The billionaire dug himself into a hole with the Boring Company.
In late 2016, billionaire Elon Musk was sitting in traffic on West Los Angeles’s notoriously clogged 405 freeway while shuttling between one of his Bel Air mansions and SpaceX’s headquarters in nearby Hawthorne. Fed up with “soul-destroying traffic,” he initially suggested adding another layer to the 405 before tweeting out an even more far-fetched idea: a 3D network of tunnels.
The idea is even more complicated than it sounds: Teslas would drive from the street onto elevator platforms called car “skates,” be lowered to tunnels below ground, and be propelled autonomously at 120 to 150 miles per hour to their destinations, while their passengers relaxed. Thus was launched the Boring Company.
Musk’s new company bought a machine and started boring a tunnel under Hawthorne. An opening party for the test tunnel in late 2018 received mixed reviews. The path was bumpy; the cars did not drive themselves, and they never went faster than 40 miles an hour.
In the years since, the company built a 1.7-mile-long tunnel under the Las Vegas convention center, in which passengers are ferried back and forth in human-driven Teslas. Proposed projects in Los Angeles, Chicago, and Baltimore were scrapped. But that hasn’t stopped cities large and small, in California, Kentucky, Texas, Florida, and elsewhere, from expressing interest in building tunnels for cars. But as Curbed’s Alissa Walker explains on Today, Explained, the company is continually ghosting these cities once they bump into permitting issues or other infrastructural complexities.
Below is an excerpt of the conversation, edited for length and clarity. There’s much more in the full podcast, so listen to Today, Explained wherever you get podcasts, including Apple Podcasts, Google Podcasts, Spotify, and Stitcher.
Noel King
When does this idea become real?
Alissa Walker
He did actually buy a tunnel-boring machine. It was a second-hand machine that was used to dig sewer tunnels in Northern California. And he starts digging in the SpaceX property, which is, you know, right near LAX, in a different city, though, named Hawthorne. And he creates this whole culture around this new company that he names the Boring Company.
Noel King
So he gets a digging machine, which I’m imagining, tell me if I’m wrong — Do you remember the movie Tremors?
Alissa Walker
I do. I do.
Noel King
Okay. Is it like the monster from Tremors? It’s just, like, big and round, and it pushes through the earth?
Alissa Walker
Yeah, it chews through the ground. And that’s exactly right. You have to dig a big hole, you kind of drop it down into the ground. Then it uses these, like, large metal teeth to chew through the substrate.
Noel King
Okay. So he gets his Tremors monster. And then there is another step required here, which is convincing people, elected officials in various parts of the country, to let him dig with it. How does he go about doing that?
Alissa Walker
At the beginning, he’s just in the city of Hawthorne, which is this very small city. It does a lot of work with these aerospace companies that have always been there. So they’re probably excited about it. They see this as a way of supporting innovation. They sign off. It’s just under the SpaceX property. That’s not a problem. But then it goes under the city, and you see this just really tremendous excitement from LA elected officials. The council members actually grant him an environmental review exemption to be able to do a test dig within the city of LA area. And then you see the mayor of Los Angeles, Eric Garcetti, posts some tweets about how supportive he is of the project.
Then you start to see all this interest from other cities, representatives who do these types of projects in other cities, are coming to this test digging site, and trying to figure out like, well, what’s he doing here? Maybe we can get in on this. We need tunnels, we have traffic, you know, where do we sign up?
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Ethan Miller/Getty Images
Noel King
So he begins in Los Angeles, and as you’ve said, it’s a great opportunity to dig a tunnel and make something happen. Does he and his digger, do they make a bunch of really awesome tunnels really quickly?
Alissa Walker
That’s the one thing I think is still up for debate. I mean, the big claim from the Boring Company was that they’d be able to dig faster, more efficiently, and cheaper than the way that cities were already doing it. And it’s not clear yet if they’re able to introduce any type of innovation to the tunnel boring process. But the bigger problem is these challenges that come from political, legal, environmental obstacles. And that’s what Musk himself started to run up against.
