Business
Column: Who elected Elon Musk our arbiter of social norms?
Here’s a handy two-step process for taking a thoughtful and judicious approach to the burning social and political issues of our time:
1. Examine closely the position taken by Elon Musk, and;
2. Go the other way.
Musk’s drift — more precisely, his headlong dive — into right-wing orthodoxies has been well-chronicled. He has openly endorsed antisemitic tropes, called for the prosecution of the respected immunologist Anthony Fauci (evidently buying into the right-wing fantasy that Fauci helped create the COVID-19 pandemic), and associated himself with a grotesquely ugly conspiracy theory about the assault on the husband of former House Speaker Nancy Pelosi.
This is the final straw.
— Elon Musk, explaining that California’s pro-transgender law provoked him to relocating his companies to Texas
He reversed policies at X, formerly Twitter, designed to block hate speech, including racist and antisemitic tweets. That has turned the platform into a hive of repulsive partisan commentary.
(Musk blames an imaginary advertisers’ “boycott” for the user decline at X, though the repulsive atmosphere of the platform since his acquisition probably has done more to drive users and advertisers away.)
Musk again put his acrid personal worldview vividly on display with his announcement Tuesday that he would move two of his private companies, Hawthorne-based SpaceX and San Francisco-based X, to Texas.
He made clear that his decision was triggered by Gov. Gavin Newsom’s signing of a law that bars school districts from requiring teachers to notify parents of their children’s gender identity changes. Newsom signed the law on Monday.
“This is the final straw,” Musk posted on X. He described the law as one of “many others” in California “attacking both families and companies.”
A few things about this.
If anything, Musk’s corporate activities point to what is often described as a “whim of iron.” He defends his policies and politics as derived from painstaking consideration based on immutable laws of human behavior, but they don’t hold water on those terms. Instead, they point to the social dangers of endowing self-interested personalities with the money to buy unaccountable influence in conflict with the public interest.
Musk appears to have a real problem with transgender rights. According to the Musk biography by Walter Isaacson, this may have originated with the decision of his eldest child, Xavier, to transition at the age of 16. “I’m transgender, and my name is now Jenna,” she texted a relative. “Don’t tell my dad.”
Jenna followed up with a political awakening that Musk ascribed to her attendance at a private school in California. “She went beyond socialism to being a full communist and thinking that anyone rich is evil,” he told Isaacson. Jenna broke off all contact with him.
Further, as is the case with much of Musk’s worldview, his claim about California’s attacks on families and companies is fundamentally incoherent.
The new California law is the antithesis of an attack on families. It aims to protect the right of parents to seek the most appropriate medical treatments for their children. Anti-transgender activists who have gotten laws enacted in 20 red states interfering with these medical consultations typically characterize them as “parents’ rights” measures, when they’re just the opposite — they interpose right-wing ideologies between these families and their doctors.
That’s the state of play in Texas, the putative new home of SpaceX and X. There, a law that became effective on Sept. 1, 2023, prohibited treatments widely accepted by medical professionals for “gender dysphoria” experienced by adolescents.
These are chiefly the use of puberty blockers to give the patients more time to affirm their gender perception, and once that stage is achieved the use of cross-sex hormones —estrogen for males transitioning to female, and testosterone for females transitioning to male.
The Texas law threatens physicians who violate the law in treating their patients with the loss of their medical license.
A trial judge, ruling in a lawsuit brought by parents of transgender youths and by doctors who treat patients in that position, blocked the law shortly before it was to take effect. The injunction was overturned late last month by the Texas Supreme Court in an 8-1 decision.
The majority made clear that its decision had nothing to do with the weight of medical opinion, which overwhelmingly supported the treatments at issue when undertaken through careful consultation.
The issue at the heart of the debate, asserted Justice James D. Blacklock in a concurring opinion, “is one of philosophy, morality, even religion. The medical debates at issue in this litigation are merely the surface-level consequences of deep disagreement over the deepest of questions about who we are.”
The majority justices ruled that the Legislature was entirely within its rights to place limits on medical practice and parental authority in Texas. They asserted that barring parents from seeking medically indicated treatment of their children’s gender dysphoria was no different from a state law forbidding minors from getting tattoos, even with their parents’ permission.
