A Double Agent or Diplomat? How Elon Musk Can Broker U.S.–China Cooperation on Artificial Intelligence

Emily von Zedtwitz, The University of California – Santa Barbara

---

Abstract

Can Elon Musk serve as a “diplomat” in advancing U.S.–China cooperation on AI governance, or is such a role fundamentally compromised by his commercial entanglements? This paper makes a case for both scenarios before ultimately arguing that Musk may, paradoxically, embody each case. His vast financial and operational exposure in both nations render him a perpetual conflict of interest; yet this exact tension might uniquely situate him to facilitate dialogue between two superpowers vying for AI supremacy. Musk’s economic interdependence with both nations means his own prosperity hinges on their mutual stability, giving him a vested interest in narrowing U.S.–China technological rivalry. With stakes escalating as AI progresses, Musk may be the most viable actor presently capable of advancing pragmatic cross-border governance on AI. 

1. Introduction

The rise of advanced artificial intelligence (AI) has unfolded with a velocity that makes climate change, long considered the global crisis of our time, almost feel slow and predictable by comparison. AI capabilities are man-made technologies driven by profit incentives, and accelerate at a pace society allows it to. Regulators have permitted it to advance faster than institutions can react to it, increasing its potential risks that stretch from imminent to long-term societal damage. The most notable risks include reinforcing misinformation and inequality, exacerbating environmental damage, initiating widespread job displacement and inviting the onset of a future existential catastrophe controlled by rogue AI robots. For years, Elon Musk was one of the loudest voices warning that AI was “one of the biggest threats to humanity.” He spoke about AI development as a threat requiring immediate attention to ensure long-term stability, mirroring early rhetoric about climate change. Other leading scholars and tech leaders have made similar comparisons, noting that in some ways, AI is “like climate change and the planet.” In its earliest years, OpenAI – an AI company Musk co-founded with Sam Altman – reflected this ethos: a nonprofit dedicated to building safe and beneficial AI, a counterweight to Big Tech, and an institution designed to protect humanity rather than accelerate its destruction. But when OpenAI released ChatGPT in 2022, sensational headlines triggered a rush of investments, drowning out concerns about ethical AI development. Investors, startups, and tech leaders saw enormous profit potential, ditching calls for responsible use to pursue rapid, aggressive AI without a counterweight to advance regulation. While AI can offer considerable potential benefits, its risks have already materialized, with others likely to emerge as capabilities continue to advance. Yet some policymakers and tech leaders argue that rapid AI development is an imperative for countering geopolitical competition against China, a long-standing rival whose rapid technological rise has become an excuse for justifying extreme exceptions for tech companies. For instance, companies like OpenAI have proposed abandoning fundamental intellectual property laws to the White House, as a tactic to counter China’s threat. They have suggested relaxing data privacy regulations and dulling rules on disclosure requirements. But these reasons presume that a race-to-the-bottom approach is inevitable, and neglects the core pillars of our international system; a system rooted in diplomacy, dialogue, and cooperative governance. While efforts to combat global warming and climate change have shown how global governance can fall short, climate change is far from analogous to lawless AI development. While the comparison rightfully illuminates a reality that both AI and climate change carry potential for future existential harm, it suggests that AI may become yet another looming catastrophe that the public does not feel is urgent enough to confront. This raises the unsettling possibility that AI regulation is delayed to some distant future, when intervention is far too late. 

This research paper explores the dynamics of an intervention at a critical juncture in AI development, backed by Elon Musk, who is an actor uniquely entangled within both global superpowers. I seek to address whether Musk functions as a “double agent” or a “diplomat” in advancing U.S.–China cooperation on AI governance to deescalate aggressive methods by which AI technologies are presently being developed. I analyze his unique position as an individual whose wealth is deeply intertwined with China’s success, yet who has also secured allyship in the White House, as an informal advisor to the President and appointed director of a U.S. government agency. This paper draws from Musk’s shifting views to illuminate his flexible rhetorical stance on AI, drawing from public statements from 2019 through 2025. I assess U.S. and Chinese priorities in AI, present risks of non-cooperation, and evaluate Musk’s potential candidacy as a diplomatic figure. Finally, I argue in this paper that, in spite of his controversial position as a “walking conflict of interest,” Elon Musk remains our most effective diplomat to advance U.S.–Chinese cooperation on AI development and regulation. The repercussions of failing to collaborate with key global actors on AI governance, including China, carries grave consequences for global order and collective security, repercussions more severe than society has ever experienced.  

