- [Narrator] This is Snailbrook, Texas,

a new planned community outside of Austin

that Elon Musk is building for employees

at his Tesla, SpaceX, and Boring companies.

And this is Starbase, a rocket development site

and another new Musk city with housing for SpaceX employees

located outside of Brownsville, Texas.

Recent construction at both of these sites

has led to speculation that Musk is building company towns.

- We think that this Big Brother like control

that's associated with company towns is un-American.

History shows that, that has been

a big part of American industrial history.

(crowd cheering)

- Hey.

- [Narrator] Here's why Musk might be

looking to the company town model

for his properties in Texas.

(gentle music)

- My wife and I bought this property about 10 years ago.

We originally came for the nature

and the privacy and the peacefulness.

- [Narrator] This is Chap Ambrose.

In 2021, Elon Musk's Boring Company

bought the 70-acre cow pasture

that sat below Ambrose's property.

- I am a fan of Elon Musk.

I think a lot of what he does is really cool and inspiring.

- [Narrator] Such a fan, in fact,

he even owns a remote-controlled cyber truck,

but Ambrose quickly soured on his new neighbors.

(truck rumbling)

- It's been a radical change since they moved in.

They really are building a shipyard

in the middle of a prairie.

- [Narrator] And that's not all they're building.

As first reported in the Wall Street Journal in March,

in meetings with landowners and real estate agents,

Musk and his employees describe a vision

of a Utopia along the Colorado River.

Here in Bastrop County,

approximately 45 minutes outside of Austin,

SpaceX is building a 500,000 square foot facility.

Across the street, Boring is building a new warehouse.

Snailbrook is already home to some Musk employees

who live in modular homes.

There's also a pool, an outdoor sports area, and a gym.

Plans suggest the site will eventually have 110 homes

and Boring plans to convert one into a Montessori school.

As of last year, Boring employees

could apply for a home with rents

starting at about $800 a month

for a two or three bedroom in Snailbrook.

The median rent in Bastrop is about $2,200 a month.

For his part, Ambrose welcomes the economic impact

that Snailbrook's residents will bring to the area.

His primary concern is how the development

could affect the local groundwater.

- If you sit out and watch the work they do,

they're not careful.

- [Narrator] Recently, Boring applied

to state environmental authorities

to discharge up to 140,000 gallons

of industrial wastewater a day into the Colorado River.

Since beginning construction,

Boring has received multiple violations

from the Texas Commission on Environmental Quality.

Ever since Musk's companies moved in next door,

Ambrose has been documenting the development.

- I'm concerned they're gonna continue

to break those permits.

I mean, they are moving so quick,

one week to the next it can be a radical difference.

- [Narrator] Musk tweeted that

the March Wall Street Journal article

that broke the news about Snailbrook was false,

but he has not specified what in the piece was incorrect.

Furthermore, the idea that Musk

would create his own town isn't far-fetched.

- Sometimes there's that new neighbor

that everyone can't stop talking about,

for better or for worse.

- [Narrator] In 2021, the billionaire announced

he was building the city of Starbase,

which Musk envisions becoming a major space port.

Starbase is being built on Boca Chica Village,

a seaside hamlet surrounded by a wildlife refuge.

Located about 25 miles outside

of the southeastern Texas city of Brownsville.

SpaceX has not officially incorporated Starbase,

but since 2012, the aerospace company

has been buying up the area's pre-existing homes

and turning them into employee housing.

Much like Snailbrook, Starbase's development

attracted scrutiny from residents

concerned that SpaceX's expansion

will come at a steep price to the local environment.

♪ You load 16 tons and what do you get? ♪

♪ Another day older and deeper in debt ♪

- [Narrator] In 1947, country singer Merle Travis

immortalized exploitative nature of company towns

in his song "16 tons"

about the life of a Kentucky coal miner.

♪ I owe my soul to the company store ♪

- People tend to think of about a town

where the company owns everything.

Where the company has built all the housing,

there's a company store

and many of these coal mining towns

people were not paid in American currency.

They're paid in company-issued money

that's really only good at the company store.

- [Narrator] Author, Hardy Green, has written extensively

about the history of company towns.

- There is no strict definition of a company town.

A company town, there's really

only one company that dominates.

But beyond that, there's a wide range.

Some towns are more restrictive, more exploitative

and others are more caring and paternalistic.

- [Narrator] The more exploitative company towns

like the one referred to in Travis' song

tended to be communities based around a single resource.

- Whole towns or extractive industry towns

tend to be a little bit like prison camps.

- [Narrator] Like Snailbrook and Starbase,

many of America's oldest and best known company towns

like Pullman, Illinois and Hershey, Pennsylvania

were created by wealthy industrialists

who envisioned idyllic communities for their employees.

- Utopian ideals have figured prominently

in a number of company towns.

- [Narrator] Milton Hershey built

his chocolate factory complex in rural Pennsylvania

to attract employees to what was then a remote location.

Hershey constructed a town.

- Workers were allowed to buy the housing.

They're fairly well paid.

The houses come with central heating and plumbing.

- [Narrator] But Milton Hershey's relationship

with his employees soured.

In 1937, Hershey's workers organized

the company's first labor union, and went on strike.

That's a common theme in the history of many company towns.

Like Hershey, Pullman, Illinois

was a paternalistic company town that had housing,

stores, a library and churches,

but Pullman like Hershey eventually ran into trouble.

In 1894, Pullman cut jobs and wages,

sparking a violent worker's strike.

- It started off being an experiment that

the founders thought would be a kind of paternalistic place,

but it didn't work out.

- [Narrator] According to Green,

Musk's towns somewhat resemble

the paternalistic company towns of old.

- Yeah, you could argue that Musk

is employing a kind of a throwback idea

of starting from scratch in an undeveloped area.

- [Narrator] An undeveloped area

that is being developed quickly

even as it is under the close watch of Chap Ambrose.

- We're not anti-growth, we're not anti-Elon,

but we are pro-clean water.

And unfortunately, those opposing forces

seem to be coming to head for some reason.

(ominous music)

- [Narrator] Whether Snailbrook or Starbase

will avoid the pitfalls of previous company towns

remains to be seen.

Neither have yet been incorporated,

so technically, neither exists in a legal sense,

but if Musk does decide to incorporate either town

that shouldn't be too difficult.

In Texas, as soon as a community has 201 residents

it can petition to incorporate.

(ominous music continues)