“Of course,” responded Justice Debra H. Lehrmann, the court’s lone dissenter, “there is nothing remotely medically necessary about tattooing.” Depriving adolescents of gender dysphoria therapies, on the other hand, can be severely injurious to the patient’s physical and mental health.
If Musk thinks that Texas’ policies on parental rights are superior to California’s, he might ask the parents of transgender youths who have been driven out of Texas to seek treatment because of this ignorant and ideologically infected law.
Texas boosters, Musk included, like to describe the state as the coming place for venture investing. The truth is rather different. According to the National Venture Capital Assn., Texas has been mired in also-ran status for at least the last decade, a period in which it has been supposedly booming.
California’s position as the top state in venture funding has never been seriously challenged. In 2023, California VC funds raised $37 billion; Texas ranked seventh, with less than $1.2 billion. Of the top 10 venture deals by value last year, the NVCA reckons, eight involved California companies. The others were located in New York and Washington, D.C. Texas had none.
And in terms of assets under management by firms based in the state, California continues to reign with $644.5 billion as of last year. Texas ranks fifth, at less than $32.5 billion. It was edged out by No. 4 Florida, with $33.6 billion, but the figures for both Florida and Texas are a big drop-off from No. 3, Massachusetts, with $121.7 billion.
It’s not as if Austin, where Musk is hanging his Texas Stetson, offers newcomers a paradisiacal environment. In 2022, TechCrunch dubbed Austin “a city of unicorns and tech giants.” The thrill hasn’t lasted. Recent transplants have found that its boosters’ depiction of a vibrant intellectual climate was oversold. “Austin is where ambition goes to die,” an unhappy California immigrant told Business Insider.
Then there are its punishing summers — 78 days of triple-digit temperatures in 2023 — and soaring housing prices. Although Austin boasts one of the features of tech hubs, a leading research institution in the University of Texas, the state’s partisan political environment has turned increasingly hostile, with bills passed into law this year banning diversity, equity and inclusion (DEI) programs and narrowing faculty tenure protections.
Texas has the most restrictive anti-abortion law in the nation, with an almost total ban and a prohibition even on private health plan coverage of abortions. That hardly makes for an inviting prospect for women of childbearing age or for young families interested in the full range of reproductive healthcare options.
One advantage Texas has over California is something a rich entrepreneur like Musk would appreciate the most: It has no state income tax.
Musk can scarcely claim that his own corporate policies are family-friendly. They are, however, arguably self-destructive. Consider his treatment of thousands of former Twitter employees who were summarily fired after he took over the platform in October 2022 and are suing to receive severance payments, bonuses and other benefits they were promised before the takeover.
The mass firings have given rise to about 2,000 arbitration cases and a dozen class-action lawsuits, according to Shannon Liss-Riordan, a Massachusetts labor lawyer who represents the workers in arbitration and filed the lawsuits.
Among the workers’ claims is that while Musk was working to close his acquisition of Twitter, as it was then known, the company promised employees that they would be entitled to “benefits and severance at least as favorable” as what Twitter provided before the Musk takeover. The promises were made by company executives in a series of all-hands meetings at Twitter headquarters and were written into the merger agreement Musk and Twitter management negotiated in April 2022.
“The promises were made to keep employees from fleeing the company during those chaotic months before Musk closed on the acquisition,” Liss-Riordan told me. “Then after he closed, he just defaulted on that promise.”
Neither Musk nor spokespersons for X or SpaceX could be reached for comment.
Although many if not most of the X employees were required to bring their claims to arbitration, Musk initially refused to pay the arbitration fees that are typically charged to the employer in such cases.
That has frozen the proceedings in more than 800 cases, though not those originating in California, Oregon and Nevada, where employers don’t have the legal ability to refuse. About a third of the 2,000 arbitration claims are in California, Liss-Riordan says.
Leaving aside the ethical implications of a company’s forcing employees into arbitration and then refusing to allow the cases to proceed, Musk’s demand that ex-employees submit to arbitration may be exceptionally more costly for the company than trying to reach a general settlement. Arbitration fees can average $100,000 per case, Liss-Riordan told me; hundreds of millions of dollars in claims may be at issue.
“You have to scratch your head over why Elon Musk has to fight this so hard,” she says. “Would it really be that big a deal to pay the employees what was promised to them? Frankly, it doesn’t seem worth his time.”