2. Background: What Drives Musk? 

Many call him a “genius,” a modern day “Einstein” whose strange behaviors are rooted in a genuine commitment to continued exploration and discovery – a society that innovates, transforms, and indefinitely becomes better. Others, including his own biographer, Walter Isaacson, describe him as “crazy” and a “risk-seeking man-child who resists potty training,” exposing his stubborn and occasionally revengeful tendencies. These competing narratives complicate the way Musk is publicly understood, and highlights the controversy surrounding his reputation. Musk was initially hailed a climate activist whose vision of the human purpose can be traced to a techno-futurist philosophical concept, known as longtermism. In 2022, Musk reposted a 2003 paper written by Nick Bostrom, an Oxford philosopher associated with this ideology, calling the paper “likely the most important paper ever written.” The paper, titled “Astronomical Waste: The Opportunity Cost of Delayed Technological Development” argues that for every second humanity delays colonizing Mars, society risks forfeiting the potential existence of ten trillion human lives. Musk’s embrace of this philosophy not only rationalizes his subsequent business endeavors in combatting climate change, but also propelled him into the AI industry, resonating with other longtermists who believe that technology is always the remedy to humanity’s most existential threats. His perception of climate change as an existential human threat drove him to become a proponent of imminent intervention. After becoming Tesla’s CEO in 2008, Musk reignited global interest in electric vehicle (EV) expansion to address climate change and laid the groundwork for its future role in China. In 2015, he warned of the devastating consequences of delaying this transition, cautioning that there will be “more displacement and destruction than all the wars in history combined.” Musk’s consistent rhetoric forced a strong sense of urgency on investing and transitioning towards renewable energy, which not only reinforced his longtermist views but also appeared to strategically bring attention to his companies.

Musk’s early engagement with AI adopted a similar risk-averse stance. Musk’s first encounter with AI was a simple 2011 investment in DeepMind, followed by an unsuccessful attempt to outbid Google to acquire the company. His quest to lead AI translated into developing and integrating automation in Tesla and SpaceX projects. In 2015, he co-founded OpenAI with current CEO Sam Altman as a non-profit devoted “to ensur[ing] that artificial general intelligence benefits all of humanity.” At the time, Musk’s philanthropy closely aligned with this mission, confirmed by his $10 million donation to the Future of Life Institute, which supports AI safety research. His initial rhetoric on artificial intelligence mirrored those of his worries about climate change. He repeatedly warned that AI is “quite a dangerous technology,” underscoring the need for regulation to ensure “that AI does not turn against us or destroy humanity.” With human interest at the core of his messaging, Musk was championed as a leading voice in both climate and AI safety activism. Shortly after, OpenAI realized it needed significantly more capital to achieve artificial generative intelligence and convened internal discussions about a possible transition towards a for-profit company. Musk agreed, but only conditionally, proposing a Tesla merger with OpenAI to use the existing company as its “cash cow,” but the proposal was rejected by the board. Musk became furious at the board’s decision and believed OpenAI would never be successful without Tesla’s attachment. In a published statement, OpenAI wrote that Musk challenged the company to raise billions on its own, declaring that he was going to establish a relevant competitor to Google and DeepMind himself, and parted from the company. But in 2022, Musk was unexpectedly backed into a corner, when his projections about OpenAI were proven faulty.

