Hey, Elon-Put *OUR* Money Where Your Big, Fat Mouth Is
In one of my periodic Quixotic moments, I tilted at the Cult of Elon Musk. First, I argued that he or someone manipulated the prices of Tesla and Solar City stocks: I stand by that analysis. Second, I argued that the supposed visionary's true genius was for feeding lustily at the taxpayer teat.
It is a testament to my great influence that the Cult of Musk has grown only larger in the two years since I made a run at him. But maybe the spell is breaking. For the LA Times just ran a long article detailing just how much his fortune was picked from our pockets. According to the LAT, Musk companies have raked in $4.9 billion in various subsidies and tax breaks, give or take.
That's 10 figures, people.
That's bad enough. What's worse is Musk's "defense." It is a farrago of intellectual dishonesty, logical fallacies, condescension, and arrogance.
Musk only replied to the LAT after repeated inquiries, but it is good that the paper persisted. Musk's rationalizations have to be seen to be believed.
For one thing, he says he doesn't really need the subsidies:
"If I cared about subsidies, I would have entered the oil and gas industry," said Musk.
. . . .
"Tesla could be profitable right now if we went into low-growth mode and we just served premium buyers," he said. "The reason we are not profitable is because we are making massive investments to create an affordable long-range electric car."
We are making massive investments? What do you mean by "we", paleface?
So fine. You don't care about subsidies. You don't need them.
Then put your money-excuse me, our money-where your big fat mouth is and don't cash the checks.
The rest of Musk's defense consists of various incarnations of N wrongs make a right (or, put differently, other people suck at the government teat, why shouldn't I?):
Musk said the subsidies for Tesla and SolarCity are "a pittance" compared with government support of the oil and gas industry.
"What is remarkable about my companies is that they have been successful despite having such a tiny incentive from the government relative to our competitors," Musk told The Times.
. . . .
Tesla, Musk said, competes with a mature auto industry that has seen massive federal bailouts for General Motors and Chrysler.
"Tesla and Ford are the only American auto companies not to have gone bankrupt," Musk said.
SolarCity, he said, is in a nascent industry that must fight entrenched oil and gas interests that have myriad subsidies.
Throwing good money after bad is not good public policy.
Musk cites numerous junk studies to support his case. Some of these are studies of the alleged economic benefits arising from investments in his battery plants, etc. I guarantee, all such studies are garbage based on mythical multipliers and crypto-Keynesian mumbo jumbo. Others are studies of the alleged subsidies of other industries, notably the energy industry. Even taking the numbers at face value, the subsidies of fossil fuels are a pittance on a per BTU or megawatt basis compared to those for renewables. Further, fossil fuels are also heavily taxed directly and indirectly, including by substantial geopolitical and expropriation risks. The study that cites the environmental costs of fossil fuels is particularly susceptible to abuse. And to quote Sonicharm, of the blog Rhymes With Cars and Girls-also not a Musk fan!-all large calculations are wrong.
Elon Musk is a rent seeker masquerading as a visionary. If he is one-tenth the innovator and genius his fawning fans believe him to be he wouldn't need any subsidies. We should give him the chance to prove it.