For a long time organizations like the Southern Environmental Law Center (SELC) have noted how Elon Musk’s xAI data center in Memphis disproportionately pollutes the air in minority neighborhoods. A joint lawsuit by SELC, Earthjustice, and the NAACP filed last April argued that Musk and friends didn’t even bother to get the necessary permits to run the turbines at its xAI’s Colossus 2 data center.
The lawsuit also notes how these 27 turbines (which has ballooned to 57 turbines since the lawsuit was filed) belch all manner of contaminants, including formaldehyde, into minority neighborhoods already seeing some of the highest asthma rates in the country, violating the Clean Air Act.
But this being Elon Musk, he apparently has been able to leverage the presidency he helped purchase to get those pesky Memphis minorities off of his back. In a filing this week obtained by Wired, the DOJ is trying to claim the lawsuit can’t proceed because xAI and Grok are highly tethered to the country’s national security efforts:
“In a filing, the agency sided with Elon Musk’s company, saying attempts to stop xAI from running the natural gas turbines “threatens American national, economic, and energy security by seeking to shut off the power supply for artificial-intelligence innovation that supports the Department of War’s military operations.”
Musk and his friends at the DOJ are asking the courts to dismiss the lawsuit. In May, the NAACP filed a request for a preliminary injunction, stating that the climbing rates of environmental pollution “increases risks of asthma attacks and heart disease” in communities that already face significant pollution thanks to regulatory capture and systemic racism.
Over on Elon Musk’s right wing propaganda website, Marc Andreessen pretended to not understand why a civil rights group might be upset that unregulated data centers are pumping pollution into minority Memphis neighborhoods:
It’s worth noting that when Musk built the Colossus 2 data center near Memphis, he promised that the facility would largely re-use water via a next-generation water-recycling plant as to not strain the area water supply. But curiously, construction of that part of the project has stalled out completely. Musk says the company needs to focus on finishing their other data center in the region, then will finish construction. But, well, it’s Musk. The guy always saying we’re *this close* to settling Mars.
The youth movement has tethered AI to the country’s growing fascist, racist corruption and income inequality (and the tech sector that openly embraced it at almost every turn), and it’s going to take a lot more than sloppy CBS propaganda and new software updates to shift the perception. I’m not sure the tech sector truly groks what their enthusiastic support of Trumpism will ultimately reap them.
This is the future we’ve built in a country too corrupt to have functional regulatory oversight of obscenely rich men and corporate power. Without a meaningful ethical renaissance and profound political sea change, it only gets uglier and more violent from here.
Last week Elon Musk successfully conned America and U.S. regulators into signing off on his preposterous SpaceX IPO, which immediately generated Musk $75 billion by comically over-stating the value of SpaceX, xAI, and Starlink. Then bone-grafting the entire pile of bullshit to the U.S. economy and your retirement account under the pretense that space data centers and Mars colonization are just around the corner.
A handful of remaining useful journalists have repeatedly explained how xAI and Musk’s racist 5th place chatbot — which comprises the lion’s share of the ridiculous IPO valuation — is a gargantuan loser. Both SpaceX and xAI aren’t profitable and may never be, and the claims of Mars colonization and space data centers are unworkable bullshit designed to distract people with toddler-level critical thinking skills.
Anyway I’m sure it will go fine.
As a multi-decade telecom beat reporter I’d say I’m better positioned to talk about Starlink — the only actually profitable company in the SpaceX IPO prospectus (and that’s assuming Starlink is being honest about their financial numbers in a country too corrupt to have working financial regulators).
I’ve long noted how Starlink is great for people with no other options, but data has shown how it’s too congested to meaningfully scale. It’s also often too expensive for the sorts of Americans struggling with access. There’s also the problem with it ruining astronomical research and degrading the ozone layer. So Starlink is great for RVs or a guy with an extra cabin in the woods, but it’s not a miracle.
In terms of broadband policy, it’s supposed to be a niche solution. The kind of technology you use to fill in the gaps after you’ve pushed fiber, 5G, and fixed wireless out as far as you can into unserved areas.
But as I’ve mentioned previously, folks in the Trump administration and extended Rogan infotainment universe see Starlink as akin to magic. They think it’s just a sort of pixie dust you sprinkle over the entire of U.S. connectivity woes. There was a soggy Bulwark interview last week with Jason Calacanis that kind of reveals how deep the delusion goes in terms of what Starlink actually is:
The SpaceX IPO insists — and Calacanis dutifully believes — that it’s trivial for Starlink to jump from a niche satellite broadband solution with a little over 10 million subscribers to a massive economic powerhouse with 300-500 million subscribers. Calacanis waxes poetic about Starlink providing bandwidth to every phone in the world and surpassing even Netflix in terms of total subscribers.
But in a way that’s highly representative of modern Silicon Valley, Calacanis doesn’t actually care about how the tech works, or even if it works. Calacanis is interested in unchecked wealth accumulation, and propping up the unbridled profit-seeking of a personal friend.
The thing is: to meaningfully grow, Starlink will need to start seriously competing on price to counter competitors (like Amazon) coming into the space. But the cost of endlessly replacing LEO (low Earth orbit satellites) is immense (SpaceX says each satellite has a five year lifespan, but it’s arguably much lower). And ARPU is already dropping for Starlink as the company tries to drum up new subscribers.
Calacanis insists Starlink’s just a hop, skip, and a jump from being even bigger than Netflix. But for Starlink to even sniff those kinds of numbers, it would have to intensely compete with deeply-entrenched and politically-powerful telecom monopolies, and fiber optic broadband and 5G/6G networks less constrained by the rules of physics. They’ve also got to compete with a rising tide of community-owned fiber.
As Starlink grows its subscriber base, it’s not only going to see its ARPU drop faster, but data shows it’s going to run into new capacity constraints. That means more annoying network management practices that throttle video, limit services, and generally degrade performance. We’re already starting to see the impact of this with network slowdowns and “congestion fees” ranging upwards of $750 in some areas.
Anybody claiming that Starlink is the ticket to vast riches is either lying to you or doesn’t understand how the technology actually works. Even if it can maintain its success as a viable niche connectivity option useful in rural markets and global battlezones, the high cost of maintenance means this is never going to be a major money maker. Though they clearly hope it will prove to be a semi-useful backbone for a major pump and dump scheme.
The ace Elon Musk is holding is corruption and cronyism leading to regulatory favors and massive new subsidies, but it’s not clear even that’s going to be enough.
Cecilia Kang at the New York Times has an interesting article about how the Trump FCC has been doing cartwheels trying to prop up the Musk IPO — especially as it pertains to Starlink. That has included not just abandoning any meaningful regulatory oversight of “space junk” and orbital safety, but launching dodgy investigations into companies that hold spectrum Musk wants for himself.
Elon Musk bought himself a Presidency, and it continues to pay off handsomely:
“Carr has taken multiple actions for which Musk was the prime beneficiary,” said Blair Levin, an adviser to New Street Research, an investment research firm, and a former chief of staff at the F.C.C. He added that Starlink “has gotten a huge amount from the Trump administration and Carr.”