When OpenAI struck a major $1 billion deal with Microsoft and subsequently released the sensational ChatGPT tool in late 2022, Musk’s initial skepticism was suddenly contested by the new partnership. He immediately tweeted that OpenAI was “essentially captured by Microsoft,” and criticized OpenAI for abandoning its original mission as a nonprofit by becoming a profit-driven corporation. He promptly responded to OpenAI’s success by launching his own AI company, xAI, months later with the stated objective of “understand[ing] the true nature of the universe” and building what he calls a “maximally curious, maximally truth-seeking” AI. xAI was originally registered as a for-profit public benefit corporation (PBC) in 2023, legally binding the company to prioritize positive societal impact alongside its profit motives. Since then, xAI has “quietly dropped” its PBC status, and now operates as a traditional for-profit company, focusing on generating maximum returns for shareholders. After this transition, Musk rapidly vamped up AI investment, and began integrating its AI software across his range of companies, including Tesla and SpaceX, and also released his own chatbot named Grok, to counter ChatGPT’s primacy in the industry. He began constructing “Colossus” (a massive GPU supercomputer in Tennessee) which the company uses to train AI models, boosted pay for AI engineers to prevent them from being poached by OpenAI, and even filed two lawsuits against OpenAI, alleging it had become a “closed source, maximum-profit” entity that violated anticompetitive practice and abandoned its founding mission. He repeatedly denounced monopolistic powers, including Microsoft, Apple, and OpenAI, warning that these big tech companies arouse “a profit-maximizing demon from hell.” His aggressive antics led him to amend his original lawsuit against OpenAI to include Microsoft, and threatened to sue Apple, saying the company would make it “impossible for any AI company besides OpenAI to reach #1 in the App Store,” which he posits as a clear violation of antitrust laws. Together, these impulsive moves suggest an underlying resentment Musk has carried against OpenAI since it launched ChatGPT, which serves as his primary motivation to outperform OpenAI in some domain and affirm his original convictions about the company’s failing direction. His frustration at his sense of having fallen behind has also influenced Musk’s discourse on AI governance, characterized by contradictions and notable variations in sentiment across time and audience. While amassing AI research and development himself, Musk has frequently reiterated the dangers of AI as a “demon” in need of regulation, raising important questions about the extent to which his personal priorities shape his rhetoric. 

While attempting to decelerate competitor progress, he pursued direct political involvement to control a stake in AI policymaking. He began by securing a government contract through the Chief Digital and Artificial Intelligence Office to provide advanced AI capabilities for national security challenges, alongside OpenAI and Google. He also became a senior advisor to President Trump, serving as a “special government employee” of the executive order-established Department of Government Efficiency (DOGE), in a government cost-cutting initiative. The Elon Musk we know today is nearly unrecognizable. Despite once being acclaimed as a central figure in global decarbonization, his recent denial of climate change has fueled misinformation and has stirred confusion and controversy as to his motives and interests. His stance on AI has followed a similar trajectory, shifting dramatically over just a few years, as his commercial interests began consuming inceptive commitments to safeguard responsible and ethical use of AI. 

3. The Geopolitics of AI: Comparing U.S. and China AI Political Interests and Why Cooperation is Imperative

Assessing the potential diplomatic utility of Elon Musk as an informal intermediary requires examining the political and ideological foundations shaping U.S. and Chinese approaches to AI policy. Although both states recognize AI as a transformative technology with profound economic and security implications, their AI governance models differ sharply. These differences stem from underlying contrasts in political ideology, institutional structure, and conceptions of state authority. The U.S. has proposed a decentralized governance model and market-led AI innovation, prioritizing individual liberty and technological primacy. By contrast, China has embedded AI development in a centralized system under state oversight, emphasizing risk management and long-term strategy. Paradoxically, China’s restrictive domestic model enables it to present itself as a credible advocate for global AI governance, while the United States’ liberal model constrains its willingness to lead multilateral regulatory efforts.

1. The United States: “Permissionless Innovation” and Strategic Competition

The American 2025 AI Action Plan, headlined with the phrase “Winning the Race,” immediately casts AI development as a zero-sum geopolitical competition that can only be won through minimal regulatory intervention. President Donald Trump repeatedly warned that AI could “reshape the global balance of power,” framing supremacy as a “national security imperative” which requires unilateral dominance. In the action plan, China is explicitly identified as a strategic competitor whose technological supremacy would be antithetical to American principles of liberty and free expression. As Senator Ted Cruz proclaimed: “It’s a race, and if China wins the race, whoever wins, the values of that country will affect all of AI. We don’t want China’s values of surveillance and centralized control by the communist government governing AI.” Such rhetoric underscores the extent to which U.S. AI policy is shaped not only by economic considerations, but also by ideological resistance to governance models perceived as inherently anti-democratic.

