AI Cold War: Why Musk’s White House Breakup Could Reshape America’s AI Race

The AI Showdown Heating Up Washington

On May 30, 2025, Elon Musk’s brief stint in Washington ended with a symbolic farewell, marking the collapse of a short-lived alliance with President Trump. The split came as little surprise. In February, Platocom reported in The Battle for OpenAI, tensions had been simmering since Trump’s second day in office, when he welcomed OpenAI (Chat GPT) CEO Sam Altman to the White House to unveil the $500 billion Stargate AI infrastructure initiative. Altman stood beside the president as the administration laid out its national AI vision. Despite co-founding OpenAI and launching a rival firm, xAI, Musk was noticeably excluded from the Stargate Project.

NEWS UPDATE JUNE 6 AT 3:30 PM

Source: The Wall Street Journal

Elon Musk’s feud with President Trump is now threatening a critical $5 billion debt deal for xAI, his artificial intelligence venture. As bankers at Morgan Stanley tried to pitch Wall Street on funding xAI’s data centers, investors were distracted by Musk’s public attacks on Trump. The timing couldn’t be worse:

"xAI needs massive capital to expand Grok, its AI chatbot, and build the infrastructure to compete with OpenAI’s Stargate. Now, with Tesla’s stock dipping and Trump threatening to cut federal contracts, the political fallout is casting a long shadow over Musk’s AI ambitions."

Now back to the story:

Musk Excluded From Stargate From the Get-Go

Why wasn’t Musk included in Stargate? We don’t know. What we do know is this: America’s power grid is already strained, and Stargate’s proposed scale only raises more urgent questions—not just about electricity demand, but about who gets to shape the digital future. If Musk wants to reassert relevance and help secure America's future, perhaps the real opportunity lies not in lobbing insults, but in helping solve the energy challenge AI now poses.

Sam Altman during a January press conference when Trump announced Stargate without Elon Musk.

The Stargate Project, officially announced on January 21, 2025 by President Donald Trump, is a joint venture between OpenAI, SoftBank, Oracle, and investment firm MGX. The project aims to invest up to $500 billion in AI infrastructure within the United States by 2029. The venture's chairman is SoftBank's CEO Masayoshi Son. Elon Musk was never included.

Platocom’s Take: It Was Always About Power—Electric and Political

This drama isn’t just another D.C. feud—it’s the front line of a much bigger war: who controls the future of AI infrastructure, and whether the U.S. electric grid can survive it. With data centers consuming more energy than mid-sized cities and AI workloads escalating, Platocom has repeatedly written about this one fact: without a federal framework, the grid will crack under pressure. Now, this power struggle—literal and figurative—has a new main character: Sam Altman.

Billionaire Showdown in Saudi Arabia: Musk’s Power Play Threatened Trump’s AI Mega-Deal

In May, President Trump traveled to Saudi Arabia to secure foreign investment for Stargate—a $500 billion initiative to build the next generation of AI-powered data centers across the U.S. Elon Musk also appeared on the trip, but his involvement was marked more by tension and controversy than collaboration.

According to the Wall Street Journal, Musk warned Saudi officials that President Trump would withhold endorsement of the Stargate initiative unless Musk’s company, xAI, was included. This move put Musk at odds with both the White House’s diplomatic efforts and OpenAI CEO Sam Altman’s push to secure Middle Eastern funding. Musk’s attempt to insert himself into the deal risked undermining a critical presidential foreign policy objective.

Musk had learned just before Trump’s mid-May tour of three Gulf countries that OpenAI Chief Executive Sam Altman was going to be on the trip and that a deal in the U.A.E. was in the works, and grew angry about it, according to White House officials. He then said he would also join the trip, and appeared alongside the president in Saudi Arabia. 

Behind the scenes, Musk even lobbied Saudi officials to reconsider their support for Stargate, directly contradicting the administration’s strategy. Given that Saudi sovereign wealth funds play a vital role in funding U.S. data infrastructure projects, Musk’s actions could have jeopardized essential diplomatic and financial relationships at a moment when the U.S. power grid is already under strain from growing AI and cloud infrastructure demands.

What may have been a personal power play ultimately risked Musk’s standing among key allies, undermining the unity needed to develop a cohesive national AI infrastructure strategy.

Photos (from left) by Nathan Howard/Pool via AP ; Allison Robbert/Pool via AP File; Sean Simmers/The Patriot-News via AP

The Real Crisis: The Grid Can’t Handle This

Platocom’s position remains unchanged: The U.S. electric grid is not ready for the scale of data infrastructure both Altman and Musk envision. While billionaires posture and politick, utilities are buckling under existing demand, and AI has barely begun to peak. Whether Musk gains control of OpenAI or Altman’s Stargate is greenlit, we’re entering a high-voltage arms race, with no national regulation in place.

Conclusion: Chaos Is the Point

Musk leaves Washington with drama, bruises, and unfinished business. Altman, for now, seems to have the political momentum. In stark contrast to visionary billionaires such as Bill Gates, neither has offered a viable plan to ensure the power behind their machines comes from clean, reliable sources, or that host communities share in the gains.

Until then, the AI future will remain defined by private ambition, public risk, and infrastructure stretched to the brink.