Carr has tried to justify his favoritism of Musk by saying he’s also rubber stamped the LEO satellite policy interests of Jeff Bezos and Amazon. But as we’ve consistently established around here, nothing Carr does is driven by any sort of good faith concern about the public interest.
The funny part is that the New York Times doesn’t even mention that the Trump administration has also hijacked the 2021 infrastructure bill to redirect potentially billions of dollars to Elon Musk and Jeff Bezos (I should have an upcoming feature on this over at The Verge). This is money being directed away from affordable fiber and toward two billionaires — for networks they already planned to build.
More specifically, the Trump NTIA under former Ted Cruz staffer Arielle Roth changed the language of the $42.5 billion Broadband, Equity, Access, and Deployment (BEAD) program so that Musk and Bezos would be the prime beneficiaries. They also stripped out any language requiring that internet access built with taxpayer money had to be affordable or equitably deployed with an eye on fairness.
Musk and Calacanis types try to brush functional oversight for taxpayer spending as unnecessary “wokeness.” But the ongoing BEAD saga involves an historic hijacking of Congressionally-mandated funds by bad faith actors; so it’s curious the New York Times didn’t think it was worth mentioning in a story about how unethically cozy the Trump administration and Musk are.
Like most of the SpaceX IPO this will all be proven out over time. Long after people have had their retirements account raided, or small towns have had their infrastructure hopes hijacked. Consumers, taxpayers, and labor will, as is usually the case, be left holding the bag. And the folks that made it possible will already be off to the next big thing leaving people of conscience to clean up the mess.
Elon Musk, business genius. When Elon Musk announced his plans to buy Twitter, some of his billionaire friends rushed to text him to say they’d throw whatever money they wanted into the deal. Larry Ellison casually offered “a billion… or whatever you recommend.” Marc Andreessen offered $250 million, no questions asked. This all came out in the lawsuit when Musk tried to back out of the deal:
Publicly, these billionaires insisted that Elon was a sure shot business genius who would easily make them much richer. Elon then sent around a presentation to other investors who would perhaps take a bit more convincing. The NY Times got its hands on Elon’s clearly pulled-out-of-his-ass projections. $26.4 billion in revenue by 2028! That included $12 billion from advertising, $10 billion from subscriptions and the rest from licensing.
Remember, at the time, Twitter’s ad revenue was decent: $4.51 billion in 2021 (its last full year as a public company) with another half a billion in licensing revenue. So Elon was suggesting he had the magic formula for massively increasing ad revenue and subscription revenue.
There was plenty of reporting over the last few years on how the opposite happened. Ad revenue absolutely tanked. It got so bad that the company started suing advertisers for not advertising on the newly renamed X (and threatening advertisers that choosing not to advertise would get them added to the lawsuit), pretending that it was some sort of antitrust violation. It took a court to point out that this was utter nonsense.
Anyway, given the private nature of X, we didn’t have any real official confirmation on some of the revenue numbers. But in the last year and a half, Elon has been merging his Xs. He merged X into xAI, then merged xAI into SpaceX. And now SpaceX has filed for a massive IPO, giving us an S1 with some financial information about how X is actually performing after all.
Of course, by merging all these companies, it gives Elon a bit of a chance to obfuscate the numbers. The user metrics, for example, show both users of X and xAI’s grok (which are not all the same). Also, somewhat ironically given Elon’s pretextual whining about how there were too many bots on Twitter, the S1 admits that a lot of the activity on X these days is almost certainly bots and they apparently have no way to break out how many humans still use the service:
“supported accounts” refers to, when used in the context of our X platform and Grok, a human, bot or similar account that logged into the X platform or Grok. The total number of supported accounts may include fake, spam or bot accounts if they are active.
Gosh. I thought you were taking over the site to get rid of all the bots and spam.
Anyhoo, now that we have some numbers, let’s compare them to what Elon sold his investors.
Remember, the plan was $26.4 billion by 2028. We’re more than halfway there. How’s it going? Well… when he combines xAI (grok) revenue with X revenue (so not even just breaking out X’s ad revenue)… we get… a total of $3.201 billion in 2025. So, just to put this in perspective… when he took over in 2022 he laid out a five year plan to take the company that had $4.5 billion in ad revenue the year before he bought it up to $12 billion in five years. Three years in and… it’s now somewhere pretty far below $3 billion. And they’re proud of the fact it’s finally started to go up again:
Revenue for the year ended December 31, 2025 increased by $581 million, or 22.2%, compared to the prior year ended December 31, 2024. This increase was primarily due to an increase in advertising revenue of $116 million as advertising spend increased from advertising partners on X and an increase in AI solutions and infrastructure revenue of $465 million.
So… from 2024 to 2025… they increased advertising revenue on X… by… $116 million, after knocking it down by somewhere in the range of $2 billion? BUSINESS GENIUS.
But, that’s okay. Part of the pitch was that he was going to get advertising to be less than 50% of Twitter’s revenue by 2028 because it was going to be replaced by a massive wave of subscription revenue. $10 billion by 2028! Musk predicted 69 million users of Twitter Blue (what became X Premium) by 2025 and 159 million in 2028. And then also another 104 million subscribers to a mysterious “X” subscription by 2028, which was not explained in the pitch. Even though this was before the rollout of ChatGPT, if we want to grant Elon credit to think he had already planned to launch an AI subscription service called “X” by then… how are we doing towards those numbers?
As of March 31, 2026, we reached approximately 6.3 million active paid subscribers, which was comprised of approximately 4.4 million X Premium and Premium+ paid subscribers and approximately 1.9 million SuperGrok, SuperGrok Heavy and SuperGrok Lite paid subscribers.
Leaving aside the Grok subscribers… they have… 4.4 million X Premium subscribers. That seems a bit short of the 69 million paid subscribers (which was almost certainly chosen because Musk is, emotionally, a 12-year-old boy). Once you combine that with the Grok subscribers (most of those plans cost significantly more than X Premium) and you get a grand total of… $365 million. Given the breakdown of X vs. Grok subscribers and the different pricing, X subscribers likely account for less than two-thirds of that revenue — call it under $250 million. That seems juuuuust a bit short of $10 billion.
His initial pitch to investors also projected that by 2028 the payments business would be bringing in over a billion dollars. It’s now 2025 and while the S1 mentions payments, it’s very much a future thing:
We plan to further broaden the value proposition of X through offerings like Money, a product we launched in beta in November 2025, which aims to expand platform utility by enabling payments and other financial services.
In the pitch to investors, the plan was to have that generating revenue by 2023. A bit behind schedule, it seems.
Also, part of the pitch was that all the debt he’d taken on would be paid back through free cash flow. He even says that by 2025 (hmm… last year…) the company would grow to $3.2 billion. Uh, not so close. Again, that almost matches the revenue number, but the cash flow was… decidedly negative. The entire AI part of the business lost over $6 billion last year. I don’t think Elon’s paying off the debt with free cash flow any time soon.
Look, obviously, forward looking projections and investor pitches are fantasies. They always are. That’s kind of the point. And also, obviously, the consumer AI/LLM race which really became a consumer phenomenon started right after Musk closed the purchase, and shifted the landscape somewhat. Also, obviously, by merging X into xAI and then merging that combined company into SpaceX, the various investors are likely to make out just fine (even if it is stacking multiple houses of cards on top of each other).