Until recently, institutional AI governance in the U.S. has remained highly fragmented. Rather than pushing a comprehensive federal AI statute, Washington relied on a patchwork of executive orders and voluntary industry commitments. Guiding documents, such as the National Institute of Standards and Technology’s AI Risk Management Framework, support the U.S. preference for non-binding, flexible mechanisms that provide leeway to private actors. This decentralization is consistent with the laissez-faire tradition that seeks to preserve space for competition and free expression. Constitutional constraints, such as the First Amendment, further limit the federal government’s ability to impose restrictions or preemptive controls on AI systems, structurally distinguishing the U.S. model from more interventionist regimes like China. Despite such limitations, in recent weeks, fierce pro-AI lobbying campaigns have pushed Trump to sign a new executive order that “neuters” stringent state AI laws deemed to undermine American AI dominance. Trump directed federal regulators to withhold funds for non-compliant states, sparking bipartisan opposition to the order, which will likely face future challenges in court. Such an overstep on state authority highlights the growing influence by tech firms on the formation of AI policy.

This promise of “permissionless innovation” shapes the American posture toward international AI governance. While the U.S. has participated in certain forums such as the G7 Hiroshima AI Process and endorsed voluntary safety norms, it has consistently resisted binding multilateral oversight frameworks. In January 2025, Trump called China’s DeepSeek AI chatbot a “wake-up call” for the American tech industry. Soon after, his administration unveiled the 2025 AI Action Plan which prioritized domestic infrastructure development, semiconductor reshoring, and bilateral agreements over engagement in international institutions. Leadership in AI, from an American standpoint, is measured by technological dominance rather than leadership in global forums. This orientation represents a stark departure from historical U.S. leadership in multilateral governance and reflects a broader retreat from institution-building in emerging tech domains.

Reaching Washington’s desired level of innovation demands that federal regulators “create conditions” for private sector prosperity, achieved through the removal of onerous regulations, protecting free speech and liberty, and encouraging open-source AI. For instance, the framing of AI innovation as a strategic competition with China has driven restrictive export controls throughout numerous administrations. Beginning in 2022 under the Biden Administration, the U.S. imposed limits on China’s access to advanced AI chips and semiconductor manufacturing equipment. Justified on the ground of national security imperatives, these measures were carried forward into the Trump Administration. However, a recent December 2025 decision overturned these stringent blocks and reauthorized the export of certain NVIDIA’s chips to China, indicating the limits of unilateral pressure and highlighting the interdependent nature of global AI supply chains.

The U.S. model is further complicated by blurred boundaries between public authority and private influence. The appointment of tech investors, such as naming David Sacks as the White House AI and crypto czar, illustrates the reliance on industry insiders as policy architects. While defended as a means of leveraging technical expertise, such arrangements have drawn criticism for ethical conflicts of interest. Similar concerns surround Elon Musk’s political ascent and underscore a broader pattern in which the private sector exercises influence over national AI policy as “special government employees.” This elite-driven, market-centered governance structure is consistent with American pluralism but complicates efforts to present a unified and neutral leadership role in international AI regulation.

2. China: Centralized Control and Global Governance Advocacy

China’s approach to AI governance stands in stark contrast. Since the release of the New Generation Artificial Intelligence Development Plan in 2017, Beijing has pursued a centralized and long-term strategy that integrates technological innovation with state oversight. The plan outlines clear milestones for 2020, 2025, and 2030, which signals a deliberate effort to guide market behavior through subsidies and incentivizing regulatory alignment. While China, like the United States, views AI as critical to national competitiveness and security, its official strategy avoids explicit framing of a bilateral race with the United States. This omission allows China to rhetorically position itself as a cooperative stakeholder, as opposed to a geopolitical rival.

China’s AI governance framework emphasizes safety standards and political control. A growing number of regulations recently surfaced, codifying new cybersecurity laws, data security statutes, personal information protection rules, and algorithm-specific measures that integrate oversight directly into the AI development lifecycle. In September 2025, Chinese regulators further advanced ethics rules by introducing the “AI Plus” plan which mandated ethics reviews, content labeling, and compliance mechanisms for AI-generated material. Non-compliance carries severe penalties, ranging from fines and business suspensions to criminal liability. These measures demonstrate the precautionary governance approach China is demanding, in which AI risks are preemptively managed through supervision. 

China’s emerging AI policy is inseparable from domestic stability and regime security. Algorithmic governance tools, such as facial recognition technologies, are regularly deployed to monitor public discourse and track social behavior. The concentration of political power enables Beijing to enforce compliance and to align private-sector innovation with state priorities. While such controls would face substantial resistance in liberal democracies, China’s tolerant political culture and centralized authority structure facilitate their effective implementation. As a result, China’s AI policy is internally coherent and institutionally enforceable, despite coming at the expense of individual freedoms. 

