• Elon Musk said Reform UK's Nigel Farage "doesn't have what it takes" to be the party's leader.
• It comes after Farage disagreed with Musk's support for jailed far-right activist Tommy Robinson.
• Musk's comments came just hours after Farage called the Tesla CEO a "friend" in an interview.

Elon Musk appears to have turned on Reform UK's Nigel Farage, the leader of the country's right-wing party.

"The Reform Party needs a new leader. Farage doesn't have what it takes," Musk wrote on X on Sunday.

Musk has recently supported Reform UK as an alternative to the ruling Labour Party, primarily for its anti-immigration stance. Farage has welcomed that support and the two appeared to be forging a strong relationship. Farage recently visited Musk in the United States. And Musk was rumored to be lining up donations for Reform UK.

But things took a turn after Musk called for the release of Tommy Robinson, a jailed far-right anti-immigration activist. Speaking at a Reform UK event earlier this week, Farage said Robinson was "not what we need," The Telegraph reported.

"There are people in Britain who think that Robinson is a political prisoner. That's the narrative that he's pushed out. That's how he earns his living but it isn't quite true," he said.

On Sunday, Farage responded to Musk, calling the billionaire a "remarkable individual" but saying that he disagreed with his view on Robinson.

"Well, this is a surprise! Elon is a remarkable individual but on this I am afraid I disagree," he wrote. "My view remains that Tommy Robinson is not right for Reform and I never sell out my principles."

Robinson is a controversial far-right figure in the UK who was sentenced to 18 months in prison in October for contempt of court. Musk has repeatedly called for Robinson's release.

Robinson is something of a third rail in the UK. Farage, who does not shy away from controversy, accused the activist during far-right, anti-immigration riots in the UK over the summer of trying to "stir up hatred."

"As for the Tommy Robinsons and those that genuinely do stir up hatred, well, I've never had anything to do with them," Farage said in a video he posted at the time.

Hours before Musk's latest comments, the Reform UK leader described the tech mogul as a "friend" in an interview on the BBC.

Farage said the fact that Musk "supports me politically and supports Reform doesn't mean I have to agree with every single statement he makes on X."

Business Insider has contacted Reform UK for comment.

It's generally a rare thing for the person you're interviewing to burst out laughing. But that's what happened to me, recently, on a call with Ernie Tedeschi, the director of economics at the Yale Budget Lab who in March wrapped up a three-year stint on the White House Council of Economic Advisers. The question that evidently tickled Tedeschi: Was the "vibecession" fake? The vibes around the economy — as in, the way consumers and businesses say they feel about it — have been changing lately, and not because the economy itself is markedly different from how it was in the recent past. Inflation is down from its peak, but it's up a bit from where it was earlier this year. The labor market is still strong, and consumer spending is still solid.

Despite the relatively steady environment, people are feeling a whole lot more enthusiastic. In November, small-business sentiment reached its highest level since June 2021, surveys for the National Federation of Independent Business' optimism index found. The number of business owners who said they expected the economy to improve and thought it's a good time to expand increased significantly. Corporate executives' expectations soared for the fourth quarter, the Business Roundtable's economic-outlook survey found. CEO forecasts for hiring, capital investment, and sales improved.

Consumer sentiment has been on the upward slope for multiple months, surveys from the University of Michigan found, and it is continuing that trend heading into the end of the year. Underneath the top-line number, however, there's been a significant partisan shift. Republicans' expectations around the economy improved in December, while Democrats' got worse. It's part of a trend in economic sentiment: People feel a lot better about the economy and their prospects when the political party they support is in charge. So I wanted to know, was Americans' deep sense of economic pessimism over the past year — and the recent turnaround — just a politically driven mirage?

After the embarrassing-for-me chuckle, Tedeschi responded. "The short answer is no. The vibecession was not fake. The long answer is no, but … ," he said. Perceptions of the economy have to do with more than the economy itself. That doesn't mean that people were lying or that their answers didn't have some real economic motivation, but there's clearly more to it than the material conditions in front of them — it's also about their ideological leanings and how that shapes what they believe is ahead.

"Perceptions of the economy are definitely deeply partisan," Tedeschi said.

When people say the economy feels bad, they can mean a variety of things — prices are too high, the news they read is negative, the president is old. Feelings are not facts, including when it comes to GDP. Politics colors a lot of the way businesses and consumers say they see the world around them, including when it comes to money.

It's easy to say the shift in sentiment is partisan flag-waving — now that Donald Trump is headed to the White House, Republicans are going to say everything's great, and to the Democrats, it's all terrible. But that's not really what's happening, said Joanne Hsu, the director of consumer surveys at the University of Michigan. When people say their expectations are better or worse, it's not simply the outcome of the election they're responding to but the policies they believe are on the horizon.

