In a seismic shift for U.S. politics, tech mogul Elon Musk announced the formation of the “America Party” on Saturday (5th July) directly challenging his former ally, President Donald Trump.
The move follows weeks of acrimony over Trump’s controversial $3.3 trillion tax and spending bill, which Musk decries as “debt slavery” that will “bankrupt the country”.
The breaking point
Musk declared the party’s creation on his social media platform X, stating: “By a factor of 2 to 1, you want a new political party and you shall have it! When it comes to bankrupting our country with waste & graft, we live in a one-party system, not a democracy. Today, the America Party is formed to give you back your freedom”.
This followed a 24-hour poll on X where approximately 60% of over 1.2 million respondents supported a new party.
The catalyst was Trump’s signing of the “One Big Beautiful Bill Act” on 4th July, which Musk lambasted as “insane spending” that would increase the deficit from “an already insane $2T under Biden to $2.5T” and “bankrupt the country”.
By a factor of 2 to 1, you want a new political party and you shall have it!
When it comes to bankrupting our country with waste & graft, we live in a one-party system, not a democracy.
Today, the America Party is formed to give you back your freedom. https://t.co/9K8AD04QQN
— Elon Musk (@elonmusk) July 5, 2025
From “first buddy” to foe
The rupture marks a stunning reversal for the once-close allies. Musk was Trump’s largest individual donor in the 2024 cycle, contributing over $280 million to his reelection effort.
Post-election, Musk chaired Trump’s “Department of Government Efficiency” (DOGE), tasked with slashing federal waste. Their relationship began unravelling in May when Musk resigned from DOGE and publicly attacked Trump’s fiscal approach.
Trump retaliated by threatening to review billions in federal subsidies supporting Musk’s companies—including Tesla, SpaceX, and Starlink—and quipped that DOGE might “go back and eat Elon”.
The America Party’s strategy
Rather than mounting a nationwide challenge, Musk’s party plans to wield influence by targeting pivotal congressional races.
He revealed the America Party would “laser-focus on just 2 or 3 Senate seats and 8 to 10 House districts,” aiming to secure enough leverage to become “the deciding vote on contentious laws”.
Musk framed this targeted strategy using a military analogy, citing ancient Greek general Epaminondas’ tactics to “shatter the myth of Spartan invincibility” by applying “extremely concentrated force at a precise location”.
Obstacles ahead for Elon Musk
Despite Musk’s vast wealth estimated at over $350 billion the America Party faces formidable challenges:
• Legal Hurdles: U.S. political parties are state-regulated entities, requiring complex navigation of 50 distinct sets of ballot-access rules. For example, California demands either 75,000 registered party members or 1.1 million petition signatures for ballot qualification .
• Historical Precedent: Third parties have consistently struggled against the Democratic-Republican duopoly. Ross Perot won 19% of the popular vote in 1992 but secured no Electoral College votes, while the Libertarian and Green parties remain marginal after decades of effort.
• Funding Constraints: Once recognized as a national party, donor contributions would be capped at $10,000 annually to state parties and $44,300 to national committees, limiting Musk’s ability to bankroll operations personally.
Market and political fallout
The feud has already rattled investors. Tesla’s stock plummeted from a December high of $488 to $315 by July, partly attributed to the Musk-Trump rift. Republicans fear Musk’s defection could splinter conservative support during the 2026 midterms, endangering their narrow congressional majorities. Trump, meanwhile, has dismissed Musk’s critiques as resentment over the bill’s phaseout of electric vehicle tax credits a move potentially costing Tesla billions .
As of 6th July, the Federal Election Commission shows no registration for the America Party. Nevertheless, Musk’s declaration signals an unprecedented attempt to disrupt America’s two-party system, turning a personal feud into a high-stakes experiment in fiscal populism. With both men commanding global influence, their clash may redefine U.S. politics long before the party’s planned midterm debut.
Analysis: Can Musk crack the duopoly
While Musk’s wealth and influence make him a formidable disrupter, breaking the 160-year Republican-Democrat lock will require unprecedented mobilisation. His targeted-district strategy acknowledges third-party limitations but aims for kingmaker status in a divided Congress. With Trump’s approval still above 40%, the America Party’s test will be converting online polls into ballot-box wins.