This centralized domestic control allowed China to assume a proactive stance in international AI governance. Beijing’s Global AI Governance Initiative and Action Plan for Global Artificial Intelligence Governance frame AI as a shared human resource requiring collective oversight. These proposals emphasize open-source collaboration, cross-border risk management, and a governance system in which the United Nations plays an authoritative role. China has already positioned itself as a champion of inclusive AI development by offering technological assistance and capacity-building support to countries in the Global South. In October 2025, President Xi Jinping reiterated interest in establishing a World Artificial Intelligence Cooperation Organization, reinforcing China’s commitment to shape the institutional body of global AI governance. This international posture strengthens China’s reputational standing at a time when U.S. policy appears increasingly unilateral and adversarial. This tension demonstrates how the same mechanisms of control that constrain domestic actors in China could allow Beijing to credibly argue for international precaution and collective responsibility. In this sense, China’s restrictive governance model ironically affirms its diplomatic appeal in international AI discussions.

3. Comparative Implications

The divergence between U.S. and Chinese AI governance models complicate bilateral cooperation while simultaneously creating a vacuum for informal diplomacy and non-state intermediaries. This opening could allow figures like Elon Musk, who holds stakes in both states, to broker ideological divides and advance a more stable future. 

4. Risks of an Uncoordinated AI Race

Although the future capabilities of AI remains uncertain, one outcome is inevitable: a “race-to-the-bottom” dynamic between the globe’s two superpowers risks producing a singular technological hegemon and destabilizes global order. The world is unprepared for an international system dominated by either scenario. Both an authoritarian model of centralized technological control and a revival of protectionist unilateralism would undermine decades of economic integration and institutional cooperation. Beyond redistributing the balance of power, the unrestrained development of AI threatens to generate cascading global risks, including global security instability, eroding international governance frameworks, legal fragmentation, and destabilizing already fragile bilateral relations. 

1. Global Security Threats 

Since the 1980s, globalization transformed international connectivity by intensifying economic interdependence, accelerating the flow of information, and compressing distance through digital mediums. AI operates in a borderless domain, which complicates its regulation through codified national legislation. While the concept of political sovereignty remains foundational to international relations, physical borders are intrinsically ineffective at containing technologies that exist in digital environments. As a result, the benefits of AI, along with its accompanying risks, will inevitably transcend national boundaries. This shared exposure creates shared vulnerability, and the need for assuming shared responsibilities. In the absence of cooperative governance, AI competition will continue to incentivize speed over safety, increasing the likelihood of destabilizing outcomes. An unregulated AI arms race would amplify the risk of escalation, miscalculation, and unintended conflict. Global security in this tech-dominated era therefore depends not on unilateral dominance, but on shared norms, transparency, and mutual restraint. 

2. Erosion of International Governance Frameworks 

In the event of a U.S.–China stalemate, the legitimacy of existing international institutions are at stake. The United Nations was designed to prevent conflict, promote collective security, and address global challenges through multilateral coordination. The UN Security Council in particular serves as a steward of international peace and stability, with both the United States and China occupying permanent seats. However, longstanding rivalry between Washington and Beijing has increasingly paralyzed the Security Council, as both powers routinely abuse their veto authority to block initiatives perceived as favoring the other. If AI governance follows a similar path, where negotiations collapse into bilateral maneuvering or informal arrangements outside multilateral frameworks, the credibility of the United Nations risks further erosion. Suspending international dialogue in favor of ad hoc agreements signals that global institutions are no longer fit to manage emerging technologies, setting a dangerous precedent for future global crises. International bodies play a critical role in pooling expertise, coordinating risk mitigation, and establishing neutral norms. Marginalizing these institutions in AI governance would fragment global efforts and weaken the very mechanisms designed to manage transnational risks. 

3. Legal Fragmentation and the Problem of Regulatory Patchwork

In an inherently global technological ecosystem, fragmented regimes create significant governance challenges. Diverging national standards and interpretive frameworks complicate dispute resolution, compliance, and enforcement across borders. Recent U.S. efforts to preempt state-led AI regulation illustrate the tension between regulatory coherence and deregulatory ambition. President Trump recently signed an executive order seeking to block individual states from regulating AI in their respective jurisdictions. According to a text published by the White House, the order aims to “to sustain and enhance the United States’ global AI dominance through a minimally burdensome national policy framework for AI.” While the stated objective of such measures is to avoid a domestic patchwork of inconsistent laws, the broader issue is not the presence of regulation itself, but the absence of coordinated international standards.