"With the election of Trump, people have an idea of how economic policy might change over the next year and over the next four years. So people are expecting tariffs. They're expecting action on immigration," Hsu said. "The thing is that people across the population really disagree on whether or not these policy changes are a good thing or a bad thing for the economy."

Democrats are worried that Trump's threatened tariffs and promise to undertake mass-deportation efforts will make things pricier. Republicans, on the other hand, think that these policies will be good for the economy and that Trump will help bring down inflation. Independents, Hsu said, are in the middle.

To a large extent, it makes sense that small businesses and corporate executives feel sunnier about the future. The deregulation and tax cuts that are likely to result from a Trump presidency are music to the business community's ears.

"They're optimistic that policies that they like are going to get enacted over the next four years," Tedeschi said.

Businesses don't love the idea of tariffs, but many are hopeful that there are ways they can get around them or that the president-elect isn't so serious about them. Or they just plan to pass along any price increases to consumers anyway. (There may be some amount of denial going on among corporate executives and Wall Street investors, all of whom seem to be ignoring some of the potential downsides of Trump's policy promises and the instability he could represent.)

Overall, the response is fairly logical — if you think what's to come is good for you, you feel good about it. If you think it's not, the opposite.

Over the past couple of years, there have been a lot of efforts to explain the vibecession, the phenomenon where the economy, on paper, looks pretty good but consumers say it's terrible (even though in many cases, they say that they, personally, are doing just fine). No one has come up with a definite answer on what's going on, though high prices — even as inflation has cooled — are likely a big part of the equation. But the fact of the matter is that people are channeling a lot of things when they evaluate the economy, which is a nebulous concept to many people in the first place.

In a particularly polarized political environment like the one we're in right now, a person's red or blue stripes are inevitably going to influence their evaluations. As much as it may be policy-related, it is also partisan, and it's partisanship that's getting worse.

Hector Sandoval, the director of the Economic Analysis Program at the University of Florida, released a study in early 2024 looking at the impact of national elections on consumer sentiment and spending intentions. The research found a "significant boost to consumer morale" when a person's affiliated party won a presidential election. It also found that over the decades, the swings had become more pronounced.

"It actually became more extreme," Sandoval said. In 1992, when Bill Clinton was elected, there was some partisan change, but it's something one might "not really even bother" to note, he said. It happened in 2000 when George W. Bush was elected, but also to a relatively benign degree. "But then, I will say, 2008, 2016, 2020, especially 2016, those are where you are surprised how the gap is just becoming more and more," Sandoval said.

Michigan has been consistently asking its survey respondents about their political leanings monthly only since 2017, but Hsu said polarization had become increasingly evident in its data over the past 40 years. The gap was especially pronounced under the first Trump administration, she said.

Whether you think the economy is good, bad, or wherever in between, we can all probably agree the way that we measure people's feelings about the economy is a bit broken. It's no longer really possible to say, "XYZ economic data says this, so consumers will feel ABC." It's not clear whether this is a temporary pandemic-driven blip or a permanent shift in how people relate to the economic forces around them. What makes this even more complicated is what consumers say they feel isn't even reflected in what they do. Throughout these past years of turmoil, consumers have said everything is terrible and spent a bunch of money anyway. Many people's bank accounts, especially those in the middle- and upper-income brackets, are fine.

"People are spending as if they are much happier than they are," Tedeschi said. He added that this disconnect between the vibes and the data meant that when the vibes get better, it might not mean much, tangibly. "Even if consumer sentiment recovers, even if the vibecession goes away, it may mean that there's not much of an upside for the real economy," he said.

Economic sentiment is, of course, an economic indicator, but it's also a political indicator. In some respects, it might be a better guide as a poll of political job performance than for how people are actually doing financially. While the vibecession was not fake or some giant mirage, there's more going on beneath the surface. If you're a Republican, you're feeling real good about February. If you're a Democrat, enjoy the last of those good vibes now.

Emily Stewart is a senior correspondent at Business Insider, writing about business and the economy.

• Donald Trump recently appointed Sriram Krishnan to an AI advisory role.
• Krishnan came to the US from India in 2007 and became a US citizen in 2016.
• Indian tech workers initially praised his appointment, but have grown concerned by MAGA criticism.

Anuj Christian's green card was approved in 2019, a decade after he first came to the US as a graduate student from India. Since then, he's been waiting to receive it, one of thousands trapped in a lengthy backlog created by America's byzantine immigration system.