Business
Nike to Cut 1,400 Jobs as Part of Its Turnaround Plan
Nike is cutting about 1,400 jobs in its operations division, mostly from its technology department, the company said Thursday.
In a note to employees, Venkatesh Alagirisamy, the chief operating officer of Nike, said that management was nearly done reorganizing the business for its turnaround plan, and that the goal was to operate with “more speed, simplicity and precision.”
“This is not a new direction,” Mr. Alagirisamy told employees. “It is the next phase of the work already underway.”
Nike, the world’s largest sportswear company, is trying to recover after missteps led to a prolonged sales slump, in which the brand leaned into lifestyle products and away from performance shoes and apparel. Elliott Hill, the chief executive, has worked to realign the company around sports and speed up product development to create more breakthrough innovations.
In March, Nike told investors that it expected sales to fall this year, with growth in North America offset by poor performance in Asia, where the brand is struggling to rejuvenate sales in China. Executives said at the time that more volatility brought on by the war in the Middle East and rising oil prices might continue to affect its business.
The reorganization has involved cuts across many parts of the organization, including at its headquarters in Beaverton, Ore. Nike slashed some corporate staff last year and eliminated nearly 800 jobs at distribution centers in January.
“You never want to have to go through any sort of layoffs, but to re-center the company, we’re doing some of that,” Mr. Hill said in an interview earlier this year.
Mr. Alagirisamy told employees that Nike was reshaping its technology team and centering employees at its headquarters and a tech center in Bengaluru, India. The layoffs will affect workers across North America, Europe and Asia.
The cuts will also affect staffing in Nike’s factories for Air, the company’s proprietary cushioning system. Employees who work on the supply chain for raw materials will also experience changes as staff is integrated into footwear and apparel teams.
Nike’s Converse brand, which has struggled for years to revive sales, will move some of its engineering resources closer to the factories they support, the company said.
Mr. Alagirisamy said the moves were necessary to optimize Nike’s supply chain, deploy technology faster and bolster relationships with suppliers.
Business
Senate committee kills bill mandating insurance coverage for wildfire safe homes
A bill that would have required insurers to offer coverage to homeowners who take steps to reduce wildfire risk on their property died in the Legislature.
The Senate Insurance Committee on Monday voted down the measure, SB 1076, one of the most ambitious bills spurred by the devastating January 2025 wildfires.
The vote came despite fire victims and others rallying at the state Capitol in support of the measure, authored by state Sen. Sasha Renée Pérez (D-Pasadena), whose district includes the Eaton fire zone.
The Insurance Coverage for Fire-Safe Homes Act originally would have required insurers to offer and renew coverage for any home that meets wildfire-safety standards adopted by the insurance commissioner starting Jan. 1, 2028.
It also threatened insurers with a five-year ban from the sale of home or auto insurance if they did not comply, though it allowed for exceptions.
However, faced with strong opposition from the insurance industry, Pérez had agreed to amend the bill so it would have established community-wide pilot projects across the state to better understand the most effective way to limit property and insurance losses from wildfires.
Insurers would have had to offer four years of coverage to homeowners in successful pilot projects.
Denni Ritter, a vice president of the American Property Casualty Insurance Assn., told the committee that her trade group opposed the bill.
“While we appreciate the intent behind those conversations, those concepts do not remove our opposition, because they retain the same core flaw — substituting underwriting judgment and solvency safeguards with a statutory mandate to accept risk,” she said.
In voting against the bill Sen. Laura Richardson, (D-San Pedro), said: “Last I heard, in the United States, we don’t require any company to do anything. That’s the difference between capitalism and communism, frankly.”
The remarks against the measure prompted committee Chair Sen. Steve Padilla, (D-Chula Vista), to chastise committee members in opposition.
“I’m a little perturbed, and I’m a little disappointed, because you have someone who is trying to work with industry, who is trying to get facts and data,” he said.
Monday’s vote was the fourth time a bill that would have required insurers to offer coverage to so-called “fire hardened” homes failed in the Legislature since 2020, according to an analysis by insurance committee staff.
Fire hardening includes measures such as cutting back brush, installing fire resistant roofs and closing eaves to resist fire embers.