4. Decoupling and the Risks of Technological Isolation

Absent cooperation, technological decoupling will likely accelerate. China’s November 2025 mandate requiring the exclusive use of domestically produced AI chips in state-funded data centers reinforces this trend. By mandating the replacement of U.S.-made chips in data facilities and subsidizing domestic firms affected by higher operating costs due to America’s chip export ban, Beijing signaled their confidence in its capacity to develop high-performance AI systems independently. Since U.S.-based NVIDIA dominates over 90 percent of the global market, China’s determination to entirely phase out U.S. AI chips from Chinese data centers is a notable effort. Technological isolation carries severe consequences. Cutting China off from global supply chains may create more secrecy, reduce transparency, and accelerate parallel innovation beyond the reach of international oversight. Industry leaders, including NVIDIA CEO Jensen Huang, warn that “China will surpass the U.S. in the AI race” if current trajectories persist. The emergence of low-cost Chinese AI models, such as those developed by DeepSeek, has already disrupted assumptions about the scale of investment required for advanced AI, drawing comparisons to speculative investments preceding the dot-com collapse. From a U.S. national security perspective, the absence of cooperation will allow China to advance on its own capabilities. When states frame AI exclusively as a competitive race, they are incentivized to prioritize rapid deployment and technological advantage over safety and accountability. This dynamic increases the likelihood of dangerous shortcuts in model training and integration into military and infrastructure systems. Cooperative mechanisms can mitigate these risks by enabling mutual oversight and reducing incentives for reckless acceleration. 

5. Musk and China: Strategic Symbiosis or Vulnerability?
   1. Stimulating China’s EV Market and Technological Rise

China’s decision to welcome Tesla into its domestic market was neither accidental nor purely commercial. With Beijing mandating that by 2030, 40 percent of all vehicle sales should be EVs, Tesla’s entry in 2014 aligned with China’s long-term industrial strategy. At the time, analysts at Forbes dismissed Tesla as a niche luxury brand and “small player” who was unlikely to disrupt China’s automotive sector. But in 2019, when Tesla’s $2B billion investment in its Shanghai Gigafactory established China’s first wholly foreign-owned automobile plant, this pivotal moment proved the initial assessment to be short-sighted. Beijing facilitated this exception by “rewriting its playbook” to accommodate Musk, granting Tesla unprecedented market access in exchange for long-term technological spillovers. This arrangement was mutually beneficial and proved to become a resounding success for both parties. Tesla localized production, reduced costs, and gained privileged access to the world’s largest auto market. In return, China leveraged Tesla’s presence to accelerate competition in its domestic EV market. The Shanghai Gigafactory intensified competition and pressured Chinese manufacturers to rapidly scale production and innovation. Between 2019 and 2023, Shanghai authorities extended significant concessions to Tesla, including “cheap land, low-interest loans and tax incentives” and a reduced corporate tax rate of 15 percent, ten points below the standard rate. By 2021, Tesla was producing roughly half of its total vehicles in China, underscoring the centrality of the Chinese market to Musk’s automotive empire. 

Tesla’s localization followed a familiar Chinese industrial pattern. Similar to Apple’s inclusion, Chinese market access came with expectations, such as integration with local supply chains, knowledge transfers, and cultivating domestic suppliers at lower costs. The so-called “catfish effect” took shape. Tesla’s mere presence in China lifted struggling automaker companies, facilitated the exchange of knowledgeable engineers, and accelerated technical learning across China’s EV sector. This dynamic significantly reduced the capital and time typically necessary for domestic firms to develop advanced technologies, saving Chinese companies billions in R&D costs. As predicted by industry executives, new energy vehicle sales in China surged, more than doubling in subsequent years. This remarkable success underscored the profound impact Tesla had on the Chinese economy. 

