Delaware’s business-friendly reputation is why the state has just about one million residents, but two million registered business entities.

That is, until the state's corporate-focused Court of Chancery twice denied Tesla's proposed pay package for Musk, even though it was fully shareholder-approved. The decision was exactly the kind of nanny-statism that companies incorporated in Delaware to avoid.

So Tesla reincorporated in Texas — Wall Street firms have major outposts there now, too, as well as in Florida — and SpaceX quickly followed.

Serving as a corporate P.O. box accounts for as much as one-third of Delaware's state revenues. But clearly that's changing almost as quickly as the Court of Chancery sabotaged the state's reputation in a fit of suicidal pique over Musk's politics. //

What's amazing about Delaware's "bad luck" is just how quickly things began to unravel. It's been more than a century since Delaware became the favorite place for businesses located anywhere to incorporate, thanks to expert Chancery Court judges, predictable corporate legal precedents, and a light regulatory touch. The First State quickly became the legal home for most Fortune 500 companies. No factories. No fancy headquarters. Just a P.O. box. //

Capital finds a way, to misquote Dr. Ian Malcolm.

But as Elon Musk could tell you — and probably did, if you follow him on X — it's a helluva lot easier to move a corporate P.O. box than it is to relocate a billion-dollar HQ.

Delaware forgot that. The exodus has begun.