Slashdot Mirror
How Elon Musk's Growing Empire is Fueled By Government Subsidies
theodp writes: By the Los Angeles Times' reckoning, Elon Musk's Tesla Motors, SolarCity, and SpaceX together have benefited from an estimated $4.9 billion in government support. The figure compiled by The Times, explains reporter Jerry Hirsch, comprises a variety of government incentives, including grants, tax breaks, factory construction, discounted loans and environmental credits that Tesla can sell. It also includes tax credits and rebates to buyers of solar panels and electric cars. "He definitely goes where there is government money," said an equity research analyst. "Musk and his companies' investors enjoy most of the financial upside of the government support, while taxpayers shoulder the cost," Hirsch adds. "The payoff for the public would come in the form of major pollution reductions, but only if solar panels and electric cars break through as viable mass-market products. For now, both remain niche products for mostly well-heeled customers." And as Musk moves into a new industry — battery-based home energy storage — Hirsch notes Tesla has already secured a commitment of $126 million in California subsidies to companies developing energy storage technology.
Employing mainly Americans, manufacturing in America.
They forgot the benefit that it gets us out of the Middle East. That sandtrap is a massive waste of resources that I hate is being subsidized.
So we have a brilliant industrialist creating new pathways that we will all benefit from. In this case I hope the government gives him even more money. We need these technologies and a support system to actually conquer some of the issues that now confront us.
If the people pass laws to promote businesses investing in developing new capabilities (e.g. space flight) then we WANT companies to do that work and thus get those grants, tax breaks, etc. That's how the airline industry got launched in the US, for example - huge government subsidies (airports, air traffic control system) and contracts (for mail delivery) that jump started the US airline industry, which was IMO a brilliant investment, because transportation doesn't just benefit the company providing transportation, it benefits everyone who uses transportation. Highways were another brilliant investment, funding construction companies and thus jobs, and creating a national road system that everyone benefits from.
The subsidies/grants/tax breaks that I object to are the ones that go to mature, profitable industries that don't need any support because they should be able to survive on their own. Oil companies and sports teams are just the most blatant examples. Agri-business corporations don't need subsidies, either - the farming grants should be reserved for the few percent of farmers who are independent, small family farms, and right now the money all goes to huge, profitable corporations that have huge resources and don't need the money, and relatively little to the small farms that need the support to survive the ups-and-downs of farming.
Enable 3D printed prosthetics!
Loans that were fully paid back (e.g. the one Tesla got). Space launches for the government that are *cheaper* than the other launch services the government is using. You can't call it a subsidy when they are selling the government a service.
Most of the other clean tax subsidies are given to the clients (e.g. SolarCity, Tesla) not to Musk's companies directly. If they are that rich, as the author claims they are, I think they would still buy the cars to make a kind of fashion statement even if there was no tax break at all.
As for the tax breaks he gets for building that factory its no different from what any other company doing a similar activity would get. Yes I know its crap but its the world goes.
Those tax breaks and subsidies were set up to encourage advancement in those areas by offering an economic incentive. Musk just did exactly what the government was handing out money for people to do... advance those areas.
while(1) attack(People.Sandy);
OK, I bet there is an image of a crowd of thousands of men with their lunch pails all walking into their shift at the plant who then jump on the line and build cars.
No.
At best it's a couple of dozen people working in the back office and some techs to walk around and monitor the automated plant.
Tesla has 6000 employees
But go ahead and keep undermining your arguments with such unnecessary hyperbole, mister Anonymous Coward.
I'm a leaf on the wind. Watch how I soar.
At best it's a couple of dozen people working in the back office and some techs to walk around and monitor the automated plant.
A quick look at Wikipedia says Tesla had 10,000 employees in November of 2014 and SpaceX had 3,500 employees in April of 2015.
You didn't even bother with that much fact checking about what you 'know', though, did you. Your entire post is a demonstration of idiocy in action.
Education is extremely well-funded in the US. We are, depending on how you measure, either #1 or #2 in the world. Funding is very uneven and the money is often not spent well. But you cannot say we don't fund education adequately. Reform is the answer, not more money.
W..w..W - Willy Waterloo washes Warren Wiggins who is washing Waldo Woo.
How funny.
Tesla employed over 6000 full-time last sept. That does not include ppl working on gigafactory.My guess is that with model X gearing up that it will jump to 10,000 by Jan.
Solar city employs full time over 8000 as of Dec, 2014. And they doubled last year They are still hiring like mad. Again, that does not include those working on the new 1gw/year solar plantS. On a side note , it turns out that solar employs more ppl than coal.
spacex employed more than 3000 last summer when they cleaned house of 150. In addition, they said that they would be at 3600 by 2015.
So, musk employs conservatily, 25,000 ppl and it is growing very fast. OTOH, the fossil fuel industry is subsidized more than 8b PER year in America. In fact, we pay 1 B / year to cover coal miners health. I would suggest that we look to kill a number of subsidies, esp in the fossil fuel arena.
I prefer the "u" in honour as it seems to be missing these days.
$4.9 billion? That's nothing compared to the Koch brothers. They got more than twice that amount.
XML is like violence. If it doesn't solve your problem, you're not using enough of it. --AC
so the early auto producers managed to get the US to redo all of it's roads.
Early auto producers exploited the decades of lobbying already done by cyclists.
http://www.theguardian.com/env...
Carlton Reid
19th century cyclists paved the way for modern motorists' roads
Car drivers assume the roads were built for them, but it was cyclists who first lobbied for flat roads more than 100 years ago
Wooden hobbyhorses evolved into velocipedes; velocipedes evolved into safety bicycles; safety bicycles evolved into automobiles.