Significant consequences accompany this symbiosis. The first Shanghai Gigafactory did more than anchor Tesla’s production – it implicitly tied Musk’s personal fortune to China. Tesla’s operations became subject to strict Chinese data security regulations, which required all locally collected data to be stored domestically. While Beijing demonstrated some flexibility in certain areas, it retained leverage through its ability to constrain Tesla’s operations at will. Over time, Musk’s public posture shifted accordingly. In China, he emerged as an enthusiastic advocate of Beijing’s governance style, praising its work culture and political systems. His admiration for China’s “hyper-repressive” labor system aligned with his broader philosophy that efficiency and technological progress justify the removal of regulatory and social constraints. His willingness to embrace mass layoffs, aggressive cost-cutting, and deregulation both within his companies and later through his role in the Department of Government Efficiency reflects a departure from his earlier pledges to humanitarian progress. For Musk, technological breakthrough has become the overriding objective, curbing earlier concerns about labor protections, oversight, or long-term social consequences. 

2. Political Ascension in the United States: Influence, Conflict of Interest, and Power

Musk’s rise into the Trump-era political apparatus is striking not merely because he lacks formal political experience, but because he has dramatically reversed his ideology over time. As recent as 2022, Musk publicly urged Trump to exit the presidential run, declaring it was “time for Trump to hang up his hat.” That same year, Musk formally announced his abandonment of the Democratic Party, accusing it of becoming “the party of division and hate.” His acquisition of X (formerly Twitter) and the immediate reinstatement of Trump’s account following the January 6th insurrection on the Capitol marked a decisive political turn for Musk. From that moment onwards, Musk positioned himself as a staunch political ally of Trump. The following year, Musk’s support for Trump intensified as he condemned indictments against Trump as politically charged, and by mid-2024, Musk emerged as the largest donor in Trump’s presidential re-election campaign. Following the assassination attempt on Trump in July 2024, Musk formally endorsed him and pledged millions of dollars per month to his campaign. Trump reciprocated the gesture by promising to “make life good” for Musk, an indication that preferential treatment can be bought through political endorsement. Upon his return to office in January 2025, Trump created the Department of Government Efficiency (DOGE), and placed Musk as the head advisor. DOGE granted Musk the authority to restructure the federal government through mass layoffs, forced agency closures, cancellation of research programs and grants, and the dismantling of core federal agencies. The scope of this power was unprecedented for any private citizen. Musk’s overlapping commercial interests made this arrangement especially troubling as his companies are deeply embedded in U.S. national security infrastructure. SpaceX, for example, functions as a cornerstone of American military space operations, while Starlink provides critical satellite communications for the U.S. and allied forces. At the same time, Musk’s ongoing AI ambitions through xAI place him as a key supplier in the emerging military AI ecosystem. The Department of War (formerly known as the Department of Defense) has been seeking large-scale autonomous systems and computers for command-and-control applications, which are precisely the technologies xAI is developing. 

6. A Double Agent or Diplomat? Evaluating Elon Musk’s Suitability

Elon Musk unconventionally sits at the center of the U.S.–China tech rivalry, and has been described by various critics as China’s “top puppet,” a technocrat in state office, and a visionary who has referred to the U.S. and China as inseparable “conjoined twins.” Musk is simultaneously a U.S. national security contractor and a businessman whose wealth is deeply entangled with China’s regulatory leniency. This convergence raises a central question: Does Musk’s unique positioning render him a liability, or does it make him one of the few figures capable of facilitating cooperation where formal diplomacy has stalled? In an era of heightened rivalry and diplomatic paralysis, Musk occupies an ambiguous space between state and market, which may allow him to function as an effective intermediary in U.S.–China cooperation.

On the one hand, his divided incentives and ideological volatility cast doubt on his reliability as a neutral actor. Dependent on Chinese manufacturing and subsidies, his extensive ties to China fuel concerns in Washington that Beijing views him as a strategic asset. Musk has repeatedly echoed Chinese talking points on sensitive issues such as Taiwan and global AI governance, reinforcing perceptions that his economic reliance on China shapes his public posture and discourse. He is beloved in China and hailed a “global idol,” who always receives a “hero’s welcome” as he is greeted by China’s top premiers and officials during his visits to the country. American lawmakers argue that no individual whose wealth hinges so directly on a rival state should wield influence over U.S. AI policy at such a critical geopolitical standoff. The contrast in consumer responses underscores this vulnerability. As Musk aligned himself with the American political right, Tesla’s sales fell sharply in the U.S., yet rose by nine percent in China, insulating his revenue stream from political backlash and deepening Beijing’s leverage. At the same time, Musk’s deep integration with U.S. national security, through SpaceX’s role in military satellite infrastructure and rocket capabilities, create reciprocal pressure. Since 2008, Musk has received $38 billion from the government to expand his businesses domestically. This convergence creates loyalty pressures from both sides. Musk cannot alienate U.S. defense agencies without jeopardizing SpaceX contracts, but he is equally constrained from alienating Chinese regulators without risking Tesla’s overseen operations. Either government could quickly destabilize a core pillar of Musk’s empire with a single regulatory decision, placing Musk in a position of divided loyalty that resembles informal intelligence exposure more than neutrality.