But, given how there was a group of Silicon Valley VCs and Wall Street banker types who absolutely insisted that Elon had a Midas touch and would absolutely know how to turn Twitter into revenue gold, it seems worth checking in on just how badly those plans failed. Yes, he’s been able to paper that over with mergers between companies he owns, but the actual numbers don’t lie.
So where does this leave the investors who lined up to hand Elon a few billion dollars, no questions asked? Probably fine, actually. The SpaceX IPO will almost certainly value the combined entity at a number that makes early Twitter/X investors more than whole. That’s what merging a struggling social network into a so-so AI startup into a deeply in debt (but in strong demand) rocket company will get you — the underlying failure gets laundered by the valuation of everything else in the stack.
But the operational track record is what it is. Twitter was generating $4.5 billion in ad revenue the year before Musk bought it. Three years into his five-year plan to reach $12 billion, the combined X/xAI advertising business is at somewhere under $3 billion — and that’s counting the separate AI business he launched after acquisition. The 69 million paid subscribers became 4.4 million. The $10 billion subscription business became $250 million. The payments business that was supposed to be generating revenue in 2023 just launched in beta in November 2025.
The “business genius” narrative was always doing a lot of work. Now we have the numbers. They don’t.
Elon Musk is desperate to dominate the Low-Earth-Orbit (LEO) satellite broadband market. So is Jeff Bezos. And now the two billionaires are engaged in proxy fights at Trump’s FCC over who’ll get the honor.
Amazon’s LEO offering, Project Leo, is significantly behind Musk’s Starlink, and has been rushing to build out its LEO satellite constellation. To slow down their pace, Musk’s Starlink has started complaining to the FCC, insisting that Amazon violated orbital debris requirements by launching satellites into orbital altitudes that are too high, increasing the risks to other satellites and spacecraft.
Amazon has responded by basically saying Musk’s Starlink is lying to slow the arrival of a competitor to market:
“SpaceX only objected to the launch parameters after moving its Starlink satellites into nearby altitudes, Amazon said. Changing the altitude of a recent Leo launch would have delayed it by months, according to Amazon. Both Amazon and SpaceX have accused each other of using Federal Communications Commission proceedings to delay the other’s satellite launches at various times over the years.”
Hoping to avoid harming “free market innovation,” it took years for the FCC to finally recently implement some bare bones “space junk” LEO collision guidance, though enforcement has been sporadic, and I’m doubtful two billionaire Trump donors will ever see much in the way of accountability.
Both billionaires are hoping to leverage their ongoing support of Trump to their own benefit. Both have already had significant success on that front; Musk and Bezos convinced the Trump administration to redirect billions in infrastructure bill subsidies (earmarked for reliable, faster fiber) over to their LEO satellite broadband businesses for service they already planned to deploy.
I’m not inclined to believe either billionaire or their companies. Nor am I inclined to believe that FCC boss Brendan Carr has the integrity or competence to manage this dispute or to protect the public longer term. Starlink has recently seen several satellites blow up in orbit and has been very murky about the reasons for it. Tens of thousands more LEO satellites are slated for launch in the next few years.
The grand irony is that the mad dash toward LEO satellite broadband doesn’t really deliver on the promise of significantly better broadband. LEO satellite connectivity is great for folks who have no other option, but the technology comes with a long list of caveats.
The resulting networks will be too congested to truly scale or provide real competition for local telecom monopolies. The resulting services are also routinely too expensive for the folks who currently can’t afford access. Then there’s the problem of LEO satellite launches harming astronomy research and the ozone layer, issues I suspect won’t be a priority for Bezos, Musk, or Carr.
I’d expect to see much more orbital (and terrestrial consumer) chaos in the years to come, given absolutely none of these folks tend to think too deeply about the public interest.
We’ve long noted how the 2021 infrastructure bill included $42.5 billion for broadband grants dubbed the Broadband, Equity, Access And Deployment (BEAD) program. The program wasn’t without its warts, but it had the potential to be truly transformative for U.S. broadband access.
But Republicans illegally rewrote the program to redirect money away from stuff like affordable, gigabit, community fiber, and into the pockets of billionaire Elon Musk. In exchange for congested, expensive, Low-Earth-Orbit (LEO) satellite broadband access the company planned to deploy anyway.
This alone was a pretty big grift. But Trump has also threatened to illegally withhold planed state broadband grants if they dare try to make sure the resulting taxpayer broadband is affordable, or attempt to hold companies accountable for failing to delivered promised service.
“The concessions sought by SpaceX “would limit Starlink’s performance obligations, payment schedules, non-compliance penalties, reporting expectations, and labor and insurance standards,” wrote Drew Garner, director of policy engagement at the Benton Institute. Garner argued that SpaceX’s demands illustrate problems in how the Trump NTIA rewrote program rules to increase reliance on low-Earth orbit (LEO) satellite providers.”
So basically Musk — who likes to pretend he hates subsidies despite his entire existence being propped up by them — wants untold billions in new subsidies and no serious way for his company to be held accountable should it fail to deliver the promised, substandard product.
Under a functional broadband grant program, states would push fiber as deeply into rural communities as possible, ideally in the form of “open access” fiber networks that generate local competition and challenge regional monopolies by dramatically lowering the cost of market entry. From there, you’d address the rest of the gaps using fixed wireless and 5G.
Only then would you fill in the remaining holes with Low Earth Orbit (LEO) satellite broadband options like Starlink, which are ideally suited only for the most remote areas (and even then, Starlink is generally too expensive for most of the lower-income rural Americans who really need it).
Republicans have, in an open act of corruption, thrown this entire logic on its head to curry favor with their favorite white supremacist extremist billionaire. They’re prioritizing Elon Musk’s substandard satellite network (which will only become more congested as more people use it), then ensuring nobody can meaningful hold Musk accountable when he inevitably fails to deliver reliable, affordable access.
Who is going to hold Musk accountable if he fails to deliver? Trump’s bootlicker at the FCC, Brendan Carr? The FTC, where Trump illegally fired all the Dem Commissioners? The NTIA, which is now run by a former Ted Cruz staffer who thinks affordable fiber optic broadband is “woke?” States, who risk losing out on a generational influx of subsidies if they challenge Elon Musk’s greed or stand up to telecoms?
Musk’s DOGE was always about destroying the regulatory state so he and other billionaires could sell the country for scrap off the back loading dock under the pretense of innovative efficiencies while being slathered with tax cuts and subsides. It’s grotesque, historic levels of corruption in a fucking hat.
The business and telecom press (and many folks in policy circles) have also already seemingly normalized hijacking a massive subsidy program to the benefit of a white supremacist billionaire. But as somebody that’s been studying the challenges of broadband access for a quarter century, I guarantee that we’re going to be documenting the damage (and lost potential) of this corruption for decades to come.
This story was originally published by ProPublica.Republished under a CC BY-NC-ND 3.0license.There are additional (exceptional!) imagery in the original.
When SpaceX CEO Elon Musk chose a remote Texas outpost on the Gulf Coast to develop his company’s ambitious Starship, he put the 400-foot rocket on a collision course with the commercial airline industry.