Pérez’s legislation was thought to have a better chance of passage because it followed the most catastrophic wildfires in U.S. history, which damaged or destroyed more than 18,000 structures and killed 31 people.
The bill was co-sponsored by the Los Angeles advocacy group Consumer Watchdog and Every Fire Survivor’s Network, a community group founded in Altadena after the fires formerly called the Eaton Fire Survivors Network.
But it also had broad support from groups such as the California Apartment Association, the California Nurses Association and California Environmental Voters.
Leading up to the fires, many insurers, citing heightened fire risk, had dropped policyholders in fire-prone neighorhoods. That forced them onto the California FAIR Plan, the state’s insurer of last resort, which offers limited but costly policies.
A Times analysis found that that in the Palisades and Eaton fire zones, the FAIR Plan’s rolls from 2020 to 2024 nearly doubled from 14,272 to 28,440. Mandating coverage has been seen as a way of reducing FAIR Plan enrollment.
“I’m disappointed this bill died in committee. Fire survivors deserved better,” Pérez said in a statement .
Also failing Monday in the committee was SB 982, a bill authored by Sen. Scott Wiener, (D-San Francisco). It would have authorized California’s attorney general to sue fossil fuel companies to recover losses from climate-induced disasters. It was opposed by the oil and gas industry.
Passing the committee were two other Pérez bills. SB 877 requires insurers to provide more transparency in the claims process. SB 878 imposes a penalty on insurers who don’t make claims payments on time.
Another bill, SB 1301, authored by insurance commissioner candidate Sen. Ben Allen, (D-Pacific Palisades), also passed. It protects policyholders from unexplained and abrupt policy non-renewals.
Business
How We Cover the White House Correspondents’ Dinner
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Politicians in Washington and the reporters who cover them have an often adversarial relationship.
But on the last Saturday in April, they gather for an irreverent celebration of press freedom and the First Amendment at the Washington Hilton Hotel: The White House Correspondents’ Association dinner.
Hosted by the association, an organization that helps ensure access for media outlets covering the presidency, the dinner attracts Hollywood stars; politicians from both parties; and representatives of more than 100 networks, newspapers, magazines and wire services.
While The Times will have two reporters in the ballroom covering the event, the company no longer buys seats at the party, said Richard W. Stevenson, the Washington bureau chief. The decision goes back almost two decades; the last dinner The Times attended as an organization was in 2007.
“We made a judgment back then that the event had become too celebrity-focused and was undercutting our need to demonstrate to readers that we always seek to maintain a proper distance from the people we cover, many of whom attend as guests,” he said.
It’s a decision, he added, that “we have stuck by through both Republican and Democratic administrations, although we support the work of the White House Correspondents’ Association.”
Susan Wessling, The Times’s Standards editor, said the policy is a product of the organization’s desire to maintain editorial independence.
“We don’t want to leave readers with any questions about our independence and credibility by seeming to be overly friendly with people whose words and actions we need to report on,” she said.
The celebrity mentalist Oz Pearlman is headlining the evening, in lieu of the usual comedy set by the likes of Stephen Colbert and Hasan Minhaj, but all eyes will be on President Trump, who will make his first appearance at the dinner as president.
Mr. Trump has boycotted the event since 2011, when he was the butt of punchlines delivered by President Barack Obama and the talk show host Seth Meyers mocking his hair, his reality TV show and his preoccupation with the “birther” movement.
Last month, though, Mr. Trump, who has a contentious relationship with the media, announced his intention to attend this year’s dinner, where he will speak to a room full of the same reporters he often derides as “enemies of the people.”
Times reporters will be there to document the highs, the lows and the reactions in the room. A reporter for the Styles desk has also been assigned to cover the robust roster of after-parties around Washington.
Some off-duty reporters from The Times will also be present at this late-night circuit, though everyone remains cognizant of their roles, said Patrick Healy, The Times’s assistant managing editor for Standards and Trust.
“If they’re reporting, there’s a notebook or recorder out as usual,” he said. “If they’re not, they’re pros who know they’re always identifiable as Times journalists.”
For most of The Times’s reporters and editors, though, the evening will be experienced from home.
“The rest of us will be able to follow the coverage,” Mr. Stevenson said, “without having to don our tuxes or gowns.”
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