Yet this exact division of stakes gives Musk unusual diplomatic potential. Few individuals command sustained access, credibility, and technical expertise in both Washington and Beijing. Despite increasingly deregulatory rhetoric, Musk has repeatedly voiced concern about existential AI risk, signing a 2023 letter calling for a pause on large-scale AI training and later endorsing California’s SB 1047, the most significant U.S. AI safety legislation to date. He has also appeared alongside U.S. and Chinese representatives at international AI forums, framing safety as a shared civilizational concern rather than a zero-sum contest. Reportings have also indicated that Musk believes China has a vested interest to support an international AI governance framework, a kind of engagement that suggests he sees some basis for US-China cooperation on AI regulation. Musk’s desire to remain central to outcomes, command attention, and define the AI trajectory should not be dismissed as vanity alone. It may be the motivating driver that enables him to press for cooperation, particularly if unregulated competition threatens his businesses and legacy. In this sense, Musk embodies a new form of privatized diplomacy: a figure whose self-interest, influence, and ambition could either deepen great-power mistrust or, if carefully constrained, help communicate the costs of non-cooperation in ways traditional diplomats could not.

7. Addressing Counterarguments

Critics may contend that Musk’s influence is overstated, and that U.S – China relations are ultimately shaped by state-to-state relations that extend beyond tech policy. Some Chinese academics have similarly argued that Musk’s frequent visits and business operations do not translate into meaningful influence over formal diplomatic decision-making, underscoring the distinction between commercial access and official state authority. Others point to Tesla’s recent sales decline in the U.S. as evidence that Musk’s political persona has eroded his credibility and public legitimacy, limiting his ability to function as a trusted intermediary. This paper argues, however, that such critiques underestimate Musk’s structural significance. Musk’s combination of economic scale, cross-border entanglement, political access, and technical expertise is unprecedented for a private individual. As the world’s richest individual, driven by his stakes in Tesla and SpaceX, whose core operations are embedded in both U.S. national security and China’s industrial infrastructure, Musk possesses incentives that few actors can match. While by no means does this justify his formal authority over AI governance, it does position him uniquely capable of facilitating informal safety dialogue as preserving stability also safeguards his own wealth and influence. 

A second critique holds that U.S. – China cooperation on AI is fundamentally crippled given escalating rivalry in other important areas, like trade. Yet historical precedents, such as joint response during the COVID-19 pandemic and sustained engagement in arms control negotiations demonstrate how cooperation is plausible when confronted with shared and unavoidable risks. As a transnational threat, AI presents a comparable incentive for cooperation rather than permanent deadlock.

8. Conclusion

While it may be tempting to dismiss Elon Musk as too conflicted, rhetorically volatile, and politically unqualified to facilitate U.S.–China cooperation on AI, this paper agrees that despite him truly being all of these things, these precise traits make him acutely relevant to the partnership. Musk’s financial and operational entanglements in both the United States and China do not disqualify him from influencing cooperation, but crucially place him at the center of the partnership. His ambitions to dominate the AI frontier, coupled with his recognition of AI safety as an existential concern, position him as a rare actor whose personal incentives align with de-escalation rather than unchecked rivalry. In this sense, Musk exemplifies a new form of privatized geopolitics, in which individuals possess the access and leverage to shape great-power interactions. While this paper does not argue that Musk should be empowered with formal diplomatic authority, it illuminates the broader implications that global governance on AI can no longer exclusively rely on traditional state-led mechanisms. As globalization and a concentration in tech continues to elevate private actors, policymakers must grapple with the reality that influence over AI trajectories increasingly lies outside conventional diplomatic methods. Informal intermediaries, despite their imperfections, might become necessary complements to formal institutions that have proven to be ineffective. Whether Musk ultimately advances cooperation will depend on how states choose to engage or constrain such actors, but his case makes clear that the future of AI governance will be shaped as much by private power as by public policy.