New York Times Probes Musk Holdings & Political Activities In Texas

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This week, a team of reporters for the New York Times consisting of Kirsten Grind, Melanie Bencosme, James Surdam, and Sean Havey, published a report about Elon Musk’s growing private empire in Texas.

He is the wealthiest person in human history, so it’s not surprising that he may be doing things mere mortals might not. Still, the extent of his activities is worth reviewing, if only to better understand what enormous wealth can do in the US today where cash is king and the rich work tirelessly to shield the extent of their fortunes — and their political activities — from public scrutiny.

Here is the video. We will discuss its implications after you have had a chance to view it. [We’re not sure why the Times decided to create the video in cell phone format, but who are we to question the Grey Lady?]

Goodbye, California; Hello, Texas

In 2020, Elon Musk announced he was moving to Texas from California and embarking on a personal austerity campaign to strip his life of belongings. “I am selling almost all physical possessions,” he posted on social media. “Will own no house.” It sounded like an almost biblical vow of poverty. “Imagine no possessions. I wonder if you can. No need for greed or hunger. A brotherhood of man. Imagine all the people sharing all the world….”

It turns out Musk was not a disciple of John Lennon. When he said he would own no house, he only meant one in his own name. Since moving to Texas, the Times determined he has “quietly built an empire of more than 90 companies and other legal entities in Texas, which have amassed a vast collection of assets.”

An Obsession With Privacy

Rich people are obsessed with privacy, and Musk is no exception. His secretive network shows how he has made Texas central to his operations and ambitions. More than 50 of his 90 or more companies there are subsidiaries or other entities affiliated with his business empire, such as the rocket company SpaceX and the electric vehicle maker Tesla, as well as his nonprofit Musk Foundation. “The lines between Mr. Musk’s business and personal interests are often blurry, and some of the companies most likely served both purposes,” the Times reports.

His real estate holdings in Texas are now larger then Central Park, but the real story is not multi-million-dollar condos with sweeping views of downtown Austin. It is how he uses this amalgamation of wealth to support MAGA and the Moron of Mar-A-Loco. “Tapping these companies to cover the expenses of a super PAC is highly unusual, campaign finance experts said, and ended up obscuring how money was being spent because they are not subject to the disclosure requirements of super PACs,” according to the Times.

“The vehicle that Musk frequently turned to is one that many of the ultra-rich use — limited liability companies designed to shield owners from legal and financial risks, as well as public scrutiny. Whatever Musk’s intent, the effect of using these companies has been to disguise how he is spending his money.”

The Times was able to identify the purpose of many of the roughly 37 companies that appeared to be for Elon Musk’s personal use. The companies the Times discovered may represent just a small fraction of his overall empire. He also has ties to limited liability companies outside Texas in states like California, Delaware, and Nevada.

“The ultra-wealthy’s use of limited liability companies is legal and often used to ensure privacy. But they are now used so frequently and for so many investments that some billionaires cannot keep track of how many they operate,” said Mitchell Gans, a law professor at Hofstra University.

Using Associates To Hide His Activities

Mr. Musk’s use of limited liability companies to accumulate the land suggests that he and his inner circle took steps to keep the purchases secret. Many of those companies are associated with Jared Birchall, Musk’s longtime personal money manager, who also handles his personal affairs. Some of the 12 companies are linked to Musk’s higher-profile businesses, or are attached to his lieutenants or friends rather than himself.

The largest tract of land owned by one of Musk’s limited liability companies is about 530 acres just outside Austin and across from a Tesla factory. The company that owns that land, Horse Ranch LLC, was formed in 2021, and its incorporation documents name Birchall as its manager. Most of the land is vacant, but a Times reporter recently saw construction crews on the site.

In Texas, Musk appears to have taken steps to disguise his activity. At least four limited liability companies with no trace of Musk are tied to properties that he has lived in or used. Starting in 2022, Musk used limited liability companies with generic names to buy three houses totaling about 31,000 square feet for mothers of his children. (He has at least 14 children, including at least four with Ms. Zilis).