Each time SpaceX did a test run of Starship and its booster, dubbed Super Heavy, the megarocket’s flight path would take it soaring over busy Caribbean airspace before it reached the relative safety of the open Atlantic Ocean. The company planned as many as five such launches a year as it perfected the craft, a version of which is supposed to one day land on the moon.
The FAA, which also oversees commercial space launches, predicted the impact to the national airspace would be “minor or minimal,” akin to a weather event, the agency’s 2022 approval shows. No airport would need to close and no airplane would be denied access for “an extended period of time.”
But the reality has been far different. Last year, three of Starship’s five launches exploded at unexpected points on their flight paths, twice raining flaming debris over congested commercial airways and disrupting flights. And while no aircraft collided with rocket parts, pilots were forced to scramble for safety.
A ProPublica investigation, based on agency documents, interviews with pilots and passengers, air traffic control recordings and photos and videos of the events, found that by authorizing SpaceX to test its experimental rocket over busy airspace, the FAA accepted the inherent risk that the rocket might put airplane passengers in danger.
And once the rocket failed spectacularly and that risk became real, neither the FAA nor Secretary of Transportation Sean Duffy sought to revoke or suspend Starship’s license to launch, a move that is permitted when “necessary to protect the public health and safety.” Instead, the FAA allowed SpaceX to test even more prototypes over the same airspace, adding stress to the already-taxed air traffic control system each time it launched.
The first two Starship explosions last year forced the FAA to make real-time calls on where to clear airspace and for how long. Such emergency closures camewith little or no warning, ProPublica found, forcing pilots to suddenly upend their flight plans and change course in heavily trafficked airspace to get out of the way of falling debris. In one case, a plane with 283 people aboard ran low on fuel, prompting its pilot to declare an emergency and cross a designated debris zone to reach an airport.
The world’s largest pilots union told the FAA in October that such events call into question whether “a suitable process” is in place to respond to unexpected rocket mishaps.
“There is high potential for debris striking an aircraft resulting in devastating loss of the aircraft, flight crew, and passengers,” wrote Steve Jangelis, a pilot and aviation safety chair.
The FAA said in response to questions that it “limits the number of aircraft exposed to the hazards, making the likelihood of a catastrophic event extremely improbable.”
Yet for the public and the press, gauging that danger has been difficult. In fact, nearly a year after last January’s explosion, it remains unclear just how close Starship’s wreckage came to airplanes. SpaceX estimated where debris fell after each incident and reported that information to the federal government. But the company didn’t respond to ProPublica’s requests for that data, and the federal agencies that have seen it, including the FAA, haven’t released it. The agency told us that it was unaware of any other publicly available data on Starship debris.
In public remarks, Musk downplayed the risk posed by Starship. To caption a video of flaming debris in January, he wrote, “Entertainment is guaranteed!” and, after the March explosion, he posted, “Rockets are hard.” The company has been more measured, saying it learns from mistakes, which “help us improve Starship’s reliability.”
For airplanes traveling at high speeds, there is little margin for error. Research shows as little as 300 grams of debris — or two-thirds of a pound — “could catastrophically destroy an aircraft,” said Aaron Boley, a professor at the University of British Columbia who has studied the danger space objects pose to airplanes. Photographs of Starship pieces that washed up on beaches show items much bigger than that, including large, intact tanks.
“It doesn’t actually take that much material to cause a major problem to an aircraft,” Boley said.
In response to growing alarm over the rocket’s repeated failures, the FAA has expanded prelaunch airspace closures and offered pilots more warning of potential trouble spots. The agency said it also required SpaceX to conduct investigations into the incidents and to “implement numerous corrective actions to enhance public safety.” An FAA spokesperson referred ProPublica’s questions about what those corrective actions were to SpaceX, which did not respond to multiple requests for comment.
Experts say the FAA’s shifting approach telegraphs a disquieting truth about air safety as private companies increasingly push to use the skies as their laboratories: Regulators are learning as they go.
During last year’s Starship launches, the FAA was under pressure to fulfill a dual mandate: to regulate and promote the commercial space industry while keeping the flying public safe, ProPublica found. In his October letter, Jangelis called the arrangement “a direct conflict of interest.”
In an interview, Kelvin Coleman, who was head of FAA’s commercial space office during the launches, said his office determined that the risk from the mishaps “was within the acceptable limits of our regulations.”
But, he said, “as more launches are starting to take place, I think we have to take a real hard look at the tools that we have in place and how do we better integrate space launch into the airspace.”
“We Need to Protect the Airspace”
On Jan. 16, 2025, as SpaceX prepared to launch Starship 7 from Boca Chica, Texas, the government had to address the possibility the giant rocket would break up unexpectedly.
Using debris modeling and simulations, the U.S. Space Force, the branch of the military that deals with the nation’s space interests, helped the FAA draw the contours of theoretical “debris response areas” — no-fly zones that could be activated if Starship exploded.
With those plans in place, Starship Flight 7 lifted off at 5:37 p.m. EST. About seven minutes later, it achieved a notable feat: Its reusable booster rocket separated, flipped and returned to Earth, where giant mechanical arms caught it as SpaceX employees cheered.
But about 90 seconds later, as Starship’s upper stage continued to climb, SpaceX lost contact with it. The craft caught fire and exploded, far above Earth’s surface.
A pilot on a flight from Miami to Santo Domingo, Dominican Republic, recorded video of space debris visible from the cockpit while flying at 37,000 feet. Provided to ProPublica
Air traffic control’s communications came alive with surprised pilots who saw the accident, some of whom took photos and shot videos of the flaming streaks in the sky:
Pilot: I just got a major streak going for at least 60 miles, all these different colors. Just curious but — it looked like it was coming towards us, but obviously because of the distance …. Just letting you know. Controller: Can you, can you give an estimate on how far away it is?
Another controller warned a different pilot of debris in the area:
Controller: Due to a space vehicle mishap — a rocket launch that basically exploded between our airspace and Miami — I’m going to give you holding instructions because there was debris in the area, so I’m going to keep you away from it.
Two FAA safety inspectors were in Boca Chica to watch the launch at SpaceX’s mission control, said Coleman, who, for Flight 7, was on his laptop in Washington, D.C., receiving updates.
As wreckage descended rapidly toward airplanes’ flight paths over the Caribbean, the FAA activated a no-fly zone based on the vehicle’s last known position and prelaunch calculations. Air traffic controllers warned pilots to avoid the area, which stretched hundreds of miles over a ribbon of ocean roughly from the Bahamas to just east of St. Martin, covering portions of populated islands, including all of Turks and Caicos. While the U.S. controls some airspace in the region, it relies on other countries to cooperate when it recommends a closure.
The FAA also cordoned off a triangular zone south of Key West.
When a pilot asked when planes would be able to proceed through the area, a controller replied:
Controller: The only information I got is that the rocket exploded so we need to protect the airspace, and Miami and Domingo stopped taking aircraft.
There were at least 11 planes in the closed airspace when Starship exploded, and flight tracking data shows they hurried to move out of the way, clearing the area within 15 minutes. Such maneuvers aren’t without risk. “If many aircraft need to suddenly change their routing plans,” Boley said, “then it could cause additional stress” on an already taxed air traffic control system, “which can lead to errors.”
