:26:22,200 --> 00:26:25,959
Speaker 3: of the agency so that the next president, say Donald Trump,

451
00:26:26,560 --> 00:26:30,880
Speaker 3: could fire all of the NLRB's judges who consider cases

452
00:26:30,960 --> 00:26:34,320
Speaker 3: like this and replace them, could fire all the members

453
00:26:34,440 --> 00:26:37,760
Speaker 3: of the NLRB who consider appeals of those rulings and

454
00:26:37,840 --> 00:26:42,480
Speaker 3: replace them. There could be hundreds of cases forcibly rewound

455
00:26:42,720 --> 00:26:48,880
Speaker 3: back to before an agency judge considered them, and there

456
00:26:48,960 --> 00:26:55,159
Speaker 3: is now fear from advocates and including from workers we

457
00:26:55,240 --> 00:26:59,680
Speaker 3: talked to that the consequence of their effort to stand

458
00:26:59,720 --> 00:27:03,000
Speaker 3: up to the company could be an opportunity for the

459
00:27:03,119 --> 00:27:07,080
Speaker 3: judiciary to take a bite out of the agency that's

460
00:27:07,080 --> 00:27:09,080
Speaker 3: supposed to protect this kind of activism.

461
00:27:09,440 --> 00:27:14,280
Speaker 4: I suppose the other large institution that would or could

462
00:27:14,320 --> 00:27:18,120
Speaker 4: potentially serve as a check on SpaceX and its culture

463
00:27:18,119 --> 00:27:21,960
Speaker 4: and behavior is NASA. NASA, which of course hands out

464
00:27:22,000 --> 00:27:25,760
Speaker 4: any number of large contracts to SpaceX. Is what is

465
00:27:26,200 --> 00:27:28,080
Speaker 4: nasau stance on the topic.

466
00:27:28,600 --> 00:27:31,320
Speaker 6: NASA does not want to talk about it. It's ultimately

467
00:27:31,359 --> 00:27:34,359
Speaker 6: their stance about it. Over the last two decades, SpaceX

468
00:27:34,400 --> 00:27:38,800
Speaker 6: has become indispensable to the federal government in terms of

469
00:27:38,840 --> 00:27:43,200
Speaker 6: our space program's needs, that ranges from launching the Space

470
00:27:43,240 --> 00:27:48,800
Speaker 6: Force's most sensitive national security satellites, and it also extends

471
00:27:48,880 --> 00:27:52,320
Speaker 6: to launching humans to the International Space Station. So both

472
00:27:52,440 --> 00:27:56,280
Speaker 6: NASA and the Space Force greatly rely on SpaceX so

473
00:27:56,400 --> 00:27:58,080
Speaker 6: basically prop up our space.

474
00:27:57,840 --> 00:27:59,160
Speaker 1: Program at the moment.

475
00:27:59,359 --> 00:28:03,679
Speaker 6: And at the same time, Elon's behavior has also become

476
00:28:04,119 --> 00:28:06,080
Speaker 6: more and more public and you know, more and more

477
00:28:06,119 --> 00:28:09,840
Speaker 6: crass in the public sphere, and you know, we continue

478
00:28:09,880 --> 00:28:12,919
Speaker 6: to ask NASA and the Space Force, you know, if

479
00:28:12,960 --> 00:28:17,320
Speaker 6: they condone this behavior. Very famously, when Elon Musk smoked

480
00:28:17,359 --> 00:28:21,840
Speaker 6: pot on Joe Rogan's podcast, NASA conducted an audit of

481
00:28:21,880 --> 00:28:27,000
Speaker 6: SpaceX's safety culture, but they ultimately determined that, you know,

482
00:28:27,560 --> 00:28:30,720
Speaker 6: SpaceX was above board and everything was fine. There have

483
00:28:30,720 --> 00:28:34,000
Speaker 6: been efforts to foia that audit and they have come

484
00:28:34,080 --> 00:28:35,480
Speaker 6: back completely redacted.

485
00:28:35,920 --> 00:28:38,760
Speaker 1: But basically that's all we have really to go on

486
00:28:38,840 --> 00:28:39,400
Speaker 1: at the moment.