One company was Stratford House LLC, which owns a property valued at about $6 million in the wealthy enclave of West Lake Hills. Musk lived in that house with Claire Boucher, the singer known as Grimes, and their children.

Promoting MAGA

The Times found that Musk used several Texas entities to support Mr. Trump’s 2024 campaign. That year, he created two companies, United States of America Inc. and Group America LLC. He also tapped Europa 100 LLC, one of his oldest limited liability companies that he once used to pay his nannies, and his family office, Excession.

The four companies provided almost $80 million in services to Musk’s America PAC, a political action committee devoted to re-electing Mr. Trump. The companies, rather than the political action committee, took on the job of paying expenses, which campaign finance experts said was highly unusual.

For example, United States of America Inc. issued $47 checks to voters who signed a petition pledging their support for the First and Second Amendments, according to its website — a controversial effort by Musk to help mobilize Trump voters. It also paid for political consulting, travel, and food.

Brendan Fischer, a director at Campaign Legal Center, a nonprofit focused on US elections, examined the transactions for The Times and reported that Musk was able to mask where the money was going by using private companies to cover America PAC’s expenses.

While political action committees are required to publicly disclose each individual payment, expenses that are covered by private companies are not subject to the same rules. Thank you, John Roberts and the other “originalist” judges of the US Supreme Court for smashing all campaign fund barriers without including any safeguards to prevent fraud and abuse.

The practice is legal but “undermines the spirit of the law,” which favors transparency, Mr. Fischer said, adding that it “had the effect of disguising where tens of millions of dollars ultimately went.”

Europa 100 also paid America PAC’s treasurer, Chris Young, a salary as high as $1 million, according to a campaign finance filing, though it was unclear what work Young did for the company. The Times says Musk used several Texas entities to support Tramp’s 2024 presidential campaign, including Europa 100 LLC, Excession LLC, Group America LLC, and United States Of America Inc.

Other companies were associated with Musk’s travel and security. Falcon Landing LLC, a SpaceX subsidiary, owns two planes that he sometimes uses for private travel, according to corporate documents and people familiar with the planes. One plane, a Gulfstream, was appraised at about $15 million last year, Travis County records show, though its resale value is much higher. Does Travis County not know how to value personal property or is it just another captive stooge in Musk’s vast empire?

Put them together and what have you got? Not bippity boppity boo, but a pattern of concealment deliberately orchestrated to build a wall of secrecy around Musk and his dealings — especially when it comes to funding dictators and anti-democracy crackpots.

Social License

Every LLC and corporation is a creature of the state where it is created and every state has a vested interest in exposing nefarious activities that strike at the foundation of its government. It’s a concept known as “social license to operate,” and while it may be considered an anachronism today, it is a bedrock component of every legal scheme that seeks to shield people and businesses from public scrutiny.

Look at it this way: Should Mexican drug cartels or organized crime be allowed to set up corporate structures that allow them to shield their activities? The answer for most would be, “Of course not.” But extend that analogy just slightly and ask why those who plot the overthrow to the US government enjoy such legal protections?

Charles Koch has made it his life’s work to create a shadowy network of organizations to promote his loathing of the federal government, among them the Heritage Society, the Federalist Society, and a host of others. Jeffrey Epstein is another ultra-wealthy person who hid much of his pedophilia and government interference behind a web of secretive organizations.

If I were worth a couple billion dollars, I wouldn’t want the paparazzi hanging around, taking my photo hundreds of times a day. Fortunately, my lowly position as a simple scribe has eliminated that worry. “Democracy dies in darkness” used to be the byline of the Washington Post until another super wealthy person, Jeff Bezos, decided to suck up to a tyrant rather than report the news.

When we permit ultra-wealthy people to construct a cone of silence around their activities, we undermine the foundations of our civil society. We need to stop doing that.