Elon Musk's status as the wealthiest individual globally can be attributed not only to the groundbreaking innovations of his companies but also to government contracts and initiatives that have significantly impacted his two primary ventures: electric vehicles and space exploration.

With President-elect Donald Trump appointing the Tesla and SpaceX CEO to the task of streamlining the federal government's operations, Musk is poised to influence policies across a broad spectrum, including those that directly pertain to his own business interests.

For instance, Musk and Trump recently observed SpaceX's launch of a rocket designed to potentially transport humans to the moon and Mars in the future. The financial success of SpaceX is heavily contingent upon the extent of U.S. investment in such endeavors.

It is pertinent to question the extent to which Musk's formidable net worth has been bolstered by government assistance over the past decade or so. The answer is multifaceted. While some assessments suggest that only a fraction of his wealth is taxpayer-funded, others argue that virtually all of it can be traced back to government support.

Tesla and SpaceX owe their inception and survival during their formative years to state and federal policies, government contracts, and loans. "The foundation for Musk's financial success has been the US government," remarked Daniel Ives, a tech analyst at Wedbush Securities. The valuation of Tesla and SpaceX is not predicated on their current profits but rather on the anticipated future value, such as Tesla's publicly traded stock and private funding rounds for SpaceX. Since Trump's election, Musk's net worth has reportedly surged by $64 billion, or nearly 25%, as estimated by Bloomberg. This increase is partly due to the expectation that future growth will be facilitated by Musk's counsel on various topics, including artificial intelligence, autonomous vehicles, and funding for agencies that have previously posed regulatory challenges to his companies.

Tesla has historically received relatively modest government contracts. However, it received critical support during its early stages. In January 2010, with fewer than 2,000 cars sold in its history, Tesla secured a $465 million low-interest loan from the Department of Energy, just months prior to its initial public offering. This loan enabled the development of the Model S, Tesla's first major success, and was repaid early through additional stock sales in 2013. As Tesla began to sell vehicles, a $7,500 tax credit for electric vehicle (EV) buyers allowed the company and other automakers to sell American-made EVs at higher prices than the market might have otherwise permitted. Tesla buyers received federal tax credits worth an estimated $3.4 billion before this benefit was completely phased out for Tesla buyers by the end of 2019. Even if this credit only enabled Tesla to raise prices by half that amount, it represented an additional $1.7 billion in federal assistance during a period when the company was facing financial strain. The tax credit was reinstated in 2023 as part of the Biden administration's Inflation Reduction Act.

However, Musk has encouraged the incoming Trump administration to end the $7,500 tax credit, a move that, while seemingly contrary to Tesla's interests, would disadvantage established automakers vying for a share of the U.S. EV market. These legacy automakers would either have to accept larger losses on their EV sales or reduce their offerings, thereby diminishing competition for Tesla. "Take away the subsidies, it will only help Tesla," Musk stated on his social media platform X in July. However, Tesla's most significant financial support does not come from tax credits for EV buyers but rather from the sale of regulatory credits purchased by other automakers to comply with state and federal regulations aimed at reducing greenhouse gas emissions. While this money does not originate from taxpayers, without government regulation, there would be no billions flowing into Tesla's coffers. These credit sales were instrumental in keeping Tesla afloat during its early years, accounting for nearly 25% of its revenue in 2008 and 10% over the subsequent five years.

Between 2008 and 2019, sales of regulatory credits generated over $2 billion for the company. Without these funds, Tesla might have ceased to exist. Musk himself acknowledged in a 2020 tweet that Tesla was nearly forced to file for bankruptcy as recently as 2019, with the stock price struggling as the company faced difficulties in ramping up production of its Model 3 sedan. "Closest we got (to bankruptcy) was about a month," he said in the tweet.

"The Model 3 ramp was extreme stress & pain for a long time — from mid 2017 to mid 2019. Production & logistics hell." It was not until 2021 that Tesla was able to post a profit without the assistance of credit sales. In Tesla's history, sales of regulatory credits have brought in nearly $11 billion, with all of it directly contributing to its bottom line. "If it didn’t have regulatory credits, Tesla would not be the brand it is around the globe and Musk wouldn’t be the richest person in the world," said Ives, who is currently bullish on Tesla shares.

In 2019, he was still skeptical. Even without his shares and options in Tesla, Musk would likely still be worth over $100 billion and one of the wealthiest individuals on the planet. SpaceX is expected to be valued at approximately $250 billion in an upcoming round of funding from investors. Ives estimates that, while SpaceX has not disclosed Musk's holdings, they are close to 50%. Taxpayer support for SpaceX comes from direct government contracts worth billions.

According to USASpending.gov, the government database that tracks federal spending, SpaceX has signed contracts worth nearly $20 billion. The most critical contract came just before Christmas in 2008, when SpaceX and Musk were both virtually out of cash. That contract, worth $1.6 billion, involved flying 12 supply missions to the International Space Station. The deal allowed SpaceX to complete the Falcon 9 rocket, its main workhorse, and the Dragon capsule, said Casey Dreier, senior space policy advisory for the Planetary Society, a public interest group advocating for space flight. "They were right on the edge of insolvency," Dreier said. "Elon has pointed out at that moment they were on the edge, and that helped to save the company." Dreier said the ISS deal and other contracts have allowed NASA to transport U.S. astronauts without relying on Russia.

SpaceX has since received numerous additional contracts from NASA, the military, and other U.S. government agencies. It won a $3 billion contract to develop the next vehicle to carry astronauts to the moon. And Dreier said the company and other NASA contractors benefit from access to the agency’s employees and expertise. Ives said that if the Trump administration increases funding for NASA’s efforts to return to the moon and travel to Mars, SpaceX’s value could easily increase to $500 billion or more. "The $250 billion estimate is pretty conservative," he said.