{"id":197,"date":"2026-06-22T09:10:47","date_gmt":"2026-06-22T09:10:47","guid":{"rendered":"https:\/\/usabusinesschronicle.com\/?p=197"},"modified":"2026-06-22T09:10:47","modified_gmt":"2026-06-22T09:10:47","slug":"how-trump-screwed-rural-americans-to-help-musk-become-a-trillionaire","status":"publish","type":"post","link":"https:\/\/usabusinesschronicle.com\/?p=197","title":{"rendered":"How Trump Screwed Rural Americans to Help Musk Become a Trillionaire\u00a0"},"content":{"rendered":"<div>\n<p>In the run-up to SpaceX\u2019s historic initial public offering on June 12, commentators worried about who would get hurt. Their top concern was for everyday retirement savers: Major stock index providers like NASDAQ had changed their own rules to fast-track SpaceX\u2019s inclusion\u00a0in their market measures. These unusual moves would force holders of plain vanilla index funds to buy into a risky, unproven stock. Others fretted about impressionable retail investors who might sink money into Musk\u2019s grand vision only to get burned by marke\u200bt\u200b volatility.\u00a0<\/p>\n<p>Read more <a href=\"https:\/\/usabusinesschronicle.com\/?p=195\">Stopping Trump\u2019s Rolling Coup<\/a><\/p>\n<p>But these are speculative victims, losers only if SpaceX stock plummets. There\u2019s another group, however, that has <em>definitely<\/em> suffered real harm on the road to Musk\u2019s becoming a trillionaire: Americans in the nation\u2019s most rural communities. For decades, they have lived without the high-speed broadband service that the rest of us take for granted. This \u201cdigital divide\u201d was set to close thanks to a federal program created by President Joe Biden\u2019s administration. But at \u200b\u200bMusk\u2019s urging, Donald Trump\u2019s administration sabotaged the effort, changing the rules to funnel money toward Starlink, SpaceX\u2019s satellite internet subsidiary, while diverting billions of dollars from higher-quality competitors. This \u200bintervention\u200b helped shore up SpaceX\u2019s rickety balance sheet. It is also forcing slower, \u200b\u200b\u200bless reliable\u200b, and likely costlier broadband on rural Americans.\u00a0<\/p>\n<p>High-speed internet is an essential service for participating in modern life. Yet over\u00a040 million Americans live in small towns and rural communities that lack access to internet service at speeds required to pursue an education, hold down a job, or run a business. This inequity has endured despite nearly two decades of government subsidies. \u200b\u200bThat\u2019s because, as the <em>Washington Monthly<\/em> has reported in detail, these programs heeded the demands of the telecom lobby over the pleas of rural Americans: The government repeatedly funneled money to high-cost, low-quality telecom monopolies in exchange for meager upgrades. At the same time, Washington refused to fund true broadband entrants in areas these monopolies \u201cserved.\u201d\u00a0<\/p>\n<p>This \u200bcharade\u200b was supposed to \u200bend\u200b with the Broadband Equity, Access, and Deployment (BEAD) program, a signature priority of the Biden White House enacted in 2021. The $42 billion program would be the largest and\u00a0most comprehensive rural broadband effort to date, the first to connect every unserved location in the United States. Earlier federal efforts \u200b\u200b\u200blargely \u200bfunded cheap, quick-fix technologies that became obsolete after a few years. By contrast, BEAD prioritized connecting rural homes and businesses to fiber optic networks. This would be more costly up front but cheaper in the long term because fiber networks can be scaled inexpensively to provide ever-faster speeds.\u00a0<\/p>\n<p>Starlink,\u00a0already broadly available in rural America, does not match the speed or reliability of a wired connection\u2014especially when more than a few people use it in the same area. Were BEAD to succeed in wiring rural America with fiber, Starlink would lose current and future customers. In June 2024, as BEAD was being finalized after\u200b \u200b\u200bmuch delay caused by myriad telecom industry efforts to protect its interests, \u200bMusk used his megaphone on X, his social media platform, to call the program \u201can outrageous waste of taxpayer money,\u201d which \u201cshould be dissolved.