What happened in LA was kind of what happens to a lot of these projects. A group of neighbors who live on the west side, near that 405 freeway that is perpetually clogged with traffic, sued to stop it. It’s a very wealthy group of neighbors who were worried about the idea of somebody tunneling under their properties. But I will say also, there were a lot of local groups that just said, “Hey, this isn’t actually going to stop traffic.” This isn’t the way we fix this. We actually need to think about a better solution that’s going to be available to more people. And it was never very clear about who was going to be able to use the tunnels and what kind of vehicle was going to travel in them and how fast you were going. All these numbers changed all the time. And when it came down to actually pinning down what would be going on in there, and when they had the debut of this test tunnel at the end of 2018, it was actually just a regular Tesla driving through a paved tunnel.
Noel King
All right. So in Los Angeles, things get hung up with a lawsuit, but other cities do get on board?
Alissa Walker
Yeah, their first paying customer came along, and it might not surprise you that it was Las Vegas. They were planning a large expansion to their convention center and decided that they needed some kind of transportation system to get people from one side to another. And the Boring Company comes along and says, hey, we can build you one of these systems that goes underneath the convention center. It’s less than two miles long from one end to the other. So they underbid significantly compared to other proposals, they get the job, and they get to work, starting with their first paying customer for about $50 million. Then the Boring Company proposed this giant 30-mile system that’s going all over Vegas, and that is actually starting to be dug. You can actually ride from the convention center under the strip and you can pop up in a casino across the street now.
Noel King
Las Vegas is a place where it actually happened! But Elon Musk is also trying to convince other cities. Where did it not work?
Alissa Walker
Elon Musk had gone to Chicago and met with Mayor Rahm Emanuel at the time and was proposing a tunnel that would go from the downtown area to O’Hare Airport. They were saying it was going to cost up to a billion dollars and that the Boring Company would pay for all of it. In December of 2018, with the opening of the test tunnel, we had these alderpeople from Chicago come to the opening, and their reviews weren’t so good. One of them said, “It was a little bumpy. There have to be more questions answered before we can begin a type of project like that.” And one of them even said, “If you look at Elon Musk’s career, he comes off as a grifter.” So when Lori Lightfoot was elected mayor after Rahm Emanuel left office, she actually killed the tunnel immediately.
You have a place like Maryland where Governor Larry Hogan recorded this video of him standing in this field with a chain link fence around him with the sign that says the Boring Company, saying that he thinks they’re going to come build a tunnel from Baltimore to DC.
You have officials from Florida, the mayor of Miami and the mayor of Fort Lauderdale, basically replying to Musk on Twitter saying, “Oh, we need tunnels, we have bad traffic. Why don’t you come bring some of that here?” And they are actually moving forward on a project in Fort Lauderdale that would be tunneling from the downtown area to the beach.
And then you also have a situation like we had in the Inland Empire here outside of LA with the Ontario Airport, where they weren’t even talking about tunnels. And somebody from the Boring Company came to them and said, “Oh, we can help you build a tunnel transportation system that gets from the airport terminal to the local commuter rail station.” And it’s something they’re actually continuing to pursue, even though the Boring Company completely bailed on them.
You also have what they’re doing in Texas, which is where they relocated the Boring Company headquarters to, outside of Austin. And they are basically going to cities of every size in Texas and really soliciting tunnels, saying like, “How can we solve your tunneling problems? We want to propose tunnels for all of your tunneling needs.”
We also have situations like where there’s a candidate for governor in Kentucky who is just proposing that he wants to build Boring Company tunnels under the ground throughout the state. They now have people taking this idea and saying they want to be part of it and saying they want these tunnels for cars underneath their cities just because they seem to think that this is going to solve some kind of traffic problem.
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Ethan Miller/Getty Images
Noel King
Is Wall Street interested in the Boring Company? Is it getting investment?
Alissa Walker
The Boring Company has gotten a huge round of investment. Just this year, in fact, Sequoia Capital, which is one of the biggest VC investors, they’re pouring a lot of money into it, and a bunch of real estate developers that maybe want to integrate it into their new developments. And so it now has a valuation of $5.5 billion, if you can believe it.