That wasn’t the end of the disruption though. The FAA kept the debris response area, or DRA, active for another 71 minutes, leaving some flights in a holding pattern over the Caribbean. Several began running low on fuel and some informed air traffic controllers that they needed to land.
“We haven’t got enough fuel to wait,” said one pilot for Iberia airlines who was en route from Madrid with 283 people on board.
The controller warned him that if he proceeded across the closed airspace, it would be at his own risk:
Controller: If you’re going to pass through the DRA, you guys’re going to need to declare an emergency. That’s what my supervisor — if you’re going to land at San Juan, you need to declare an emergency for fuel reasons, that’s what my supervisor just told me. Pilot: In that case, we declare emergency. Mayday mayday mayday.
The plane landed safely in San Juan, Puerto Rico.
Iberia did not respond to requests for comment, but in statements to ProPublica, other airlines downplayed the launch fallout. Delta, for example, said the incident “had minimal impact to our operation and no aircraft damage.” The company’s “safety management system and our safety culture help us address potential issues to reinforce that air transportation remains the safest form of travel in the world,” a spokesperson said.
After the incident, some pilots registered concerns with the FAA, which was also considering a request from SpaceX to increase the number of annual Starship launches from five to 25.
“Last night’s Space X rocket explosion, which caused the diversion of several flights operating over the Gulf of Mexico, was pretty eye opening and scary,” wrote Steve Kriese in comments to the FAA, saying he was a captain for a major airline and often flew over the Gulf. “I do not support the increase of rocket launches by Space X, until a thorough review can be conducted on the disaster that occurred last night, and safety measures can be put in place that keeps the flying public safe.”
Kriese could not be reached for comment.
The Air Line Pilots Association urged the FAA to suspend Starship testing until the root cause of the failure could be investigated and corrected. A letter from the group, which represents more than 80,000 pilots flying for 43 airlines, said flight crews traveling in the Caribbean didn’t know where planes might be at risk from rocket debris until after the explosion.
“By that time, it’s much too late for crews who are flying in the vicinity of the rocket operation, to be able to make a decision for the safe outcome of the flight,” wrote Jangelis, the pilot and aviation safety chair for the group. The explosion, he said, “raises additional concerns about whether the FAA is providing adequate separation of space operations from airline flights.”
In response, the FAA said it would “review existing processes and determine whether additional measures can be taken to improve situational awareness for flight crews prior to launch.”
According to FAA documents, the explosion propelled Starship fragments across an area nearly the size of New Jersey. Debris landed on beaches and roadways in Turks and Caicos. It also damaged a car. No one was injured.
Three months later, the National Oceanic and Atmospheric Administration, which was evaluating potential impacts to marine life, sent the FAA a report with a map of where debris from an explosion could fall during future Starship failures. The estimate, which incorporated SpaceX’s own data from the Starship 7 incident, depicted an area more than three times the size of the airspace closed by the FAA.
In a statement, an FAA spokesperson said NOAA’s map was “intended to cover multiple potential operations,” while the FAA’s safety analysis is for a “single actual launch.” A NOAA spokesperson said that the map reflects “the general area where mishaps could occur” and is not directly comparable with the FAA’s no-fly zones.
Nevertheless Moriba Jah, a professor of aerospace engineering at the University of Texas, said the illustration suggested the no-fly zones the FAA activated may not fully capture how far and wide debris spreads after a rocket breakup. The current predictive science, he said, “carries significant uncertainty.”
At an industry conference a few weeks after the January explosion, Shana Diez, a SpaceX executive, acknowledged the FAA’s challenges in overseeing commercial launches.
“The biggest thing that we really would like to work with them on in the future is improving their real time awareness of where the launch vehicles are and where the launch vehicles’ debris could end up,” she said.
“We’re Too Close to the Debris”
On Feb. 26 of last year, with the investigation into Starship Flight 7 still open, the FAA cleared Flight 8 to proceed, saying it “determined SpaceX met all safety, environmental and other licensing requirements.”
The action was allowed under a practice that began during the first Trump administration, known as “expedited return-to-flight,” that permitted commercial space companies to launch again even before the investigation into a prior problematic flight was complete, as long as safety systems were working properly.
Coleman, who took a voluntary separation offer last year, said that before granting approval, the FAA confirmed that “safety critical systems,” such as the rocket’s ability to self-destruct if it went off course, worked as designed during Flight 7.
By March 6, SpaceX was ready to launch again. This time the FAA gave pilots a heads-up an hour and 40 minutes before liftoff.
“In the event of a debris-generating space launch vehicle mishap, there is the potential for debris falling within an area,” the advisory said, again listing coordinates for two zones in the Gulf and Caribbean.
The FAA said a prelaunch safety analysis, which includes planning for potential debris, “incorporates lessons learned from previous flights.” The zone described in the agency’s advisory for the Caribbean was wider and longer than the previous one, while the area over the Gulf was significantly expanded.
Flight 8 launched at 6:30 p.m. EST and its booster returned to the launchpad as planned. But a little more than eight minutes into the flight, some of Starship’s engines cut out. The craft went into a spin and about 90 seconds later SpaceX lost touch with it and it exploded.
The FAA activated the no-fly zones less than two minutes later, using the same coordinates it had released prelaunch.
Even with the advance warning, data shows at least five planes were in the debris zones at the time of the explosion, and they all cleared the airspace in a matter of minutes.
A pilot on one of those planes, Frontier Flight 081, told passengers they could see the rocket explosion out the right-side windows. Dane Siler and Mariah Davenport, who were heading home to the Midwest after vacationing in the Dominican Republic, lifted the window shade and saw debris blazing across the sky, with one spot brighter than the rest.
“It literally looked like the sun coming out,” Siler told ProPublica. “It was super bright.”
They and other passengers shot videos, marveling at what looked like fireworks, the couple said. The Starship fragments appeared to be higher than the plane, many miles off. But before long, the pilot announced “I’m sorry to report that we have to turn around because we’re too close to the debris,” Siler said.
Frontier did not respond to requests for comment.
The FAA lifted the restriction on planes flying through the debris zone about 30 minutes after Starship exploded, much sooner than it had in January. The agency said that the Space Force had “notified the FAA that all debris was down approximately 30 minutes after the Starship Flight 8 anomaly.”
But in response to ProPublica’s questions, the Space Force acknowledged that it did not track the debris in real time. Instead, it said “computational modeling,” along with other scientific measures, allowed the agency to “predict and mitigate risks effectively.” The FAA said “the aircraft were not at risk” during the aftermath of Flight 8.
Experts told ProPublica that the science underlying such modeling is far from settled, and the government’s ability to anticipate how debris will behave after an explosion like Starship’s is limited. “You’re not going to find anybody who’s going to be able to answer that question with any precision,” said John Crassidis, an aerospace engineering professor at the University of Buffalo. “At best, you have an educated guess. At worst, it’s just a potshot.”
Where pieces fall — and how long they take to land — depends on many factors, including atmospheric winds and the size, shape and type of material involved, experts said.
During the breakup of Flight 7, the FAA kept airspace closed for roughly 86 minutes. However, Diez, the SpaceX executive, told attendees at the industry conference that, in fact, it had taken “hours” for all the debris to reach the ground. The FAA, SpaceX and Diez did not respond to follow-up questions about her remarks.