487
00:28:39,480 --> 00:28:41,640
Speaker 6: And one thing that I also want to point out is,

488
00:28:42,240 --> 00:28:47,840
Speaker 6: you know, NASA has really struggled in recent years to

489
00:28:47,880 --> 00:28:51,880
Speaker 6: pull off some of its big ambitious programs. Has had

490
00:28:51,880 --> 00:28:55,400
Speaker 6: a flat budget adjusted for inflation for the past few decades,

491
00:28:55,880 --> 00:28:59,280
Speaker 6: and SpaceX has really come in and enabled them to

492
00:28:59,360 --> 00:29:02,880
Speaker 6: pull off the these big exploration programs that they have been

493
00:29:02,960 --> 00:29:07,959
Speaker 6: eyeing for supposedly cheaper costs and on a quicker timeline,

494
00:29:08,080 --> 00:29:12,360
Speaker 6: And I think there is kind of reluctance to disturb

495
00:29:12,480 --> 00:29:17,480
Speaker 6: that status quo Elon being a part of that, because

496
00:29:17,600 --> 00:29:21,040
Speaker 6: it has been kind of this magical company that has

497
00:29:21,080 --> 00:29:24,000
Speaker 6: come in and really allowed them to do bold and

498
00:29:24,200 --> 00:29:27,560
Speaker 6: ambitious things, and so I think they just don't want

499
00:29:27,600 --> 00:29:29,000
Speaker 6: to rock that boat.

500
00:29:29,360 --> 00:29:32,160
Speaker 4: Josh Lauren, thank you very much for bringing us this

501
00:29:32,240 --> 00:29:33,320
Speaker 4: story and for joining us.

502
00:29:33,960 --> 00:29:35,680
Speaker 3: Thank you, thank you so much.

503
00:29:38,760 --> 00:29:42,440
Speaker 4: So Max and Dana are back with us. Oh you listeners,

504
00:29:42,440 --> 00:29:44,760
Speaker 4: You're so lucky, And we're going to talk some more

505
00:29:44,960 --> 00:29:49,200
Speaker 4: about that blistering rally in Tesla stock Max, as I

506
00:29:49,280 --> 00:29:52,200
Speaker 4: look at my screen here, it is now up for

507
00:29:52,320 --> 00:29:56,320
Speaker 4: the year, and it also looks like some big hedge

508
00:29:56,320 --> 00:29:59,040
Speaker 4: funds bet against it at the worst possible time.

509
00:29:59,480 --> 00:30:01,960
Speaker 2: Yeah, we've been talking about this for you know, a

510
00:30:01,960 --> 00:30:04,800
Speaker 2: few weeks now, but Elon Musk has had a few wins.

511
00:30:04,880 --> 00:30:08,240
Speaker 2: I mean, you know, this pay vote was certainly an

512
00:30:08,400 --> 00:30:12,040
Speaker 2: endorsement of his leadership at a time when there were

513
00:30:12,080 --> 00:30:14,040
Speaker 2: lots of questions passing easily.

514
00:30:14,840 --> 00:30:16,640
Speaker 4: Even if it doesn't actually leaven if it.

515
00:30:16,560 --> 00:30:18,960
Speaker 2: Doesn't actually lead to anything, does does kind of reaffirm

516
00:30:19,040 --> 00:30:21,640
Speaker 2: that that he's he's there, he's not leaving.

517
00:30:21,800 --> 00:30:23,040
Speaker 4: You know that investors like that.

518
00:30:23,640 --> 00:30:26,160
Speaker 2: You also had what really did not seem like a

519
00:30:26,160 --> 00:30:29,920
Speaker 2: great quarter, but that investors have managed to decide was

520
00:30:29,920 --> 00:30:34,360
Speaker 2: a great quarter because it narrowly beat expectations. I think, really,

521
00:30:34,400 --> 00:30:37,760
Speaker 2: what's going on for sales, Yes, I think what's really

522
00:30:37,760 --> 00:30:39,960
Speaker 2: going on is there's just it's like a ViBe's thing.

