Stargate: Elon Calls Out Trump's $500B AI Plan
Is Stargate's goal realistic?
Elon Musk just threw cold water on one the biggest announcements of Trump’s new administration. Let’s unpack what happened.
The $500 Billion Stargate Project
On Tuesday, President Trump unveiled Stargate, a $500 billion initiative to build AI infrastructure in the U.S.—primarily massive data centers equipped with cutting-edge supercomputers.
The ambitious project is designed to maintain America’s leading position in artificial intelligence, but its eye-popping price tag has raised eyebrows.
Standing alongside Trump during the announcement were three tech heavyweights: Oracle founder Larry Ellison, SoftBank boss Masayoshi Son, and OpenAI CEO Sam Altman. These companies, along with MGX—an Abu Dhabi-based investment firm—are supposed to provide the initial funding for Stargate.
But here’s the problem: even though these companies are big names, they may not have anything close to the kind of money they’re claiming to have.
After OpenAI tweeted about their involvement in Stargate, Elon Musk jumped into the conversation. He asserted that the Stargate collaborators actually don’t have the necessary funds.
In fact, according to Elon, they’ve secured well under $10 billion—a far cry from the $125 billion per year they’ve pledged to invest.
Elon isn’t the only one casting doubt. Tech investor Gavin Baker called the $500 billion figure “ridiculous” and said, “no one should take it seriously.”
His post on X broke it down like this: SoftBank has $38 billion in cash right now; Oracle has $11 billion; MGX might have $10 billion; and OpenAI has none (they’re burning through their cash to build their AI models and apps like ChatGPT).
That’s “nowhere close to $500 billion,” he said, while adding that the group “might be able to put together $50 [billion] in equity funding over several years.”
The Altman vs. Musk Showdown
In addition to Elon and Gavin, many others on X expressed skepticism about how big the Stargate project will really be.
But Open AI CEO Sam Altman didn’t let those comments go unanswered. He fired back at one of Elon’s tweets, calling Musk’s claims wrong while defending Stargate as “great for the country.”
Then, he went for the jugular, as you can see from the Tweet below:
Ouch. That’s a pretty pointed jab, and it’s clear there’s some bad blood between these two. Remember, Elon and Sam were both among the 11 founders of OpenAI, but Elon left in early 2018 after an internal power struggle.
Then in 2023, Musk launched xAI, a direct competitor to OpenAI. And in 2024, he even sued his former company, accusing it of abandoning its nonprofit mission and prioritizing profits.
So, there's definitely some history between Elon and Sam, and it might be influencing how these two AI heavyweights view each other’s moves.
Skeptical but Hopeful
Beef aside, when it comes to the Stargate venture, I’m with Elon: I’m skeptical that they will be able to invest $500 billion over four years like they say they will.
That said, I’m keeping an open mind. Maybe SoftBank’s Masayoshi Son will be able to raise huge sums of money from outside investors like he did for his $100 billion Vision Fund several years ago. Altman also has a reputation for being a great salesman and fundraiser, so maybe the two can pull off something extraordinary together.
Whether or not Stargate achieves its ambitious goals, the effort itself is commendable. I applaud the Trump administration and the companies involved—OpenAI, Oracle, SoftBank, and MGX—for uniting to pursue such a bold vision. This kind of initiative is exactly what’s needed to ensure America remains a global leader in AI innovation.
And regardless of what happens with this particular project, one thing is certain: AI investment will continue to boom.
America’s biggest tech companies, including Google, Microsoft, Amazon, Meta, and Oracle, are expected to spend a combined $311 billion on capital expenditures this year—up from $253 billion last year. Much of this spending will go toward AI infrastructure.
So, while Stargate’s $500 billion target might be a stretch, there’s no denying that hundreds of billions of dollars will be invested in AI in the coming years.