October 26, 2026 09:00 AM PST
(PenniesToSave.com) – Former Clinton Labor Secretary Robert Reich wants Democrats to set their sights on one of the most valuable companies in the country. Appearing on The Coffee Klatch podcast with host Heather Lofthouse, Reich said Democrats should defund Elon Musk and begin laying the groundwork to nationalize SpaceX and its Starlink satellite network [1]. Musk fired back on X [1].
The comments arrive at a tense moment for the company. In October, Ukrainian President Volodymyr Zelenskyy said restrictions on Starlink and its military counterpart, Starshield, were keeping his forces from using the systems to intercept certain Russian drones, and The Wall Street Journal later reported that Musk personally ordered a slowdown of the military-grade service [2][3].
The stakes reach well beyond a political feud. SpaceX debuted on the Nasdaq in June with a record-breaking initial public offering and has since grown to a market value of roughly $2 trillion, according to Moneywise [2]. That turns talk of a government takeover into a question about private property, taxpayer dollars, and the savings of ordinary shareholders. For anyone learning how investing in individual stocks works, the debate is a reminder that political risk can reach a portfolio quickly.
Quick Links
- What Did Robert Reich Propose, and How Did Musk Respond?
- Why Are Calls to Nationalize SpaceX Resurfacing Now?
- How Much Does Washington Depend on SpaceX?
- Who Else Has Floated a Government Takeover, and Why?
- Could the Government Legally Take Over SpaceX?
- What Could a Takeover Mean for Taxpayers, Investors, and Customers?
What Did Robert Reich Propose, and How Did Musk Respond?
Reich framed his call to defund Musk in dollars. He claimed that 75 percent of Musk’s wealth depends on taxpayers buying Starlink systems for the Department of Defense, though the published transcript does not show a source for that figure [1]. He argued that the response should go further than oversight hearings, saying a Democratic administration should prepare to nationalize Starlink and SpaceX and turn the business into a public corporation, because that kind of power should never rest in one private person’s hands [1].
“Nationalize it.”
Robert Reich, former U.S. Labor Secretary [1]
Reich also reached for history. He compared Musk to the robber barons of the first Gilded Age, called him Exhibit A in what he described as a billionaire takeover of America, and alleged that Musk is trying to buy a U.S. Senate seat in Texas, a claim he did not support with evidence during the interview [1]. He predicted that if Democrats win the House, and possibly the Senate, Musk will become a major focus of congressional attention, and that Musk will answer with litigation and his large following on X, which Reich estimated at 360 million before correcting himself to 260 million [1].
Musk’s reply was brief. He wrote that taking companies by force amounts to a serious crime and suggested Reich belonged in prison [1]. The exchange reflects a deeper disagreement over whether a company that earns money from government contracts should remain fully in private hands.
Why Are Calls to Nationalize SpaceX Resurfacing Now?
Zelenskyy told reporters that his country could not use Starlink or Starshield on its own territory to shoot down jet-powered Shahed drones, according to CBS News reporting cited by Moneywise [2][3]. He said Ukraine was told the restrictions stemmed from technical issues, even though the systems appeared to work normally across the European Union, and that efforts by Ukraine’s Defense Ministry to reach SpaceX went unanswered [2].
Secretary of State Marco Rubio offered a different picture. He said Starshield was not currently available to Ukraine and that its use was still under discussion, said the U.S. government was not responsible for the outage, and questioned whether Zelenskyy understood the situation [2].
The Wall Street Journal then reported that Musk personally ordered the slowdown of military-grade Starlink service on Oct. 14, limiting the speeds at which Ukrainian drones could hold a satellite connection and disrupting both offensive operations and interception efforts [2][3]. Musk later claimed the U.S. military, and ultimately the president, set the restrictions, while President Trump told reporters he did not know who was responsible [2]. Those four accounts do not fit together neatly, and the public record does not yet settle which one is complete.
The episode revived an argument heard before. Investigative journalist Lindsay Beyerstein argued on Bluesky that the military cannot function without SpaceX yet cannot trust it to serve the national interest, leaving nationalization as the only path [2]. Jacobin columnist Ben Burgis made a similar case in 2025, arguing that a space program sustained by public funding has no reason to stay private and that vital satellite internet should not answer to a single wealthy owner [6].
How Much Does Washington Depend on SpaceX?
Moneywise, citing regulatory filings and The New York Times, estimates that about 20 percent of SpaceX revenue now comes from U.S. government contracts, down from more than 80 percent in the early 2020s [2]. That figure measures something different from Reich’s claim about Musk’s personal wealth [1], and from writer Matt Stoller’s count of $22 billion in direct federal funding the company has received [7]. Each number comes from its own source, and none settles the question alone.
