Musk role in a Trump presidency raises conflict-of-interest questions

Musk has agreed to lead a government efficiency commission if Trump is re-elected president, Trump said in a speech on Thursday. “If he has the time," Trump added, Musk would be a good choice.

The alliance shows that Musk, one of the world’s richest people and head of several businesses, not only is interested in getting Trump elected, but also wants to actively participate in influencing federal policy.

The commission would conduct an audit of the entire federal government and make recommendations for drastic reform, Trump said. That would give Musk influence over the same agencies that regulate his multibillion-dollar portfolio of companies, including the electric-vehicle maker Tesla and the rocket company SpaceX.

On Thursday, Musk said on X that he would “look forward to serving America if the opportunity arises. No pay, no title, no recognition is needed."

Trump and Musk have grown closer in recent months. Musk officially endorsed Trump on July 13 after the former president survived an assassination attempt at a campaign rally.

The Wall Street Journal earlier this year reported that Musk and Trump had discussed a possible advisory role for Musk in a Trump administration, which Musk later denied.

In July, the Journal reported Musk had told people he planned to contribute around $45 million a month to the Trump-supporting America PAC. Musk later said on X that he is donating at a “much lower level."

Last month, Musk interviewed Trump in a conversation streamed on X, during which Trump embraced the billionaire entrepreneur’s suggestion to form a commission tackling government spending as a way to address inflation.

“You’re the greatest cutter," Trump told Musk, referencing layoffs at his companies. “I mean, I look at what you do."

The announcement marks a deepening of Musk’s foray into politics, from endorsing and advocating for Trump to engaging in policy. Musk previously served on presidential advisory groups during Trump’s first term but quit them in 2017 after disagreeing with Trump’s decision to pull the U.S. out of the Paris climate agreement. Despite occasional donations to both political parties over the years, Musk rarely weighed in on politics, until recent years.

Musk wouldn’t be the first business executive to get involved in the U.S. government, and it isn’t unusual for business leaders to join advisory groups. How exactly Musk would handle running his empire while also leading a government efficiency commission is unclear.

Some Tesla investors have argued that Musk is already spread too thin and has spent too much time working at the social-media site X and the artificial-intelligence startup xAI while Tesla is struggling to grow.

As for conflicts, “Musk’s business interests are so broad and so intermingled with the federal government," said Kathleen Clark, a law professor at Washington University in St. Louis who specializes in government ethics, “it’s hard to imagine guardrails that could address his conflicts."

Musk’s companies are regulated by several federal agencies. In some cases, such as with Tesla and the Securities and Exchange Commission, the relationship is contentious.

Tesla’s vehicle sales and its energy business also have benefited from federal tax credits and grants issued by various government departments.

SpaceX’s most important customers include the National Aeronautics and Space Administration, which relies on the rocket company to transport astronauts to the International Space Station, and the Pentagon, which uses SpaceX to launch national-security satellites.

Musk’s social-media platform X is regulated by the Federal Trade Commission, and his brain-implant startup Neuralink is regulated by the Food and Drug Administration.

A lot depends on the details of any setup, said Richard Briffault, a professor at Columbia Law School who focuses on government ethics. “If he’s going to be proposing guidelines that direct government contracting in favor of his own companies, that’s a real problem," he said.

“If it’s a more general set of principles that are designed to improve government efficiency or streamline the contracting and grant-making process, it’s hard to object to that."

Write to Alexa Corse at alexa.corse@wsj.com and Becky Peterson at becky.peterson@wsj.com