Earlier this month, Christian was hopeful for the first time in years. Just before Christmas, Donald Trump announced that Sriram Krishnan, a first-generation Indian American, would serve as a senior White House policy advisor for AI. Krishnan is set to work closely with Trump's new "crypto czar" David Sacks, an early investor in Facebook, SpaceX, Uber, and Palantir.

For Christian, Krishnan's appointment felt personal. "Sriram has personally been through the immigration system," said Christian, who runs an immigration reform group called FAIR. "Someone who has personally been through this issue is close to the president now. That has never happened before."

From Chennai to Silicon Valley

Krishnan arrived in the US in 2007 from Chennai, India, to begin a six-year stint at Microsoft. From there, he climbed the ranks of Silicon Valley, holding senior roles at Yahoo, Snap, Facebook, and Twitter. In 2020, he moved to venture capital, becoming a general partner at Andreessen Horowitz.

Along the way, Krishnan became a US citizen in 2016, a milestone that eludes many legal immigrants from India. The green card backlog, a byproduct of per-country caps on employment-based permanent US residency, has left thousands of skilled workers from India in limbo. Wait times can now exceed beyond a lifetime.

Krishnan's appointment comes with a unique resonance for those impacted by this system. He has spoken openly about the challenges of navigating US immigration and has advocated for raising the country-based green card caps. These calls for reform have been a recurring theme of The Aarthi and Sriram Show, a podcast he hosts with his tech entrepreneur wife Aarthi Ramamurthy.

MAGA backlash

Krishnan's visibility and advocacy have turned him into a lightning rod for MAGA followers, though. In the days since Trump's announcement, the technologist has faced hate speech and racism directed not just at him but also at Indians and legal immigration in general. Krishnan declined to comment.

The backlash began with a tweet from far-right activist Laura Loomer, who criticized his appointment as "deeply disturbing" and said it conflicted with Trump's "America First" agenda.

Loomer accused Krishnan of advocating to "remove all restrictions on green card caps" and enabling foreign workers to take jobs from American STEM graduates, citing Silicon Valley's reliance on international talent as a threat to domestic innovation. Former Congressman Matt Gaetz, who was Trump's initial pick for attorney general, accused "tech bros" of engineering "an immigration policy."

H-1B visa debate

Rahul Menon, an Indian-born engineer from Rhode Island and host of Area51, a podcast about immigration, believes hate speech directed at Krishnan reflects broader misconceptions about skilled immigrants in the US.

"They just assume we are here to steal everyone's jobs," Menon told Business Insider. "If people understood the process of getting through an H-1B and the number of hoops you need to jump through, it's insane. The hate that Sriram is getting is just the beginning. You just need a thick skin to do the job."

Some of the scorn has been directed at H-1Bs, a common visa type that Silicon Valley companies and tech outsourcing firms use to hire foreign workers in the US. This particular system is also overwhelmed by huge volumes of applications for a limited number of slots each year. Bloomberg News uncovered a scheme earlier this year, known as "multiple registration," that manipulates the H-1B program and prevents what it described as legitimate talent from accessing these skilled-worker visa-based opportunities.

Recent optimism

Menon noted that optimism around addressing the green card backlog has been steadily growing, fueled by statements from high-profile figures. During a June appearance on the All-In Podcast hosted by VCs including Sacks, Trump expressed support for granting green cards to all US college graduates. Trump also recently voiced support for H-1B visas.

Menon sees Krishnan's appointment as the latest in a series of developments boosting morale among advocates for US immigration reform.

"It started with Trump saying that, then with Vivek, and now with Sriram — it's the cherry on top," Menon said, referring to Vivek Ramaswamy, another Trump advisor whose parents immigrated from Kerala, India. Ramaswamy has repeatedly called for the H-1B lottery system to be replaced with a selection process based on merit.

"AI stands for artificial intelligence, not American Indian"

Others remain skeptical about Krishnan's ability to influence immigration policy in his new role.

Sacks addressed the speculation directly in a tweet: "Sriram has been a US citizen for a decade. He's not 'running America.' He's advising on AI policy. He will have no influence over US immigration policy." The post appeared aimed at calming criticism from MAGA loyalists and quelling hope among some Indian immigrants that Krishnan's appointment would lead to immediate changes.

Ash Arora, a partner at VC firm LocalGlobe, and a friend of Krishnan and his wife, Ramamurthy, cautioned against reading too much into Krishnan's role when it comes to immigration reform.

"Sriram has been hired for AI — and AI stands for artificial intelligence, not American Indian," she told Business Insider. "I'm not sure whether Sriram will have a say in immigration matters, but the optimism about legal immigration being fixed, in my opinion, is misguided."

Ultimately, Krishnan is an AI policy advisor, Area51's Menon said. "I'd like to hope things will change. But let's not count our chickens before they've hatched."