What is clearer is the scale of SpaceX’s role. Starlink had more than 11,000 satellites in low-earth orbit as of October [2], and Stoller wrote in 2025 that it accounted for about two-thirds of all satellites in space [7]. He also reported that SpaceX lifted 90 percent of all pounds sent to orbit in the last quarter of 2023 and provides the only vehicle carrying astronauts to and from the International Space Station [7].
The Pentagon’s contract record points the same way. In April 2025, the Space Force selected SpaceX for 28 of 54 planned national security launches in a contract worth up to $5.9 billion, while United Launch Alliance received 19 and Blue Origin received seven [2]. According to Air & Space Forces Magazine, SpaceX received most of the $660 million in orders under the Space Force’s Proliferated Low Earth Orbit program despite 20 approved vendors, and The Wall Street Journal reported that the company secured $4.2 billion for missile-tracking satellites under the Golden Dome program [2].
Rivals such as SES, Iridium, and Viasat exist, but none matches Starlink’s scale [2]. Supporters see that record as evidence of a company that keeps winning the business, while critics see a dependence that leaves the government with few alternatives.
Who Else Has Floated a Government Takeover, and Why?
Calls to take over SpaceX are not limited to the left. In June 2025, during Musk’s public falling out with President Trump, former White House strategist Steve Bannon said on his podcast that the government should seize the company, urging an executive order under the Defense Production Act, a Korean War-era law [8]. Accounts of what he wanted vary. Moneywise describes temporary government control [2], Stoller describes a takeover [7], and Futurism reported, citing Politico, that Bannon wanted SpaceX and Starlink placed under government management until investigations into Musk were complete, with trade adviser Peter Navarro carrying out the order [8]. Bannon had vowed months earlier to take Musk down, a personal feud that colors his proposal [8].
Stoller, who writes about monopoly power, endorsed Bannon’s argument and called for antitrust scrutiny [7]. He pointed to tactics that rivals allege SpaceX uses, including pricing launches below cost in some cases and inserting right of first refusal clauses into customer contracts [7]. Rocket Lab founder Peter Beck, a competitor, told The New York Times he believes SpaceX’s dominance reflects deliberate business decisions [7]. These remain allegations from competitors.
The 2025 feud also showed how much leverage is involved. Musk threatened to begin decommissioning the Dragon spacecraft, which would have cut off NASA’s access to space, before reportedly reversing course within hours [7][8].
A related debate has reached artificial intelligence. Palantir CEO Alex Karp told CNBC in September that leading AI labs may need to be nationalized because of liability risks, an argument about AI developers rather than SpaceX [4]. CNBC also reported that Musk has backed a push to slow frontier AI development [4].
Could the Government Legally Take Over SpaceX?
Even supporters acknowledge that a takeover would be complicated. The Defense Production Act gives Washington broad authority to direct private industry toward national defense, but it does not grant blanket authority to take ownership of a company, Moneywise reported [2]. A broader seizure would raise Fifth Amendment questions, since the Constitution requires just compensation when private property is taken for public use [2].
Brandon J. Weichert, senior national security editor at The National Interest, argues the courts have already drawn a line. He points to Youngstown Sheet & Tube Co. v. Sawyer, the 1952 Supreme Court case that he says ruled the federal government cannot simply take over a private business in the name of national security [9]. Weichert notes that the ruling came during the Korean War, when the need for steel was real, while the country today is nominally at peace [9]. In his view, the courts would tie up any attempt to act on Bannon’s suggestion [9].
Narrower options exist in theory. Moneywise noted that any plan would have to address shareholder compensation and whether Washington could acquire specific military assets rather than the entire company [2]. For now, there is no established plan to bring SpaceX under federal ownership [2].
The legal question is also a question of values. Protections against government seizure exist so that every owner, large or small, can trust that property will not be taken on political grounds. Those protections apply to unpopular owners just as much as popular ones.
What Could a Takeover Mean for Taxpayers, Investors, and Customers?
The price tag would fall on the public. Brian Wang of the tech newsletter NextBigFuture noted that acquiring SpaceX could carry an enormous cost for taxpayers given its valuation, which Moneywise puts at roughly $2 trillion [2]. Because the company is publicly traded, any takeover would also have to compensate its shareholders [2].