It’s unclear how accurate the FAA’s debris projections were for the March explosion. The agency acknowledged that debris fell in the Bahamas, but it did not provide ProPublica the exact location, making it impossible to determine whether the wreckage landed where the FAA expected. While some of the country’s islands were within the boundaries of the designated debris zone, most were not. Calls and emails to Bahamas officials were not returned.
The FAA said no injuries or serious property damage occurred.
FAA Greenlights More Launches
By May, after months of Musk’s Department of Government Efficiency slashing spending and firing workers at federal agencies across Washington, the FAA granted SpaceX’s request to exponentially increase the number of Starship launches from Texas.
Starship is key to “delivering greater access to space and enabling cost-effective delivery of cargo and people to the Moon and Mars,” the FAA found. The agency said it will make sure parties involved “are taking steps to ensure the safe, efficient, and equitable use” of national airspace.
The U.S. is in a race to beat China to the lunar surface — a priority set by Trump’s first administration and continued under President Joe Biden. Supporters say the moon can be mined for resources like water and rare earth metals, and can offer a place to test new technologies. It could also serve as a stepping stone for more distant destinations, enabling Musk to achieve his longstanding goal of bringing humans to Mars.
Trump pledged last January that the U.S. will “pursue our Manifest Destiny into the stars, launching American astronauts to plant the Stars and Stripes on the planet Mars.”
But with experimental launches like Starship’s, Jangelis said, the FAA should be “as conservative as possible” when managing the airspace below them.
“We expect the FAA to make sure our aircraft and our passengers stay safe,” he said. “There has to be a balance between the for-profit space business and the for-profit airlines and commerce.”
A More Conservative Approach
In mid-May, United Kingdom officials sent a letter to their U.S. counterparts, asking that SpaceX and the FAA change Starship’s flight path or take other precautions because they were worried about the safety of their Caribbean territories.
The following day, the FAA announced in a news release that it had approved the next Starship launch, pending either the agency’s closure of the investigation into Flight 8 or granting of a “return to flight” determination.
A week later, with the investigation into Flight 8 still open, the agency said SpaceX had “satisfactorily addressed” the causes of the mishap. The FAA did not detail what those causes were at the time but said it would verify that the company implemented all necessary “corrective actions.”
This time the FAA was more aggressive on air safety.
The agency preventively closed an extensive swath of airspace extending 1,600 nautical miles from the launch site, across the Gulf of Mexico and through part of the Caribbean. The FAA said that 175 flights or more could be affected, and it advised Turks and Caicos’ Providenciales International Airport to close during the launch.
The agency said the move was driven in part by an “updated flight safety analysis” and SpaceX’s decision to reuse a previously launched Super Heavy booster — something the company had never tried before. The agency also said it was “in close contact and collaboration with the United Kingdom, Turks & Caicos Islands, Bahamas, Mexico, and Cuba.”
Coleman told ProPublica that the concerns of the Caribbean countries, along with Starship’s prior failures, helped convince the FAA to close more airspace ahead of Flight 9.
On May 27, the craft lifted off at 7:36 p.m. EDT, an hour later than in March and two hours later than in January. The FAA said it required the launch window to be scheduled during “non-peak transit periods.”
This mission, too, ended in failure.
Starship’s Super Heavy booster blew up over the Gulf of Mexico, where it was supposed to have made what’s called a “hard splashdown.”
In response, the FAA again activated an emergency no-fly zone. Most aircraft had already been rerouted around the closed airspace, but the agency said it diverted one plane and put another in a holding pattern for 24 minutes. The FAA did not provide additional details on the flights.
According to the agency, no debris fell outside the hazard area where the FAA had closed airspace. Pieces from the booster eventually washed up on Mexico’s beaches.
Starship’s upper stage reached the highest planned point in its flight path, but it went into a spin on the way down, blowing up over the Indian Ocean.
The Path Ahead
A map released by the FAA shows potential no-fly zones planned for future Starship launches that would cross over a portion of Florida. Air hazard areas — the AHAs on this map — are paths that would be cleared of air traffic before launches. Federal Aviation Administration
SpaceX launched Starship again in August and October. Unlike the prior flights, both went off without incident, and the company said it was turning its focus to the next generation of Starship to provide “service to Earth orbit, the Moon, Mars, and beyond.”
But about a week later, Transportation Secretary Sean Duffy said he would open up SpaceX’s multibillion-dollar contract for a crewed lunar lander to rival companies. SpaceX is “an amazing company,” he said on CNBC. “The problem is, they’re behind.”
Musk pushed back, saying on X that “SpaceX is moving like lightning compared to the rest of the space industry.” He insulted Duffy, calling him “Sean Dummy” and saying “The personresponsible for America’s space program can’t have a 2 digit IQ.”
The Department of Transportation did not respond to a request for comment or make Duffy available.
In a web post on Oct. 30, SpaceX said it was proposing “a simplified mission architecture and concept of operations” that would “result in a faster return to the Moon while simultaneously improving crew safety.”
SpaceX is now seeking FAA approval to add new trajectories as Starship strives to reach orbit. Under the plan, the rocket would fly over land in Florida and Mexico, as well as the airspace of Cuba, Jamaica and the Cayman Islands, likely disrupting hundreds of flights.
In its letter, the pilots’ union told the FAA that testing Starship “over a densely populated area should not be allowed (given the dubious failure record)” until the craft becomes more reliable. The planned air closures could prove “crippling” for the Central Florida aviation network, it added.
Still, SpaceX is undeterred.
Diez, the company executive, said on X in October, “We are putting in the work to make 2026 an epic year for Starship.”
We’ve noted how Republicans are rewriting the 2021 infrastructure bill (they voted against) to ensure that billions of dollars in taxpayer-funded broadband grants wind up in the back pocket of Elon Musk and Jeff Bezos (and their low-Earth orbit (LEO) satellite broadband ventures, Starlink and Project Kuiper). This is billions of taxpayer dollars being paid to billionaires in exchange for doing nothing differently.
Republicans are framing this as something that’s going to save taxpayers money, but it’s a lie.
At up to $120 a month for a “real” plan at next-generation speeds, plus hundreds of dollars in up front hardware fees, the service is too expensive for most of the Americans desperate to be connected. Apparently aware of the criticism that taxpayers were giving billions of dollars to a billionaire for a system many people can’t afford, Starlink briefly introduced a slower, $40 monthly tier.
“The 100Mbps plan was not widely available, as it seemed to pop up in a relatively small number of areas where Starlink likely had excess network capacity. Some customers speculate that new users and existing subscribers scrambled to take advantage of the bargain deal, which caused Starlink to reach capacity in the eligible areas. The plan stood out for its low price while capping download speeds to 100Mbps.”
Starlink also imposes massive “congestion fees” in areas where it lacks capacity. These fees can be upwards of $750 in some areas. So again, you can probably see why it’s a bad idea for Republicans to treat Starlink as a connectivity panacea while showering it with subsidies that could be going to better, more affordable, higher capacity options.
