Elon Musk’s appearance on The Joe Rogan Experience podcast last year had a financial toll not just on the companies the Tesla CEO heads but also on the US taxpayer.
According to Politico, the publicly-funded National Aeronautics and Space Administration (NASA) was so concerned about Musk’s pot-smoking incident that it ordered a mandatory review of the workplace culture of the billionaire’s space firm SpaceX. To cover the cost of the review, NASA agreed in May to pay SpaceX approximately $5 million.
Besides a workplace culture review, a program was instituted at SpaceX to educate employees and ensure federal contractors follow strict guidelines on substance abuse. Serving as a federal contractor is conditioned on having a drug-free workplace per Title 41, Section 8102 of the US Code of Laws.
During the podcast, Musk was offered a ‘blunt’ by the host Joe Rogan and went on to take a puff. Watch the video below of the recording at the 2:10:33 mark.
Since the podcast was recorded in California, where both medical and recreational marijuana is legal, Musk was not deemed to have committed a crime. However, under federal law the consumption of marijuana is still prohibited.
While it had not previously been publicly known that the cost of the workplace culture review at SpaceX was being borne by U.S. taxpayers, NASA mandated the exercise just weeks after Musk’s cannabis-puffing incident.
The ‘cultural assessment study’ was not restricted to SpaceX though but also roped in Boeing. At the time NASA said the review was meant to ensure that the two federal contractors were meeting workplace safety requirements and were adhering to a ‘drug-free environment’.
Elon Musk’s behavior on the podcast was also criticized by NASA’s administrator, Jim Bridenstine:
I will tell you that [smoking a blunt] was not helpful, and that did not inspire confidence…
The administrator also warned that similar behavior by the Tesla CEO could jeopardize SpaceX’s prospects as a federal contractor. Bridenstine also disclosed that he had talked to Musk and promised ‘you won’t be seeing that again’.
While it is the US taxpayers who are now just learning they are footing the bill for the workplace review at SpaceX, Tesla investors bore immediate impact. After the incident which occurred on the evening of September 6th 2018, the electric car firm’s shares fell by over 10% the following day to record a monthly low. The stock, however, went on to recover from the September low. By early December the stock had appreciated by about 50%.
Currently, the Tesla stock is below the $260 level, down 27% from the 2019 high recorded in January. This has been blamed on a variety of factors including Elon Musk’s overly optimistic forecasts.
Last modified: September 23, 2020 1:09 PM