\u201d\u00a0\u00a0<\/p>\n<p>With the help of a record $288 million in campaign spending by Musk, Trump won the 2024 presidential election. Days later, the president-elect put the tech mogul in charge of DOGE, the task force that would go on to decimate several federal agencies. But to political and industry insiders, it was already clear that Musk would win another prize. \u201cThe most important person for telecom policy \u2026 will be Elon Musk,\u201d said Blair Levin, the prominent telecom financial analyst, the day after Trump\u2019s victory. \u201cWhy would he want BEAD money to fund fiber deployments that would reduce his addressable market?\u201d\u00a0<\/p>\n<p>In June 2025, Trump\u2019s Commerce Secretary, Howard Lutnick, did the honors. Having \u201crevamp[ed]\u201d the program to rid it of \u201cwoke mandates, favoritism towards certain technologies, and burdensome regulations,\u201d Lutnick issued new rules for how states could spend their BEAD funds. The Biden Commerce Department had instructed states to select fiber providers for all locations where costs were not demonstrably prohibitive. Lutnick\u2019s new rules required states to award grants to the provider that promises to serve a given location at the lowest cost, provided it can meet a basic (and woefully inadequate, \u200bthanks to industry lobbying\u200b) speed threshold. Lutnick advertised his approach as \u201ctech-neutral,\u201d but it had the inevitable effect of pushing states towards low-Earth-orbit satellite providers like Starlink, which are the cheapest option for meeting the threshold. Indeed, as the<em> Financial Times<\/em> reported, Lutnick mentioned Musk by name in conversations with BEAD staff while pushing for the changes. \u201cHe asked if we had been talking to Elon,\u201d\u200b\u200b \u200bsaid Evan Feinman, who headed the BEAD effort until departing after Lutnick\u2019s announcement\u200b. \u201cThe clear thrust of his directive was to increase the amount of satellite being used regardless of any other considerations.\u201d (The Trump administration has disputed this account).\u00a0<\/p>\n<p>It\u2019s hard to overstate the depth of this betrayal of rural America\u2014a bloc that strongly supported Trump in the 2024 election. After years of government neglect, of kids doing homework in fast-food parking lots and businesses unable to keep up digitally with big-city competitors, BEAD was supposed to be <em>the<\/em> program that would bridge the digital divide once and for all. But now, as Christopher Ali, a broadband industry scholar at Penn State University, wrote, Lutnick\u2019s changes would cement \u201ca new digital divide as parts of the country go to satellite while others move to fiber optics.\u201d Feinman\u200b \u200bput it more bluntly: Trump was \u201cstranding all or part of rural America with worse internet so that we can make the world\u2019s richest man even richer.\u201d\u00a0<\/p>\n<p>How much richer, exactly? Musk has become the world\u2019s first trillionaire by selling investors on his dream of exploiting the vast commercial opportunities of outer space. That dream hinges on Starlink. Investors are counting on its strong profits to subsidize SpaceX\u2019s loss-making rocketry and AI divisions until those enterprises can deliver on moonshots like orbital data centers and asteroid mining. Without Starlink, there would be no SpaceX IPO\u2014certainly not at a $1.75 trillion valuation. As one Wall Street analyst told Reuters, \u201cStarlink is the only reason this valuation is defensible.\u201d\u00a0<\/p>\n<p>Read more <a href=\"https:\/\/usabusinesschronicle.com\/?p=193\">As Threat Level Reaches \u201cHighest It\u2019s Ever Been,\u201d Trump Sidelines Key Counterterror Program<\/a><\/p>\n<p>And for Starlink, Lutnick\u2019s hijacking of BEAD was a major coup. As of this writing, the company is set to receive $738.8 million in BEAD grants to cover 476,000 locations. That is\u00a0modest \u200bcompared with the\u200b $11.39 billion in revenue Starlink generated last year. It is also less than the billions of dollars watchdogs feared Starlink would receive following Lutnick\u2019s announcement\u2014many states fought back and preserved a good chunk of their allocations for fiber, while other Lutnick modifications reduced the number of locations eligible to be served by BEAD. But it is still a meaningful cash infusion for SpaceX, especially given that \u200b\u200b\u200bnearly all \u200bof it \u200bwill go \u200bstraight to the company\u2019s\u00a0bottom line. Unlike fiber providers, Starlink doesn\u2019t need to build any new infrastructure to serve new locations since its satellites are already in orbit. Customers need only install modest hardware in their homes. (Under BEAD rules, Starlink must pay for the installation of these receivers in locations subsidized through the program, although it has tried to wriggle out of even this minimal obligation.)