Investors have also faced risks tied to the IPO itself. Jacobin reported that the Securities and Exchange Commission granted broker-dealers temporary relief from a rule requiring them to keep customer cash reserves in a separate account, a safeguard meant to protect investors if a firm goes bankrupt [5]. The outlet said experts warned the change could put everyday investors’ assets, including 401(k)s and pensions, at risk if markets turn volatile [5]. Savers who want to understand those protections can review how 401(k)s and other retirement accounts work.
Weichert argues that SpaceX exists because the national security establishment could not perform key missions, and that its reusable rockets, an achievement he says NASA never reached on its own, slashed launch costs and made Starlink possible [9]. He adds that Starlink’s swarm of smaller satellites, along with the military Starshield constellation, gives the country redundancy that makes its satellite network harder for China and Russia to knock out [9].
“Leave SpaceX alone.”
Brandon J. Weichert, The National Interest [9]
Stoller sees it differently, crediting public funding and what rivals allege are anticompetitive tactics for part of the company’s success [7]. For households, Starlink offers broadband through a small dish almost anywhere on the planet, and Stoller claimed the FCC and Commerce Department redirected broadband subsidies toward the service [7].
Final Thoughts
The debate over SpaceX raises a fair concern. Voices on the left and right, from Reich to Bannon to Stoller, worry that critical launch and communications systems answer to one person whose decisions can shape a war [1][7][8]. The Starlink dispute over Ukraine, with four competing accounts of who decided on the slowdown, gives that concern real weight [2].
The case against a takeover is substantial, however. Seizing a publicly traded company would test constitutional limits on government power, could cost taxpayers a sum tied to a roughly $2 trillion valuation, and would leave the property of ordinary shareholders exposed to political winds [2][9]. It would also hand a proven innovator’s work to the same agencies that, by Weichert’s account, could not do the job themselves [9].
There is room between those positions. Reich himself paired nationalization with oversight hearings [1], and Stoller pointed to antitrust review as a remedy short of seizure [7]. Congressional scrutiny, competitive contracting, and enforcement of existing law can address concentrated power without taking anyone’s property.
For households, the practical step is simpler. Know what you own, understand how political risk can touch your holdings, and watch how Congress handles this question after the midterms.
Works Cited
[1] Hains, Tim. “Robert Reich: Democrats Should ‘Defund Musk,’ Start ‘Laying Groundwork to Nationalize Starlink and SpaceX.'” RealClearPolitics, 25 Oct. 2026. Yahoo News, www.yahoo.com/news/politics/articles/robert-reich-democrats-defund-musk-130000863.html.
[2] Bourgi, Sam. “‘We’ve Got to Nationalize SpaceX,’ Observers Say: Meanwhile, CEO Elon Musk Reportedly Ordered a Starlink Slowdown That Stymied Ukraine’s Drones.” Moneywise, 21 Oct. 2026, moneywise.com/news/top-stories/nationalize-spacex-national-security-russia-ukraine-war.
[3] Bourgi, Sam. “Calls for SpaceX Nationalization Grow as Elon Musk Reportedly Orders Starlink Slowdown That Stymied Ukraine’s Drones.” Moneywise, 20 Oct. 2026. Yahoo Finance, finance.yahoo.com/technology/articles/elon-musks-2-trillion-spacex-151000917.html.
[4] Subin, Samantha. “Leading AI Labs May Need to Be Nationalized Because Risks Are So High, Palantir’s Karp Tells CNBC.” CNBC, 17 Sept. 2026, www.cnbc.com/2026/09/17/ai-safety-palantir-karp.html.
[5] Brewster, Freddy. “The SEC Is Radically Loosening Trading Rules for SpaceX.” Jacobin, 12 June 2026, jacobin.com/2026/06/musk-spacex-ipo-sec-regulation.
[6] Burgis, Ben. “We Should Immediately Nationalize SpaceX and Starlink.” Jacobin, 6 June 2025, jacobin.com/2025/06/musk-trump-nationalize-spacex-starlink.
[7] Stoller, Matt. “Steve Bannon: Nationalize SpaceX.” BIG by Matt Stoller, 6 June 2025, www.thebignewsletter.com/p/steve-bannon-nationalize-spacex.
[8] Tangermann, Victor. “Trump Advisor Calls on Trump to Nationalize SpaceX Immediately.” Futurism, 6 June 2025, futurism.com/steve-bannon-trump-seize-spacex.
[9] Weichert, Brandon J. “Nationalizing SpaceX Would Be Strategic Suicide.” The National Interest, 6 June 2025, nationalinterest.org/blog/buzz/nationalizing-spacex-would-be-strategic-suicide.