Noel King
You know, Alissa, I can’t help but think of a particular Simpsons episode. Do you know where I’m going with this?
Alissa Walker
I do. This comes up a lot. Any time I tell people about what I’m reporting on and the long saga of the Boring Company and Elon Musk going from town to town trying to sell his tunnels, the monorail episode, “Marge versus the Monorail,” comes up. It was written by Conan O’Brien, and it’s actually a riff on the very famous musical The Music Man, where Lyle Lanley comes to Springfield and tries to sell them a monorail. They have this windfall of cash, and they decide they’re going to invest in this monorail, even though they’re not sure if it is going to solve their transportation problems. And meanwhile, they’re driving home from the meeting where Lyle Lanley has done a literal song and dance to sell the idea through. And their car is like retching over these potholes, and Marge is like, “But what about Main Street?” And then they’re like, “No, you know, the monorail is going to be better, don’t worry.”
I rewatched it many times in reporting my stories because the parallels are really quite eerily similar. And what’s so funny about everybody referencing this monorail episode of The Simpsons is that the way that the Boring Company can build its system in Vegas is that it has to be called a monorail. So on all the documents it says, like, “The Boring Company is now operating a monorail.”
A leaked memo shows Amazon was concerned with attracting and retaining top engineers earlier this year.
Amazon has long been one of the top employers in the tech industry. Online shopping was consistently growing, and Amazon’s two main profit engines, cloud services and advertising, were growing even faster. If you took a white-collar job at Amazon, whether you stayed there two years or 10, your career seemed to be set. Until last month.
In late November, Amazon began making what are expected to be the largest corporate staff cuts in its 28-year history, axing as many as 10,000 corporate employees, or about 3 percent of the company’s office staff. Rumors continue to spread internally that the number of job cuts might grow, either through traditional layoffs or by pushing out more employees than usual for unsatisfactory performance, with one publication reporting that 20,000 cuts are the actual target. And Amazon began quietly rescinding job offers to future employees as well. This is upending the lives of would-be staff and threatening the company’s reputation in the job market for technical talent — where it was already facing challenges, according to a leaked internal memo exclusively viewed by Recode.
A company spokesperson confirmed that job offers were pulled, which was first reported by The Information, but declined to disclose specific numbers. Even without knowing exactly how many offers the company has rescinded, current and future Amazon employees alike are shocked — underscoring the rarity of the current cost-cutting climate at the tech giant and raising the question of what these pullbacks signal for the economy as a whole. Inside the company, some employees are questioning whether Amazon will still prioritize pursuing big ideas that don’t generate immediate financial payoff. Crucially, much of Amazon’s success can be attributed to investing in projects that weren’t profitable in the short run but which, with Wall Street’s backing, allowed the company to increase its market share and power in a given sector by focusing instead on growth.
“The question among employees is, ‘Does this mean we should only be on teams that add revenue or that we think are ‘the most safe’?” an Amazon senior manager of more than 10 years told Recode. “That’s very damaging to the ‘Think Big’ and ‘Invent and Simplify’ ethos of this company.” (Those are two of the 16 leadership principles that are supposed to guide how work gets done inside Amazon.)
Yet the problem with looking for deeper meaning in Amazon’s recent moves — beyond what we already know about its leaders being leery about the future of the economy and that they bet that a pandemic-fueled e-commerce boom would continue longer than it did — was that Amazon has been in a league of its own as a hiring machine. Between 2019 and 2021, Amazon doubled its employee count, adding 800,000 employees in just two years, including warehouse employees. Amazon now also has more than 300,000 tech and corporate employees across the globe.
“No company had hired like Amazon had in the previous decade,” said Amazon’s former head of communications, Craig Berman, who left the company in 2018 after 14 years. “And so I hesitate to even start to guess at what this could mean because there is nothing historical to base the reaction on.”