523
00:30:40,000 --> 00:30:43,880
Speaker 2: People are are feeling like the vibe has turned and

524
00:30:44,120 --> 00:30:48,680
Speaker 2: we have this big Robotaxi unveiling coming up, and everyone

525
00:30:48,720 --> 00:30:52,440
Speaker 2: has decided that like that's gonna be the thing that

526
00:30:52,600 --> 00:30:55,000
Speaker 2: fixes all the problems that we've been talking about. And

527
00:30:55,120 --> 00:30:57,920
Speaker 2: of course there's a very good case to take the

528
00:30:57,920 --> 00:31:00,560
Speaker 2: other side of that bet to to say, look like

529
00:31:00,840 --> 00:31:02,920
Speaker 2: not much has changed with the fundamentals as business.

530
00:31:03,120 --> 00:31:04,160
Speaker 4: This Robotaxi thing.

531
00:31:04,160 --> 00:31:07,280
Speaker 2: There's no quest there's no reason to think it's gonna,

532
00:31:07,680 --> 00:31:10,160
Speaker 2: you know, happen anytime soon. And I think that explains

533
00:31:10,160 --> 00:31:12,120
Speaker 2: why you have a lot of people shorting the stock.

534
00:31:12,400 --> 00:31:15,560
Speaker 2: But the really exciting thing about this, David, is that

535
00:31:15,680 --> 00:31:18,160
Speaker 2: this means that Elon Musk loves to stick it to

536
00:31:18,240 --> 00:31:21,280
Speaker 2: the shorts, So maybe we'll get some short shorts, some

537
00:31:21,360 --> 00:31:22,440
Speaker 2: new Tesla merch.

538
00:31:22,920 --> 00:31:26,160
Speaker 4: Yeah, I mean, Dan right, if you're ever gonna roll

539
00:31:26,200 --> 00:31:28,880
Speaker 4: the short shorts back out, and they are shorts that

540
00:31:28,920 --> 00:31:32,080
Speaker 4: Tesla had created and I believe was briefly selling to

541
00:31:32,080 --> 00:31:32,760
Speaker 4: pet and they were.

542
00:31:32,760 --> 00:31:35,400
Speaker 5: Like red and silk. Could I think, David, I mean,

543
00:31:35,560 --> 00:31:39,320
Speaker 5: I think if I'm recalling correctly, Elon Musk like mailed

544
00:31:39,320 --> 00:31:40,400
Speaker 5: them or something like.

545
00:31:40,320 --> 00:31:43,880
Speaker 4: You said, so, David Einhorn, who who was a big

546
00:31:43,960 --> 00:31:46,840
Speaker 4: you know, short for a long time. I suppose now

547
00:31:46,960 --> 00:31:50,400
Speaker 4: if they do crank him out again and again, part

548
00:31:50,400 --> 00:31:52,760
Speaker 4: of my thinking is Max right, if it's being so

549
00:31:53,000 --> 00:31:57,000
Speaker 4: darn hot out right now, if you're ever gonna reintroduce

550
00:31:57,040 --> 00:31:59,440
Speaker 4: some relaunch him, now's the time. I feel like he

551
00:31:59,480 --> 00:32:02,160
Speaker 4: should send some to Gates, even if Gates still isn't

552
00:32:02,160 --> 00:32:03,920
Speaker 4: shorting the stock, right, you know.

553
00:32:03,920 --> 00:32:06,680
Speaker 2: It's almost worth with this with the temperatures, it's almost

554
00:32:06,680 --> 00:32:08,480
Speaker 2: worth shorting the stock just to get.

555
00:32:09,000 --> 00:32:11,680
Speaker 5: I think they should be like black cyber cab or

556
00:32:11,840 --> 00:32:14,600
Speaker 5: cargo shorts, you know, like that's how they could maybe

557
00:32:14,600 --> 00:32:18,160
Speaker 5: market them. It could be like a robotex carbon short.

558
00:32:19,880 --> 00:32:22,160
Speaker 4: The problem is with black in the summer it's hot,

559
00:32:23,000 --> 00:32:26,240
Speaker 4: so the stock is up. Temperatures are up, the short

560
00:32:26,280 --> 00:32:28,680
Speaker 4: shorts are coming back, and Musk is happy.

