Elon Musk casts doubt on Stargate - Donald Trump’s US$100 billion AI announcement

President Donald Trump (left) is joined by, Masayoshi Son, chief executive of SoftBank, and Sam Altman, chief executive of OpenAI, at an event touting a US $100 billion venture in AI infrastructure, at the White House in Washington. Photo / The New York Times

The new President had claimed the AI announcement as an early trophy, taking credit for the companies’ decision to spend up to US$500 billion building data centres.

Elon Musk is casting doubt on the first major tech investment announcement made by President Donald Trump, openly questioning the administration he now serves.

On Tuesday, Trump announced a joint venture among OpenAI, SoftBank and Oracle to create at least US$100 billion in computing infrastructure to power artificial intelligence, some of which is already under way.

But in two late-night messages on his social platform X, Musk said the venture, dubbed Stargate, did not have the financing to achieve the promised investment levels.

“They don’t have the money,” Musk wrote in reply to an OpenAI post on the announcement. “SoftBank has well under US$10b secured. I have that on good authority.”

The dismissal by Musk, who is one of Trump’s closest advisers and will head up an agency created to slash the nation’s budget, is one of his first public breaks with the administration. It’s also an unusual move for any senior policy official to question an initiative trumpeted by the president.

Trump claimed the AI announcement as an early trophy, taking credit for the companies’ decision to spend up to US$500b building data centres, which are huge buildings full of servers that provide computing power. Trump promised to clear regulatory hurdles for the development of AI and to make the United States a global leader in the technology, beating out China.

Stargate already has US$100b in hand, two people familiar with the venture said. SoftBank, OpenAI, Oracle and MGX, an investment group in the United Arab Emirates that focuses on AI, provided the financing.

(The New York Times has sued OpenAI and its partner, Microsoft, claiming copyright infringement of news content related to AI systems. The two companies have denied the suit’s claims.)

Musk has been battling with OpenAI’s chief executive, Sam Altman. Musk, who helped found the company, has sued OpenAI and Altman for antitrust violations.

Musk formed a rival called xAI in 2023, well after a boom in the technology that included the debut of OpenAI’s ChatGPT. The start-up recently raised US$6b in funding.

Altman took to X on Wednesday morning to refute Musk’s assertions.

“Wrong, as you surely know,” Altman wrote. “Want to come visit the first site already under way?”

Musk and Trump have grown close over the past few months after the tech mogul came out in support of the president’s campaign, eventually donating more than US$250 million to back his run. Musk, the world’s richest man according to the Bloomberg Billionaires Index, became a vocal supporter, using his megaphone on X to stump for Trump.

Musk also is the chief executive of Tesla and rocket company SpaceX.

“Elon Musk is a walking conflict of interest,” said Craig Holman, government affairs lobbyist for non-profit consumer advocacy organisation Public Citizen. “People throughout history have tried to influence government, but what makes him so unique is his close friendship with Donald Trump, along with the breadth of his businesses that are affected by government contracts, tax and other public policies.”

Musk did not immediately respond to a request for comment.

During the presidential transition, Musk planted himself in a cottage at Trump’s Mar-a-Lago resort in Florida with easy access to planning meetings. He’s been omnipresent by Trump’s side, bringing Trump to a SpaceX rocket launch, attending Trump’s New Year’s Eve party and sitting with other tech moguls at the inauguration Monday.

On Wednesday, Musk reposted commentary from a tech investor that repeated claims that the Stargate initiative didn’t have enough funding. The post by Gavin Baker, managing partner and chief investment officer at Atreides Management, said that “Stargate is a great name but the US$500b is a ridiculous number and no one should take it seriously,” unless Softbank was willing to sell off certain assets.

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