As a result, the bewilderment felt by employees and would-be future employees in the wake of the layoffs and job rescissions is understandable, Berman said, especially since the company has not had major job cuts in more than 20 years and largely kept its foot on the gas even during the Great Recession of 2007 to 2009.
“They seemed immune,” Berman said.
Amazon’s new reality has been a harsh wake-up call for would-be employees. Several told Recode they were counting on the job to remain in, or reenter, the US on a work visa and were distraught over needing to find new employment in a short period of time. One employee who had their job offer pulled in late November had just received it in September, with a start date planned for January. Another employee who was slated to start working in a high-paying technical role in the retail division in January was offered a job in October only to have it pulled back the next month.
“I think the worst part for Amazon is the damage they’ve done to their reputation,” this person told Recode.
The employee said they mainly chose Amazon over offers from rival companies because the Seattle-based tech giant was offering a significantly higher pay package. If the financials had been more equal, they said, they would have likely chosen a competitor with a better reputation for work-life balance.
While Amazon had long remained a stable corporate hirer that kept adding new, lucrative roles every year — especially as its stock price rose consistently for much of the past decade — it also developed a reputation among some staff as a sometimes brutal and cutthroat workplace, and one where some employees from underrepresented backgrounds felt discriminated against or worse. Earlier this year, Insider reported that high-performing employees were leaving Amazon corporate divisions at double the normal rate. And according to an internal Amazon memo from June that Recode reviewed, perception of the company’s corporate culture already seemed to be having a negative impact on recruiting even before this cycle of layoffs and pulled offers began.
The internal memo cited a LinkedIn survey of more than 7,000 software developers who weren’t working for Amazon at the time. Among a set of 25 top tech competitors, Amazon only ranked 19th for “good work-life balance,” while it came in 10th for “flexible work arrangements” and 11th for “ongoing employee training & development.” These rankings, the memo stated, were hurting recruiting, with 40 percent fewer job seekers applying for software development jobs at Amazon in May than in January.
Those preexisting recruitment issues could now be exacerbated by the tech giant slashing roles and rescinding job offers. Amazon seems aware of this and is attempting damage control: For those who have had an Amazon job offer reversed, the company will pay them a month’s worth of the base pay they were set to make.
“It’s going to have an impact on your employer brand,” Tom Wilson, president of the HR executive search firm Frederickson Partners, said of companies that rescind job offers.
But whether the one-month payment is enough to fortify the company’s reputation as a top employer is an open question.
Despite offering buyouts to at least hundreds of its recruiters, Amazon expects to hire in some growing areas in 2023, such as Amazon Web Services, even as it retrenches in others like Alexa and its core retail business. After all, if it wants to compete for top tech talent as it pursues ambitions in other industries ranging from e-commerce to video streaming to cloud computing to advertising, it needs to improve its reputation. While 10,000 job cuts only represent approximately 3 percent of all its corporate roles, this is a shift that’s foreign to most employees at Amazon and those who once saw the company as their dream employer.
It’s the GOP’s latest attempt to undo such policies.
This year, Congress’s annual defense bill, a must-pass measure that authorizes military spending for the next year, includes a unique provision.
The legislation, known as the National Defense Authorization Act (NDAA), lays out more than $840 billion in defense funds and would roll back the military’s Covid-19 vaccine mandate. That mandate, put in place in August 2021 to prevent the spread of coronavirus among service members, is opposed by Republicans, who’ve long railed against vaccine mandates in general. Now the GOP is using the NDAA to seize a win on something they’ve made into a culture war issue.
Republicans’ main argument centers on staffing: They say the military’s Covid-19 vaccine mandate has pushed out thousands of service members in a time when there are already severe labor shortages. Roughly 8,000 active-duty service members have been discharged because they refused vaccination, per US News, but that represents a small fraction of the military’s more than 1 million active-duty service members. As Politico reported, about 98 percent of the military has been vaccinated.