561
00:32:28,760 --> 00:32:30,560
Speaker 2: I just want to say the stock is up on

562
00:32:30,600 --> 00:32:32,440
Speaker 2: the year if you back up, if you turn the

563
00:32:32,480 --> 00:32:36,480
Speaker 2: clock back two years to you know, November twenty one,

564
00:32:36,520 --> 00:32:38,640
Speaker 2: when the stock hit an all time high. It's still

565
00:32:38,920 --> 00:32:43,400
Speaker 2: way down from there, I think nearly forty percent. And

566
00:32:43,440 --> 00:32:47,240
Speaker 2: as Escha Day has mentioned on this podcast several times now,

567
00:32:47,480 --> 00:32:49,960
Speaker 2: it is a stock that swing swings around like there

568
00:32:50,560 --> 00:32:53,200
Speaker 2: are these big ups, big downs, Like I think you

569
00:32:53,240 --> 00:32:56,120
Speaker 2: don't want to read in too much to anything, especially

570
00:32:56,200 --> 00:32:59,320
Speaker 2: until we see you know what exactly happens at this Robotech.

571
00:32:59,480 --> 00:33:03,920
Speaker 4: Yeah, Dan, it's all signs point to the great Robotaxi launch.

572
00:33:04,640 --> 00:33:07,320
Speaker 5: Yes, but just to be clear, before the Robotaxi, we

573
00:33:07,320 --> 00:33:11,000
Speaker 5: have earnings Tuesday, July twenty third. And the reason why

574
00:33:11,040 --> 00:33:13,760
Speaker 5: the stock is up in part is because Tesla cleared

575
00:33:13,800 --> 00:33:16,880
Speaker 5: out a lot of inventory that was like an overhang

576
00:33:16,960 --> 00:33:18,840
Speaker 5: in Q one, so that's going to help them with

577
00:33:18,880 --> 00:33:22,360
Speaker 5: their margins. They're all excited about the Mega pack. Listeners,

578
00:33:22,400 --> 00:33:24,840
Speaker 5: we will do a Megapack special episode at some point.

579
00:33:25,000 --> 00:33:27,880
Speaker 4: The two hours all about the Mega Pack.

580
00:33:28,320 --> 00:33:30,000
Speaker 5: So the stock is up because the you know, the

581
00:33:30,040 --> 00:33:32,960
Speaker 5: earnings should be better because they they got rid of

582
00:33:32,960 --> 00:33:34,920
Speaker 5: all this inventory. So that's that's a big part of

583
00:33:34,960 --> 00:33:35,280
Speaker 5: it too.

584
00:33:35,360 --> 00:33:37,560
Speaker 4: But this is why it's very very important to have

585
00:33:37,640 --> 00:33:40,400
Speaker 4: you on the show because you keep us the task here.

586
00:33:40,640 --> 00:33:45,360
Speaker 5: Don't let your ROBOTAXI enthusiasm.

587
00:33:45,680 --> 00:33:48,480
Speaker 2: Do you really think though, that the dan you really

588
00:33:48,480 --> 00:33:50,600
Speaker 2: think the stock is getting run up like this because

589
00:33:50,600 --> 00:33:53,680
Speaker 2: of you know, inventories being I'm not sure I have

590
00:33:53,760 --> 00:33:56,880
Speaker 2: confidence that, like the market is as rational as that.

591
00:33:57,040 --> 00:33:57,440
Speaker 3: What I'm just.

592
00:33:57,400 --> 00:33:59,760
Speaker 5: Saying is, like, from a fundamental perspective, Q one was

593
00:33:59,760 --> 00:34:03,280
Speaker 5: a really lousy quarter because they they made more cars

594
00:34:03,320 --> 00:34:06,520
Speaker 5: than they could sell. In Q two, they sold more

595
00:34:06,600 --> 00:34:09,880
Speaker 5: cars than they made So all of these like old

596
00:34:10,000 --> 00:34:12,320
Speaker 5: model threes and model wise that were like sitting around

597
00:34:12,360 --> 00:34:15,000
Speaker 5: in parking lots, and the parking lot truthers were out

598
00:34:15,040 --> 00:34:18,840
Speaker 5: talking about this inventory build out that built that inventory

599
00:34:18,840 --> 00:34:21,480
Speaker 5: has now been cleared and that really helps Tesla because

