You’d think being the President’s right-hand man and the "First Buddy" of the new administration would mean you’re on the same page about big tech wins. Not for Elon Musk. Honestly, the ink was barely dry on President Donald Trump’s massive January 2025 announcement before Musk decided to basically set the whole thing on fire.
The announcement was huge. Massive. We’re talking about "Stargate," a joint venture between OpenAI, Oracle, and SoftBank. The goal? A $500 billion investment to build colossal data centers across the United States. Trump, flanked by Sam Altman and Masayoshi Son in the White House, called it the largest AI infrastructure project in history. He promised 100,000 jobs. He promised "energy emergency" declarations to bypass red tape.
💡 You might also like: Building and Land Technology: What the Industry Isn't Telling You About Efficiency
Then came the tweet.
Musk didn't just disagree; he went for the jugular. "They don't actually have the money," he posted on X. He claimed SoftBank had "well under $10B" secured and basically labeled the $500 billion figure a total fantasy.
The Stargate Project: What Trump Actually Promised
To understand why Musk is so heated, you’ve got to look at what was actually on the table. Stargate isn’t just a fancy name. It’s a literal attempt to build the "physical and virtual infrastructure" for the next century. Larry Ellison from Oracle was there too, talking about ten data centers already under construction in Abilene, Texas.
They want to build 20 of these things. Each one is about half a million square feet.
The idea is to keep AI "Made in the USA" so China doesn't win the race to AGI (Artificial General Intelligence). Trump’s plan involves using executive orders to bulldoze through environmental reviews and power grid bottlenecks. If you’re a tech company needing a few gigawatts of power, Trump basically said, "I’ll make it happen."
But there’s a catch.
📖 Related: Emojis for Macbook Pro: What Most People Get Wrong
The government isn't paying for this. It's all private sector money. And that’s exactly where Musk’s skepticism—or perhaps his competitive streak—kicks in. He told the world that the numbers were cooked. He even posted an image of a crack pipe, implying that the OpenAI team was high on their own supply when they came up with the $500 billion valuation.
Why Musk is Tearing It Down
Is this about the money, or is it personal? Probably both.
Musk and Sam Altman have a history that's messier than a soap opera. Musk co-founded OpenAI, left in a huff, and is now suing them (again) for allegedly abandoning their non-profit mission. Now, Altman is standing next to Musk's favorite president, getting the "blessing" for a project that would give OpenAI a massive advantage over Musk’s own xAI.
It’s kinda awkward. Musk is supposed to be leading the Department of Government Efficiency (DOGE). His whole job is to cut waste and check receipts. So, when he sees a $500 billion "commitment" from a rival, he uses his official-ish platform to call it a bluff.
- The Funding Gap: Musk says SoftBank doesn't have the cash.
- The Power Problem: Experts like Ethan Mollick have questioned if the grid can even handle this much load, even with "emergency declarations."
- The Rivalry: xAI is building its own "Colossus" supercomputer in Memphis. Musk doesn't want the government giving special treatment to the Stargate crew.
Trump, for his part, didn't seem too bothered at first. When reporters asked if Musk's "take down" of the announcement annoyed him, he just shrugged it off. "He hates one of the people in the deal," Trump said. "I have certain hatreds of people, too."
The Reality of the $500 Billion Number
So, who’s right? If you look at the SEC filings and the venture capital climate in 2026, the truth is somewhere in the middle.
OpenAI and SoftBank reportedly committed about $19 billion each to start. Oracle and MGX (the Abu Dhabi fund) put in another $7 billion each. That gets you to roughly $52 billion—a far cry from $500 billion. The rest is supposed to come from debt, limited partners, and future rounds over the next four years.
Musk’s "take down" wasn't technically wrong about the liquid cash available today. But in Silicon Valley, "investing $500 billion" usually means "we plan to spend this much over a decade if the bank lets us."
What This Means for the Future of AI
This isn't just a billionaire spat. It’s a war over the future of American energy and compute. If Stargate actually happens, it will rewire the American landscape. We’re talking about massive power plants built specifically for AI.
Trump’s Executive Order 14179, signed right after the inauguration, already started stripping away Biden-era AI guardrails. The goal is "offensive" growth. But if the world's richest man and the President's top adviser is calling the flagship project a scam, it makes investors nervous.
The drama has actually created a weird split in the "MAGA" tech world. You have the "accelerators" who want Stargate at any cost, and the "DOGE" crowd who thinks these mega-projects are just corporate welfare in disguise.
Actionable Takeaways for Following the AI Race
If you're trying to figure out where the actual progress is happening amidst all the noise, keep an eye on these specific markers over the next few months:
- Watch the Power Permits: Don't look at the $500 billion number. Look at the Department of Energy. If they actually start issuing "emergency" permits for nuclear or natural gas plants in Texas and Ohio, the project is real.
- Follow the H-1B Policy: A big part of the Stargate plan involves talent. If the administration tightens visas (as Bannon wants) vs. loosening them for tech (as Musk sometimes suggests), it will tell you who is winning the internal power struggle.
- Check xAI’s Expansion: Watch how fast Musk grows his own data centers. If he suddenly announces a "Colossus 2" that rivals Stargate, his criticism was likely a tactical move to buy time for his own projects.
- Monitor the Lawsuits: The Musk vs. OpenAI trial is scheduled to heat up in 2026. Discovery could reveal if OpenAI actually has the "good authority" funding Musk claims is missing.
The "take down" wasn't a one-day event; it’s the start of a multi-year friction between two of the most powerful men in the world. Whether Stargate becomes a monument to American innovation or a $500 billion ghost town depends entirely on whose version of "the truth" sticks.