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Tesla CEO Elon Musk quashes claim he is 'modern-day robber baron'

Jonathan Garber

Tesla Inc. CEO Elon Musk fired back at former Labor Secretary Robert Reich who accused him of being a “modern-day robber baron” after his net worth soared by billions while company employees were forced to take a pay cut amid the COVID-19 pandemic.

The Palo Alto, Calif.-based electric-car maker’s soaring stock price boosted Musk’s net worth to more than $100 billion, up from about $25 billion, while also boosting workers’ wealth.

“All Tesla workers also get stock, so their compensation increased proportionately,” Musk tweeted. “You are a modern day moron.”

Tesla’s was ordered to close its Freemont, Calif. plant on Mar. 17 in order to help slow the spread of COVID-19. The facility remained closed until May 13 when the company defied county orders to remain shuttered.

To help cushion the blow from lost business, the company reduced employee pay by 10% to 30% from April 7 through June 29. During that time, Tesla shares had soared by 96%.

Shares continued higher before topping out on Aug. 31, the same day a 5-for-1 stock split was implemented. The stock had gained 496% this year at its peak and had given the company a market capitalization of $464 billion, making Tesla the sixth-largest among publicly traded U.S. companies.

Heavy selling over the next five sessions pushed shares by as much as 33% as investors digested news the company was planning to sell up to $5 billion of new shares and that the electric-car maker was bypassed for inclusion in the S&P 500.

Shareholders also had to grapple with the news that Edinburgh-based investment manager Baillie Gifford, the company’s largest outside shareholder, was reducing its stake to less than 5% in order to meet concentration guidelines.

Tesla shares were up 295% this year through Tuesday.

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