It's well known that the automotive industry grew from seeds planted in the fertile soil that was the late 19th century bicycle market. And to many motorists it's back in the 19th century that bicycles belong. Cars are deemed to be modern; bicycles are Victorian.
Many motorists also assume that roads were built for them. In fact, cars are the johnny-come-latelies of highways.
The hard, flat road surfaces we take for granted are relatively new. Asphalt surfaces weren't widespread until the 1930s. So, are motorists to thank for this smoothness?
No. The improvement of roads was first lobbied for - and paid for - by cycling organisations.
In the UK and the US, cyclists lobbied for better road surfaces for a full 30 years before motoring organisations did the same. Cyclists were ahead of their time.
When railways took off from the 1840s, the coaching trade died, leaving roads almost unused and in poor condition. Cyclists were the first vehicle operators in a generation to go on long journeys, town to town. Cyclists helped save many roads from being grubbed up.
Roads in towns were sometimes well surfaced. Poor areas were cobbled; upmarket areas were covered in granite setts (what many localities call cobbles). Pretty much every other road was left unsurfaced and would be the colour of the local stone. Many 19th century authors waxed lyrical about the varied and beautiful colours of British roads.
Cyclists' organisations, such as Cyclists' Touring Club in the UK and League of American Wheelmen (LAW) in the US, lobbied county surveyors and politicians to build better roads. The US Good Roads movement, set up by LAW, was highly influential. LAW once had the then US president turn up at its annual general meeting.
The CTC individual in charge of the UK version of the Good Roads movement, William Rees Jeffreys, organised asphalt trials before cars became common. He took the reins of the Roads Improvement Association (RIA) in 1890, while working for the CTC.
He later became an arch motorist and the RIA morphed into a motoring organisation. Rees Jeffreys called for motorways in Britain 50 years prior to their introduction. But he never forgot his roots. In a 1949 book, Rees Jeffreys - described by former prime minister David Lloyd George as "the greatest authority on roads in the United Kingdom and one of the greatest in the whole world" â" wrote that cyclists paved the way, as it were, for motorists. Without the efforts of cyclists, he said, motorists would not have had as many roads to drive on. Lots of other authors in the early days of motoring said the same but this debt owed to cyclists by motorists is long forgotten.
The CTC created the RIA in 1885 and, in 1886, organised the first ever Roads Conference in Britain. With patronage - and cash - from aristocrats and royals, the CTC published influential pamphlets on road design and how to create better road surfaces. In some areas, county surveyors took this on board (some were CTC members) and started to improve their local roads.
Even though it was started and paid for by cyclists, the RIA stressed from its foundation that it was lobbying for better roads to be used by all, not just cyclists.
However, in 1896 everything changed. Motoring big-wigs lobbied for the Locomotives Amendment Act to be repeal
Mit der Dummheit kämpfen Götter selbst vergebens
Actually, Apple, Microsoft, and Google have taken billions in money from the feds.
In addition:
1) Solar City is only everybody's buildings. Also, we should stop the Solar subsidies since many companies no longer need them. Far better is to simply require that all new buildings below 6 stories to have enough on-site AE to equal their HVAC's energy usage.
2) SpaceX is the cheapest launch system going. Bar none. And they are about to be even cheaper. So far, SpaceX has actually SAVED the feds more money than it has costs them.
3) Tesla's Model S and X is currently for the upper middle class to wealthy. Probably it is the upper 1/3 that affords these. OTOH, in about 2 years, it will be the upper 2/3 that affords them.
Finally, claiming that it is the POOR that pay for these subsidies is a joke. Right now, in America, the bottom 50% pay NOTHING in the federal taxes. So, like the rest of your post, total BS.
And it would be irresponsible for Musk to NOT take the subsidies. Where the real problem is, that gov, feds and states, are giving these out. Hell, the fossil fuel industry gets 8B / year. That should be stopped NOW.
I prefer the "u" in honour as it seems to be missing these days.
Another way to descript this would be:
Elon Musk structures his businesses to support government priorities.
The real "Libtards" are the Libertarians!
...he fossil fuel industry is subsidized more than 8b PER year in America...
Not to mention that the Internet was started by the government. And companies like Lockheed Martin rely almost completely on government military subsidies. This article was a hit piece. The American media really is shockingly corrupt.
This and no other is the root from which a tyrant springs; when first he appears as a protector - Plato (423 to 327 BC)
This.
When you consider that there are now over 1600 billionaires, how many of them are "using their powers for good" to the degree that Musk does? Sure there's the Gates Foundation, and other philanthropic efforts, there's the Tata Motors guy in India... some VC guys like Khosla... But out of 1600 people, what a tiny percentage of them even show up on the radar screen, let alone those who are doing "cool stuff" with their immense wealth and power.
If every billionaire used his wealth like Musk does, I wouldn't mind this staggering inequality so much. Sadly, Musk is more an exception than the rule.
XML is like violence. If it doesn't solve your problem, you're not using enough of it. --AC
and they go out of their way to hire veterans: http://www.military.com/vetera...
And they doing their best to insure that most of the battery production in the world will be done in the U.S. in the future: http://www.teslamotors.com/gig...
And oh by the way they are the future of the car industry... and perhaps getting the U.S. energy independent in a sustainable way...
But yah, let's bitch about giving them tax breaks... because we need to save those for more worthy industries (sarcasm).
Pat