Ideally, if you’re going to throw billions of subsidies at U.S. broadband, your technology priority should be fiber (preferably open access, community owned to counter monopoly dominance), wireless (either fixed or 5G), and then LEO satellite to fill in the gaps. Instead, Republicans are putting Starlink at the front of the line, and Musk and friends are whining about and harassing states that balk at this dumb idea.
Back in June, researchers showed in detail that given the limited nature of satellite physics, the more people that use Starlink, the slower the network is going to get. What, exactly, do folks think is going to happen when the network sees a mass infusion of taxpayer subsidized advertisement and usage?
To be clear: Starlink is great if you have no other options and can afford it. But it shouldn’t be the top priority in a historic round of taxpayer subsidies. That’s just begging for trouble down the road. But Republicans are so excited to throw billions of new dollars at their white supremacist billionaire godbaby, they don’t really care about the actual real world impact at the other end of the line.
This story was originally published by the Texas Tribune and the Texas Newsroom and co-published with ProPublica. Republished under the Texas Tribune’s republish feature.
Months after fighting to keep secret the emails exchanged between Texas Gov. Greg Abbott’s office and tech billionaire Elon Musk’s companies, state officials released nearly 1,400 pages to The Texas Newsroom.
The records, however, reveal little about the two men’s relationship or Musk’s influence over state government. In fact, all but about 200 of the pages are entirely blacked out.
Of those that were readable, many were either already public or provided minimal information. They included old incorporation records for Musk’s rocket company SpaceX, a couple of agendas for the governor’s committee on aerospace and aviation, emails regarding a state grant awarded to SpaceX and an application from a then-Musk employee to sit on a state commission.
One is an invitation to happy hour. Another is a reminder of the next SpaceX launch.
The documents were provided in response to a public records request by The Texas Newsroom, which asked Abbott’s office for communications with Musk and the businessman’s employees dating back to last fall. Abbott’s and Musk’s lawyers fought their release, arguing they would reveal trade secrets, potentially “intimate and embarrassing” exchanges or confidential legal and policymaking discussions.
Abbott’s spokesperson, Andrew Mahaleris, said the governor’s office “rigorously complies with the Texas Public Information Act and releases any responsive information that is determined to not be confidential or excepted from disclosure.”
Open government experts say the limited disclosure is emblematic of a larger transparency problem in Texas. They pointed to a 2015 state Supreme Court decision that allowed companies to oppose the release of records by arguing that they contain “competitively sensitive” information. The ruling, experts said, made it harder to obtain records documenting interactions between governments and private companies.
Tom Leatherbury, who directs the First Amendment Clinic at Southern Methodist University’s Dedman School of Law, said companies took advantage of the ruling. Among the most prominent examples of the ruling’s effect on transparency was McAllen’s refusal to disclose how much money was spent to lure pop star Enrique Iglesias to the city for a concert. The city argued that such disclosures would hurt its ability to negotiate with artists for future performances. Eventually, it was revealed that Iglesias was paid nearly half a million dollars.
The problem has been exacerbated, Leatherbury added, by the fact that the Office of the Attorney General, which referees public records disputes, does not have the power to investigate whether the records that companies want to withhold actually contain trade secrets.
“Corporations are willing to assert that information is confidential, commercial information, and more governmental bodies are willing not to second-guess the company’s assertion,” Leatherbury said. (Leatherbury has performed pro bono legal work for The Texas Newsroom.)
Musk and his companies’ representatives did not respond to questions about the records.
As part of an effort to track Musk’s clout in the state Capitol, The Texas Newsroom on April 20 asked Abbott’s office for communications with employees from four of the businessman’s companies: SpaceX, car manufacturer Tesla, the social media site X and Neuralink, which specializes in brain nanotechnology.
The governor’s office said it would cost $244.64 to review the documents, which The Texas Newsroom paid. After the check was cashed, lawyers representing Abbott’s office and SpaceX each sought to keep the records secret.
SpaceX’s lawyer sent a letter to Texas Attorney General Ken Paxton dated June 26, saying that publicly releasing the emails would hurt its competitive advantage.
Abbott’s public information coordinator, Matthew Taylor, also asked Paxton’s office for permission to withhold the documents, arguing they included private exchanges with lawyers, details about policymaking decisions and information that would reveal how the state entices companies to invest here. Taylor said some of the records were protected under an exception to public records laws known as “common-law privacy” because they consisted of “information that is intimate and embarrassing and not of legitimate concern to the public.”
Releasing the Musk emails, he said, would have a “chilling effect on the frank and open discussion necessary for the decision-making process.”
Ultimately, Paxton’s office mostly sided with Abbott and Musk. In a Aug. 11 opinion, Assistant Attorney General Erin Groff wrote that many of the documents could be withheld. Groff, however, ordered the release of some records determined to be “either not highly intimate or embarrassing” or of “legitimate public interest.”
A month later, the governor’s office released 1,374 pages of records, the vast majority of which were completely redacted.
Some records included a note that appeared to explain why. A note on page 401, for example, cited the exemption for competitive bidding records for 974 redacted pages. Names and emails of Musk’s employees were also removed.
“The fact that a governmental body can redact more than 1,000 pages of documents that are directly related to a major business’s activities in Texas is certainly problematic,” said Reid Pillifant, an attorney specializing in public records and media law. (Pillifant has represented a coalition of media outlets, including ProPublica and The Texas Tribune, in lawsuits seeking the release of public information related to the May 2022 mass shooting at an Uvalde elementary school.)
He and other experts said such hurdles are becoming more common as legislation and court decisions have weakened the state’s public records laws.
Four years after the 2015 Supreme Court decision, legislators passed a new law that was meant to ensure the release of basic information about government deals with private businesses. But open government experts said the law did not go far enough to restore transparency, adding that some local governments are still objecting to the release of contract information.
Moreover, lawmakers continue to add carve-outs to what qualifies as public information every legislative session. Just this year, for example, legislators added the following exceptions to public records and open meetings laws: information relating to how government entities detect and deter fraud and discussions during public government meetings about certain military and aerospace issues.
Even with the increasing challenges of accessing public records, Leatherbury and Pillifant were stumped by the governor’s decision to release thousands of pages only to black them out fully. Leatherbury said that the governor’s office may have wanted to show the volume of records responsive to the request.
“They wanted you to see what little you could get in the context of the entire document, even though that’s kind of meaningless,” he said.
The Texas Newsroom has asked the Office of the Attorney General to reconsider its decision and order the release of the Musk emails. There is little other recourse to challenge the outcome.
If a member of the public believes a government agency is violating the law, they can try to sue. But the experts noted that a recent Texas Supreme Court decision made it more difficult to enforce the public records law against the governor and other executive officers. Now, Leatherbury said, it’s not clear how challenging such a records decision would work.
“Every Texas citizen should care about access to these kinds of records because they shed light on how our public officials are making big decisions that affect the land where people live and how their taxpayer dollars are being spent,” Pillifant said.
Lauren McGaughy is a journalist with The Texas Newsroom, a collaboration among NPR and the public radio stations in Texas. She is based at KUT News in Austin. Reach her at lmcgaughy@kut.org. Sign up for KUT newsletters.
