That advantage isn't so important on its own - launch business is small and will probably not get much bigger - but it gives them an effective monopoly on deciding which space system get created and which don't - because they can always beat any possible competition just by launching their version much cheaper.
That is a truly enviable position one can only compare to Standard Oil in its best days - because of that private deal with railways they had - except in this case this is literally the same business.
The other problems of course is Musk himself, both because he's directly aggravating his own employees[0], and the Democrats (who, in the absence of a dictatorship, can be expected to regain government control in the not too distant future), and also a lot of non-US politicians (the list of nations he's aggravated includes all of his 3 citizenships but also far more besides) and phrases like "security risk" are getting thrown around.
[0] https://www.lawcommentary.com/articles/nine-spacex-workers-p...
