Upon Entering Government Ranks, Elon Musk's Financial Assets Might Be Subject to Public Disclosure
President-elect Trump's administration declared on Tuesday night that Elon Musk and Vivek Ramaswamy will jointly lead a new Department of Government Efficiency. Their tasks include dismantling government bureaucracy, reducing excessive regulations, cutting down on unnecessary expenditures, and restructuring federal agencies. These responsibilities seem quite substantial, considering that neither individual was selected through an electoral process. Furthermore, appointing Musk, whose fortune is heavily reliant on government contracts and federal assistance, to a role influencing spending raises some eyebrows.
Gizmodo spoke with Jordan Libowitz, vice president of communications at the nonpartisan nonprofit Citizens for Responsibility and Ethics in Washington, about the ethical obligations Musk and Ramaswamy might have in their new roles.
Gizmodo: This new Department of Government Efficiency remains vague to us. Based on Trump's announcement, is it conceivable that Musk or Ramaswamy will require Congressional approval to lead it?
Jordan Libowitz: It's unclear what this new body truly is, as they use the term 'department,' though it is unlikely to actually be one. Departments are established by Congress, but no such legislation has been passed for a new department. Therefore, it seems unlikely to undergo a Senate confirmation process.
The nature of the role truly affects the ethical responsibilities Musk and Ramaswamy would be bound to in terms of conflict of interest laws and so forth. We are unsure where it fits into the government, but it appears to be a presidential appointment akin to a blue-ribbon commission or study group, rather than a full-fledged department like the Department of Homeland Security.
Gizmodo: If it is essentially an advisory body, what kind of financial and conflict of interest disclosures might Musk be obligated to submit?
Libowitz: If they are deemed 'special government employees,' Musk will be subject to conflict of interest laws. His obligations will depend on his interactions with government employees, whether he directs them, speaks on behalf of Trump's administration, or outlines his duties.
If they are classified as special government employees, Musk will be required to file financial disclosures under section 208, the Criminal Conflict of Interest Statute. If there are concerns under section 208, the options are either recusal or divestiture. Musk could opt to abstain from any matters concerning social media companies, space, automotive industries, or anything else he has assets tied to, or he could sell those assets before beginning his role.
If they are not special government employees, the question of whether this falls under the Federal Advisory Committee Act comes into play. If this is considered an advisory committee, they must be transparent. If not, they may fall under the ambit of lobbying regulations and have to disclose lobbying activities.
Gizmodo: What happens if Musk and Ramaswamy are not deemed special government employees or don't fall under the Federal Advisory Committee Act? Does this imply they will hold little power or influence over the government's operations?
Libowitz: Influence can sometimes be subtle or pervasive. The three Mar-a-Lago members who offered advice to departments during the previous administration had an impact despite lacking formal roles. Anyone with close ties to the President can potentially wield influence.
However, the more concrete actions are taken, the more they may be classified as lobbying. The more power they possess, the more likely they are to be subject to lobbying regulations.
Gizmodo: If Musk is required to file a financial disclosure, what might we gather from it?
Libowitz: The disclosure would reveal assets and debts, broken down by categories and typically within specific ranges. For Musk, most assets will likely fall under the $50 million range or higher. We could also learn where he has money invested in addition to his major ventures, such as X, Tesla, and SpaceX.
The filing would also provide a clearer picture of the value of Twitter, as well as Musk's ownership stake and debt levels. Additionally, it will give a more transparent insight into Mon's investments outside his major ventures.
Gizmodo: Do you think you can speculate on how this will unfold and which ethical rules Musk may have to adhere to?
It's quite challenging to make predictions with certainty, but there will likely be some level of scrutiny on Musk's actions and financial interests. Depending on his role and the nature of his dealings, he may be subject to various conflict of interest laws and disclosure requirements. It will be crucial for Musk and Ramaswamy, as well as Trump's administration, to approach their involvement with transparency and accountability to avoid any misgivings or public backlash.
Libowitz: I'm clueless about this one. It could range from them operating in secret, like a hidden administration, to simply being pushed into a corner with limited influence. We're lacking crucial information to accurately identify what's happening here. Time will be our guide in determining the extent of their influence.
Government shifts are gradual. You can only accomplish so much reform in two years, and a lot of changes need approval from Congress. As you know, Congress isn't known for its swiftness.
However, where potential issues could surface is within the contractor relationship between NASA, the Department of Defense, and SpaceX. This is where a potential conflict of interest may be most prevalent.
In the context of their new roles, Musk and Ramaswamy might discuss the potential integration of technology into government efficiency, highlighting the future implications of advanced technology on government operations. Moreover, given Musk's reliance on government contracts and federal assistance, the pair might need to address any perceived conflicts of interest, ensuring transparency and adherence to ethical guidelines in their decision-making.
