Tesla shareholders on Thursday approved a plan that could make Elon Musk the world’s first trillionaire, two days after New Yorkers elected a tax-the-rich candidate as their next mayor.
These discrete moments offered strikingly different lessons about America and who deserves how much of its wealth.
At Tesla, based in the Austin, Texas, area, shareholders have largely bought into a winner-takes-all version of capitalism, agreeing by a wide margin to give Mr. Musk shares worth almost a trillion dollars if the company under his management achieves ambitious financial and operational goals over the next decade.
But halfway across the country, in the home to Wall Street, Zohran Mamdani’s victory served as a reminder of the frustrations many Americans have with an economic system that has left them struggling to afford basics like food, housing and child care.
These are vastly different arenas, to be sure. But that split-screen reality speaks to a larger divide in American business and politics. On one side are billionaires like Mr. Musk and their many supporters, including President Trump, who see the financial success of a small group of executives as something to be celebrated and emulated.
On the other are progressives like Mr. Mamdani, a democratic socialist, who are calling for something more akin to the social welfare systems of Western Europe. Mr. Mamdani campaigned on using higher taxes on businesses and the wealthy to pay for universal child care and free buses — promises that helped him win a resounding victory against two more conservative candidates.
Much like an earlier pay plan that Tesla shareholders approved in 2018, this 12-step package asks Mr. Musk, the company’s chief executive, to vastly expand Tesla’s stock market valuation — to $8.5 trillion from around $1.4 trillion — while hitting a variety of other goals. Those include selling one million robots with humanlike qualities and 10 million paid subscriptions to the company’s self-driving software.
“What we’re about to embark upon is not merely a new chapter of the future of Tesla, but a whole new book,” Mr. Musk said, after thanking shareholders for their support.
Tesla’s stock price fell modestly in after hours trading.
Tesla’s directors and some investors, including the board that oversees Florida’s public pension fund, hailed the $1 trillion pay plan as a way to motivate Mr. Musk, who is already the world’s wealthiest person, to build futuristic products like cars that can drive themselves.
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“Those who claim the plan is ‘too large’ ignore the scale of ambition that has historically defined Tesla’s trajectory,” the Florida State Board of Administration said in a securities filing describing why it voted for Mr. Musk’s pay plan. “A company that went from near bankruptcy to global leadership in E.V.s and clean energy under similar frameworks has earned the right to use incentive models that reward moonshot performance.”
The plan is structured in such a way that if Mr. Musk makes money, the company’s investors do, too — a point that the fund manager Cathie Wood made this week on the social media platform X.
“I do not understand why investors are voting against Elon’s pay package when they and their clients would benefit enormously if he and his incredible team meet such high goals,” Ms. Wood, who is the chief executive of Ark Invest, wrote.
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