The stock market has been kind to Elon Musk, who has used and abused Wall Street in return. His latest piece of showmanship—an offer to take electric-car makerTesla Inc. private—amounts to a slap in the face for shareholders. Worse, Mr. Musk’s reasoning for abandoning Tesla’s listing is flawed at almost every level. The saving grace is that if the deal goes ahead, shareholders can bail out by accepting Mr. Musk’s offer at a premium of 23% above Monday’s undisturbed price.

The basic argument is increasingly deployed by frustrated...