Because the NDAA needs at least 10 Republican votes to pass in the Senate, and will probably need House Republican support given Democrats’ narrow majority in that chamber, the GOP has a key opportunity to secure a policy and messaging win on vaccine requirements. Republican efforts hint, too, at how they’ll continue to leverage Democrats’ need for their cooperation in the new term, when they’ll control the House and the Democrats the Senate.
“That’s the first victory of having a Republican majority, and we’d like to have more of those victories, and we should start moving those now,” House Minority Leader Kevin McCarthy said on Fox News this past weekend, regarding the vaccine mandate rollback.
Why Republicans pushed to overturn the vaccine mandate
The Biden administration, including Defense Secretary Lloyd Austin, has opposed putting the repeal of the vaccine mandate in the NDAA, though it’s stopped short of saying the president won’t sign it if it contains this provision. “A million people died in the United States of America. We lost hundreds in DOD. So this mandate has kept people healthy,” Austin told reporters this past weekend. Additionally, the White House has noted the military has long had mandates for other vaccines including the flu and a host of other illnesses.
In recent weeks, however, Republicans have made repealing the Covid-19 vaccine mandate a chief priority, claiming that it’s impacted the military’s ability to staff itself. The NDAA represented a prime chance to make a point on this issue, which has been politicized over the past few years, with Republicans arguing mandates represent an un-American assault on personal freedom. As Covid-19 cases have declined across the country, Republican lawmakers have only argued more vocally that there’s less of a need for these requirements.
Republicans’ main grievance is that the vaccine mandate has made it tougher for the military to retain people and recruit new service members, a claim that isn’t backed up by “hard data,” according to Austin. The reasons for recruitment shortfalls are nuanced: As the Associated Press reported, the Army did miss its recruitment target by 25 percent in the last year, with military leaders attributing the gap to a number of factors, including inability to do in-person recruiting because of the pandemic as well as vaccine hesitancy. Marine Corps Commandant Gen. David Berger, a top military leader, has said vaccine mandates pose some obstacles in recruiting due to misinformation about the Covid-19 shots.
Along with the rescinding of the mandate, Republicans have called for a provision that would reinstate service members who’ve been discharged in the past because of the vaccine mandate, though that has not made it into the bill.
The push against the military vaccine mandate marks the latest effort by the GOP to make vaccine mandates an issue of contention in different must-pass bills. Republicans have repeatedly threatened to hold up government funding unless they could vote on amendments that would defund vaccine mandates the Biden administration has put in place for federal employees and medical workers. Since those mandates were established, GOP lawmakers have frequently tapped into the issue as a way to show their base that they’re protecting people’s liberties.
“It’s an honor to fight for our servicemembers and ensure they are protected from Biden’s COVID vaccine mandate,” Sen. Marsha Blackburn (R-TN) tweeted.
The White House, on the other hand, has criticized Congress’s decision to rescind the vaccine mandate, saying immunizations remain important for maintaining troops’ ability to serve whenever and wherever necessary. “Vaccines are saving lives, including our men and women in uniform. So this remains very, very much a health and readiness issue for the force,” National Security Council spokesperson John Kirby said Monday, per the New York Times.
Republicans want to use these bills to score political points
McCarthy has signaled that Republicans are eager to use legislation like the defense bill to make their case on cultural issues once they assume the House majority in January. He even urged Congress to delay the passage of the defense bill until next year so they could include more provisions that combat the “woke-ism” that he argued Democrats are supporting. Although McCarthy did not specify which policies he was interested in targeting, Politico has reported that this umbrella could include things like initiatives aimed at making the military more diverse.
Republicans’ pushback on this issue indicates how they may use House control next year in a split Congress to secure their priorities on everything from defense policy to appropriations to the debt ceiling. Because several must-pass bills will need House support to advance, the GOP will have multiple opportunities to use their leverage to lobby for provisions like this one. The House is expected to pass the NDAA with the inclusion of the vaccine mandate rollback this week, a move Republicans have described as just the beginning.
“[I]n 28 days, the real work begins,” McCarthy said in a Tuesday statement. “The new House Republican majority will work to finally hold the Biden administration accountable and assist the men and women in uniform who were unfairly targeted by this administration.”