Zohran Mamdani's proposal for when Elon Musk becomes the first billionaire says: '1 Trillion Reasons Why...'

New York City Mayor Zohran Mamdani used Elon Musk’s latest financial milestone to renew his call for higher taxes on wealthy individuals. In response to Musk becoming the world’s first billionaire, Mamdani posted on X: “Reason #1,000,000,000,000 why we should tax the rich.”

Musk’s wealth soared after SpaceX made its stock market debut on Friday. The company’s stock opened at $150 apiece, above its IPO price of $135, significantly increasing the value of Musk’s holdings.

The jump in SpaceX stock pushed Musk’s net worth past the $1 trillion mark and increased his lead as the world’s richest person.

Quick answers to key questions

•5 QUESTIONS

Elon Musk’s fortune, now over $1 trillion, has fueled discussions about higher taxes for the wealthy, as New York City Mayor Zohran Mamdani has emphasized, advocating taxing wealthy individuals to achieve greater economic fairness.

Musk achieved billionaire status mainly due to SpaceX’s successful IPO, along with his significant holdings in Tesla, which combined significantly boosted his net worth.

Mamdani’s statement on taxing the wealthy reflects a broader policy goal to address income inequality and fund public services, using Musk’s financial milestone as a focal point.

Investing in SpaceX offers immediate access through its recent IPO, while Tesla has already proven to be one of the best-performing stocks and provides historical context for potential investors.

Yes, experts advise caution with new IPOs like SpaceX as they can be volatile and may not be profitable immediately, suggesting diversification through mutual funds or ETFs as a safer alternative.

Mamdani’s comments reflect the platform on which he campaigned. The progressive mayor has consistently supported higher taxes for wealthy residents. His administration’s new tax on expensive second homes has already drawn criticism from some wealthy property owners in the city.

Long-standing tensions with Musk

Musk has previously criticized Mamdani and endorsed Andrew Cuomo during last year’s New York mayoral race.

Despite their political differences, Mamdani said he and Musk share a common interest in improving efficiency and reducing waste in government.

Last month, Mamdani announced the creation of the Government Efficiency Commission, a program designed to make the city run more efficiently.

The initiative has been compared to the Musk-led DOGE office set up in the White House.

How Elon Musk Made His Fortune

Elon Musk’s journey to becoming the world’s first billionaire began with the sale of two early businesses, Zip2 and PayPal, which netted him roughly $200 million. He used that money to launch SpaceX and invest in Tesla, defying the odds by creating a space company that figured out how to reuse rockets and a car company that made electric vehicles cool.

Read also | 5 powerful money lessons I learned from the world’s first billionaire, Elon Musk

A large portion of Musk’s wealth exists in the form of stock holdings and performance-based stock awards. Many of these shares have not been sold, while some will only be acquired if Tesla and SpaceX meet challenging business goals.

His latest compensation package for Tesla was so significant that it drew criticism from the Vatican.

The rise in Tesla stock is rewarding investors

Musk has often faced criticism for clashing with regulators, splitting his time between several companies and, more recently, taking on a role in the Trump administration. However, Tesla’s rising share price has largely overshadowed those concerns.

Read also | Quote of the day from Elon Musk: “Whoever said money can’t really buy happiness…”

Since its stock market debut in 2010, Tesla has returned around 20,000%, creating more than $1.2 trillion in wealth for investors.

SpaceX IPO could reshape market indices

SpaceX is the first of three major companies expected to go public this year, with AI companies Anthropic and OpenAI also expected to follow.

In a move that could spur investor demand, Nasdaq adjusted its rules to allow SpaceX to add to index funds within 15 days of its listing, meaning many investors could end up buying shares earlier than usual.

Read also | Why can’t Elon Musk do for politics what he did for industry?

Not everyone welcomes SpaceX’s arrival on the public markets.

Representatives of pension funds covering firefighters, teachers and other public sector workers in California and New York sent SpaceX a letter last month expressing concern about parts of the company’s IPO structure.

Among the questions raised were mandatory arbitration requirements for shareholder disputes and the level of control Musk will retain over the company after it goes public.

(With input from the AP news agency)