\u00a0\u00a0<\/p>\n<p>This is another scandalous aspect of the Trump administration\u2019s push to divert funds to Starlink. \u201cIt\u2019s free money,\u201d Sascha Meinrath, the Palmer Chair in Telecommunications at Penn State University, told me. \u201cWe are subsidizing their already existing, but inadequate, infrastructure. It begs the question, \u2018What exactly are we purchasing with these taxpayer dollars?\u2019\u201d \u200b\u200b\u200b\u200b\u00a0<\/p>\n<p>More important to SpaceX than the one-time grant money is the recurring revenue Starlink can extract from the 476,000 new locations it will serve through BEAD. These customers are particularly valuable, given that markets will closely scrutinize Starlink\u2019s average revenue per user\u2014a figure that has declined as the company increasingly relies on less affluent foreign customers for growth. The new BEAD customers will expand Starlink\u2019s U.S. base by about 24 percent.\u00a0<\/p>\n<p>The BEAD customers are also extra valuable because they are in unserved rural areas. That means they have nowhere else to turn if Starlink raises prices. This had already begun in the run-up to the IPO. Under the Trump-era BEAD, thousands of Americans could find themselves in the position of Julie Slama, a small-town Nebraska lawyer forced to swallow a 44 percent rate hike on a plan providing suboptimal service. \u201cFiber would be a more stable alternative,\u201d Slama told the <em>Washington<\/em> <em>Post<\/em>. \u201cI would switch to fiber tomorrow if it was offered.\u201d \u00a0<\/p>\n<p>This last bit is key. Ultimately, Trump\u2019s biggest gift to SpaceX is not what the new BEAD has done for Starlink, but rather what it has <em>not<\/em> done for fiber providers\u200b\u200b\u200b\u200b. Had the BEAD program followed the course it was on when Trump took office, Starlink would \u200bstill be\u200b a niche provider of service to ultra-remote locations. But now, \u201ctens if not hundreds of thousands of homes that otherwise would have fiber line connectivity, which is both faster, more reliable, and cheaper than Starlink, will not have that option,\u201d Meinrath said. Indeed, only $21 billion of the $42 billion allocated for BEAD grants has been deployed due to the smaller fiber footprint pushed by the Trump administration. That leaves a much bigger role for Starlink\u2014both through the locations it will now serve through the program and those it may grow to serve in the future.\u00a0\u00a0<\/p>\n<p>\u200b\u200bThe new BEAD program is \u201cworth quite a bit in terms of potentially cementing SpaceX\u2019s relationships in Washington,\u201d Meinrath added. \u201cIt\u2019s going to be providing a vital service.\u200b\u200b\u200b\u200b\u201d\u200b \u200b\u200b\u00a0<\/p>\n<p>\u200b\u200bUnfortunately for rural America, that service won\u2019t meet the demands of the modern economy\u2014a fact Musk\u2019s own business decisions make clear. \u200b\u201cMusk, when Tesla opens up a facility, doesn\u2019t put it on Starlink,\u201d Feinman \u200btold\u200b the \u200b\u200b<em>Financial Times<\/em>\u200b\u200b. \u201cHe gets fiber.\u201d\u200b\u200b\u00a0<\/p>\n<p>Read more <a href=\"https:\/\/usabusinesschronicle.com\/?p=191\">How to Contain the Oligarchs<\/a><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Trump\u2019s rewrite of rural broadband rules helped Musk steer public money toward Starlink to strengthen SpaceX and screw rural Americans.<\/p>\n","protected":false},"author":1,"featured_media":196,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6,17,5,2,3],"tags":[78],"class_list":["post-197","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-foreign-policy","category-government","category-podcast","category-politics","category-the-monopolized-economy","tag-tagged-biden-broadband-plan-broadband-access-inequality-donald-trump-elon-musk-joe-biden-spacex-starlink"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - 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