Way back in Trump’s first term, back when he was still claiming he was going to build some enormous border wall and get Mexico to pay for it (neither happened), the lovely people over at Cards Against Humanity bought a parcel of land along the boarder with the intention of taking every possible action to prevent a wall being built upon it. It was part of a marketing campaign where a percentage of sales of the game would go to buying the land, which eventually happened in 2017. And that’s where things stood for the rest of Trump’s term and all the way up to 2024. No wall was built on the land, Mexico paid for nothing, and the land remained empty.
Until, that is, SpaceX decided to dump a bunch of trash on it. The Elon Musk-owned company has a fabrication plant nearby and apparently just decided to use someone else’s property to dump a bunch of construction materials and trash. The irony that a parcel of land that was bought to keep a border wall from being built to keep out foreign trespassers that was instead trespassed upon domestically is not lost on me.
Well, CAH sued for $15 million and seemed like it had a very good case. SpaceX must have eventually agreed, as they have now settled the case days before the trial was set to begin.
A court document shows that SpaceX admitted it did not ask for or receive permission to use the property. SpaceX admitted that its “contractors cleared the lot and put down gravel,” parked vehicles on the property, and stored construction materials. An Associated Press article yesterday said that “Texas court records show a settlement was reached in the case last month, just weeks before a jury trial was scheduled to begin on Nov. 3.”
The game company said a victory at trial wouldn’t have resulted in a better outcome. “A trial would have cost more than what we were likely to win from SpaceX,” the company’s statement to Ars said. “Under Texas law, even if we had won at trial (and we would have, given their admission to trespassing), we likely wouldn’t have been able to recoup our legal fees. And SpaceX certainly seemed ready to dramatically outspend us on lawyers.”
Given that the details of the settlement are annoyingly confidential, we can’t really suss out just how just this outcome is. But the folks over at CAH seem to be satisfied, so I have to imagine at least a decent amount of money changed hands here. Still, part of the idea here was supposed to be sending money won from Musk to all the donors to the campaign, but it appears the settlement money won’t be enough to do so in an update CAH provided publicly.
Dear Horrible Friends,
Remember last year, when we sued Elon Musk for dumping space garbage all over your land, and then you signed up to collect your share of the proceeds? Also, remember how we warned you that we’d “probably only be able to get you like two dollars or most likely nothing”?
Well, Elon Musk’s team admitted on the record that they illegally trespassed on your land, and then they packed up the space garbage and fucked off. But when it comes to paying you all, he did the legal equivalent of throwing dust in our eyes and kicking us in the balls.
So while we can’t give you what you really wanted––cash money from Elon Musk––we’re going to make it up to you, our best, sexiest customers…with comedy! We’re sending you each a brand new mini-pack of exclusive cards all about Elon Musk, which you can sign up to receive for free right here.
You’ve got to give it to these folks: they’re never not on brand.
Sequoia Capital just showed us exactly what “institutional neutrality” means—when billions are at stake.
Sumaiya Balbale—the firm’s chief operating officer, a Shake Shack board member, someone “well regarded internally and by the start-ups she worked with as an experienced operating executive”—resigned in August after complaining about partner Shaun Maguire’s Islamophobic posts. Senior partners declined to discipline him, citing free speech. Her position became untenable. She left.
Maguire stays. Because his bet on SpaceX netted Sequoia roughly $4 billion on paper—earning him “a lot of rope” at the firm.
Let’s be precise about what happened. Maguire wrote on X that New York mayoral candidate Zohran Mamdani “comes from a culture that lies about everything. It’s literally a virtue to lie if it advances his Islamist agenda. The West will learn this lesson the hard way.”
This wasn’t his first offense. He’d endorsed Germany’s far-right AfD party—prompting London-based partner Luciana Lixandru to publicly distance herself, writing she felt “compelled” to share that “extremism on either side” is dangerous. He’d endorsed Tommy Robinson, a convicted criminal and UK anti-immigration activist. He’d accumulated enough controversial statements that more than 1,000 founders and tech employees signed an open letter demanding discipline.
Balbale—a practicing Muslim who has spoken publicly about how her gender, ethnicity, and faith shaped her career—complained to senior partners. They told her Maguire was exercising free speech. She resigned. Balbale walked out not because she couldn’t handle internal bias, but because the firm chose not to act. That tells you everything.
The asymmetry reveals the calculation.
When your COO complains that a partner’s Islamophobia creates a hostile environment, the firm’s version of “institutional neutrality” means she leaves. When that partner’s posts cause private complaints from portfolio company executives and institutional investors, when Middle Eastern sovereign wealth funds say “he is not welcome here,” when a financier calls his behavior “a humiliation”—institutional neutrality means he stays.
Because SpaceX returns are good.
This isn’t neutrality. This is a choice about whose value to the firm matters more. And Sequoia decided: $4 billion in paper gains from betting on Elon Musk outweigh retaining your chief operating officer, maintaining relationships with Middle Eastern capital, and avoiding the reputational damage of 1,000+ founders demanding accountability.
Managing partner Roelof Botha—who has described the firm’s approach as “institutional neutrality” where “staff are entitled to their own positions”—held an all-hands meeting to “keep peace internally” while “trying to limit wider fallout by not commenting publicly.” Translation: we know this is indefensible, we’re hoping it blows over, and we’re not taking action because Maguire’s returns matter more than our stated principles.
But neutrality would mean consistent standards. It would mean either everyone can post inflammatory political content without consequence, or no one can. What Sequoia actually practices is selective tolerance calibrated to financial returns and network positioning.
Maguire replied to Lixandru’s criticism of his AfD endorsement: “One of the beautiful things about Sequoia is that we’re comfortable disagreeing with each other. Personally I think it’s the secret to the firm’s historical investment success.”
That framing is instructive. “Disagreement” suggests a marketplace of ideas where different perspectives coexist productively. But when one person endorses far-right extremists and another says that’s dangerous, and the firm protects the first while losing the second—that’s not comfortable disagreement. That’s a choice about which positions are tolerable.
One Middle Eastern financier told the Financial Times: “You work for your limited partners and founders, you are entrusted with serious capital by investors. This is not good for the brand.”
Except it might be exactly the brand Sequoia is building—one aligned with what many observers see as the Musk/Thiel ecosystem where democracy is treated as failed experiment and hierarchy as inevitable solution. Losing Middle Eastern LPs becomes acceptable if you’re gaining position in networks where SpaceX access and Musk proximity matter more than sovereign wealth fund relationships.
This case is specific to Sequoia, but it suggests a broader pattern emerging across Silicon Valley venture capital—where political tolerance gets calibrated to returns, where “institutional neutrality” becomes cover for protecting positions that serve certain networks, where the choice between principle and profit consistently resolves the same way.
Sumaiya Balbale walking out the door while Shaun Maguire keeps his partnership isn’t a scandal Sequoia is managing. It’s a decision Sequoia made—about whose presence matters, whose complaints count, and which political positions are compatible with partnership.
The firm decided a Muslim COO objecting to Islamophobia was more expendable than a partner whose extremism alienates sovereign wealth funds but who made them billions betting on Elon Musk.
Sequoia didn’t remain neutral. It sided. And the side it chose is clear: profit first, principle second. Fair enough. But that’s not neutral.
It’s a choice.
Mike Brock is a former tech exec who was on the leadership team at Block. Originally published at his Notes From the Circus.