600
00:34:21,520 --> 00:34:25,680
Speaker 5: Tesla does not have dealers. They sell cars directly to

601
00:34:25,719 --> 00:34:27,480
Speaker 5: their consumers, so then when they have a lot of

602
00:34:27,520 --> 00:34:30,160
Speaker 5: inventory sitting around that is just like a dead weight

603
00:34:30,239 --> 00:34:32,920
Speaker 5: on their balance sheets. So the fact that they managed

604
00:34:32,960 --> 00:34:35,759
Speaker 5: to clear this inventory helps them. Is that why the

605
00:34:35,800 --> 00:34:38,160
Speaker 5: stock is gone berserk? No, I mean the stock is

606
00:34:38,200 --> 00:34:40,520
Speaker 5: going doing what it's doing because everyone's excited to hear

607
00:34:40,560 --> 00:34:40,880
Speaker 5: about the.

608
00:34:40,880 --> 00:34:43,640
Speaker 4: Rover, about the Robotaxi, and and it's a moment. It's

609
00:34:43,640 --> 00:34:44,560
Speaker 4: a huge momentum for.

610
00:34:44,600 --> 00:34:46,759
Speaker 2: People are so excited they're just they're spinning up these

611
00:34:46,800 --> 00:34:48,520
Speaker 2: like crazy. I don't know if you all saw that

612
00:34:48,840 --> 00:34:51,560
Speaker 2: the big rumor among the Tesla enthusiasts was that he

613
00:34:51,600 --> 00:34:54,200
Speaker 2: had secretly hired Elon said, this is not true, that

614
00:34:54,239 --> 00:34:58,200
Speaker 2: he had secretly hired Uber founder Travis Kalanik to lead

615
00:34:58,280 --> 00:35:01,239
Speaker 2: the Robotaxi efforts to bring being the band of kind

616
00:35:01,320 --> 00:35:05,960
Speaker 2: of like slightly canceled figures together to usher us into

617
00:35:06,000 --> 00:35:08,600
Speaker 2: the new AI era. I'm sad it's not true, because

618
00:35:08,600 --> 00:35:10,839
Speaker 2: it would be fun to see Elon and Travis, those

619
00:35:10,840 --> 00:35:14,080
Speaker 2: are two very strong personalities come together.

620
00:35:14,560 --> 00:35:18,280
Speaker 4: All right, Absolutely, all should be revealed in one month.

621
00:35:18,600 --> 00:35:21,520
Speaker 4: And yeah, and we'll watch the stock in the meantime.

622
00:35:22,200 --> 00:35:25,960
Speaker 4: Max Dana, thanks as always, pleasure to be here at Gridgebier.

623
00:35:33,160 --> 00:35:36,640
Speaker 4: This episode was produced by Stacey Wong, Naomi Shaven and

624
00:35:36,719 --> 00:35:40,719
Speaker 4: Rayan Harmancia are senior editors. The idea for This very

625
00:35:40,800 --> 00:35:44,719
Speaker 4: show also came from Rayhon Blake Maples handles engineering, and

626
00:35:44,719 --> 00:35:48,280
Speaker 4: we get special editing assistants from Jeff Grocott, Antonio Muffarech

627
00:35:48,440 --> 00:35:53,080
Speaker 4: and Ourfat jalas show Perry. Our supervising producer is Magnus Hendrickson.

628
00:35:53,640 --> 00:35:56,480
Speaker 4: The Elon Inc. Theme is written and performed by Taka

629
00:35:56,560 --> 00:36:00,359
Speaker 4: Yasuzau and Alex sugi Era. Brendon Francis new them as

630
00:36:00,360 --> 00:36:02,440
Speaker 4: our executive producer, and Sage Bauman is the head of

631
00:36:02,480 --> 00:36:06,560
Speaker 4: Bloomberg Podcasts. A big thanks to our supporter Joel Weber.

632
00:36:06,880 --> 00:36:10,120
Speaker 4: I'm David Papadopolis. If you have a minute, rate and

633
00:36:10,200 --> 00:36:13,600
Speaker 4: review our show, it'll help other listeners find us. See

634
00:36:13,600 --> 00:36:15,400
Speaker 4: you next week.