Should Taxpayers Back Cars Only the Rich Can Afford? 752
theodp writes "The NY Times questions the $400M in low-interest federal loans requested by Tesla Motors as part of the $25B loan package for the auto industry passed by Congress last year. 'The program is intended to encourage automakers to improve fuel efficiency, but should it be used for a purpose like this, as the 2008 Bailout of Very, Very High-Net-Worth Individuals Who Invested in Tesla Motors Act?' Tesla says it is assembling about 15 cars a week and has delivered about 80 of its $109,000 base-price Roadsters to date, many of which have gone to the Valley's billionaires and centimillionaires who are Tesla investors as well as early customers. We discussed the company's financial difficulties last month."
Taxpayers shouldn't be bailing out any of these (Score:5, Insightful)
Let the market decide, not a group of politicians paid off by lobbyists from the money they're lobbying to get.
Re:Taxpayers shouldn't be bailing out any of these (Score:5, Interesting)
I find this interesting after there was a story on Digg yesterday about Tesla complaining that the car companies wanted this $25 billion to bail them out rather than use it for what it was intended for. I think it's pretty shifty since this fund was set up last year and in no way was meant to be a bailout.
Here's the link to that story:
http://gas2.org/2008/11/28/tesla-says-money-shouldnt-be-diverted-to-bailout-car-makers/ [gas2.org]
Re:Taxpayers shouldn't be bailing out any of these (Score:5, Insightful)
Let the market decide, not a group of politicians paid off by lobbyists from the money they're lobbying to get.
Tesla agrees. They've been very public about their opposition to the bailout. But if there is going to be one, Tesla should get money too.
Re:Taxpayers shouldn't be bailing out any of these (Score:4, Insightful)
The 25 billion dollar Advanced Technology Vehicle Manufacturing Incentive Program (ATVM) fund is not for bailouts, it's for low-interest federal loans to companies investing in ... wait for it ... Advanced Technology Vehicle Manufacturing.
Tesla doesn't need a bailout, and isn't asking for one.
Please folks, get your facts straight before blathering about 'letting the market decide'. And besides, letting the market decide didn't turn out so well in the finance and banking sector, now, did it?
Re: (Score:3, Insightful)
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AKA "corporatism"
Fascism vs. Socialism: false dichotomy (Score:5, Interesting)
If you read about fascism from the horse's mouth [hitler.org], you'll see, that there is no difference. Here, I picked the most familiar-sounding items put forth 88 years ago:
Had it not been for Hitler's bizarre obsession with genocide — which, as Franco and Mussolini demonstrated, is not an inalienable part of Fascism — the Left would've considered Hitler as a perfectly respectable source of quotes and inspiration, along with Lenin, Mao, and Karl Marx.
Re:Fascism vs. Socialism: false dichotomy (Score:4, Insightful)
Had it not been for Hitler's bizarre obsession with genocide [...]
Stalin, Lenin, and Mao were all mass murderers. In case with Stalin, a case could be made for genocide. I basically agree with you, but I think that Hitler only needed to tie the war with Russians and then he would be safely on his way to join the pantheon of great leaders of antiquity. To History, his only mortal sin was loosing.
Re:Fascism vs. Socialism: false dichotomy (Score:5, Insightful)
Did you even read what you posted? That document is a conservative dream come true.
We demand that the State shall make it its primary duty to provide a livelihood for its citizens.
"The government's primary role is to keep the economy strong, not to provide social programs."
It must be the first duty of every citizen to perform physical or mental work. ... The abolition of incomes unearned by work.
"No welfare for anyone. If you can't do work then you starve."
... personal enrichment from war must be regarded as a crime against the nation.
"Only those with special connections in the government will get war contracts."
We demand the ruthless prosecution of those whose activities are injurious to the common interest. Common criminals, usurers, profiteers, etc., must be punished with death, whatever their creed or race.
"The Death Penalty shall be used frequently. We're tough on crime."
I see nothing in there about liberal ideals: human rights, equality before the law, right to conscientious objection, freedom of religion, freedom of thought, environmentalism, peace. Read some Marx.
Re:Fascism vs. Socialism: false dichotomy (Score:4, Insightful)
The Democrats?
What do they have to do with left wing politics? They're a right wing political party, just like your Republicans.
Re:Fascism vs. Socialism: false dichotomy (Score:4, Informative)
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However you should leave Marx out of it. Oh please, throw som
Re:Fascism vs. Socialism: false dichotomy (Score:4, Funny)
he were often absolutely right. In either case he were no monster...Oh please, throw some stupid quote about the dictatorship of the proletariat on me, it will be so embarassing.
That were be embarrassing.
Re:Fascism vs. Socialism: false dichotomy (Score:5, Insightful)
It's a logical fallacy to assume that an evil genocidal bastard like Hitler is incapable of saying or supporting anything that is good just because he is an evil genocidal bastard.
Some of stuff you quoted seems very logical to me, other stuff isn't. I'm definitely against nationalization of industries, but are you honestly going to tell me that we shouldn't prohibit child labor?
Argue against the points, individually, on their merits. Don't label it as fascism just because "Hitler said it."
Re:Fascism vs. Socialism: false dichotomy (Score:5, Insightful)
No True Scotsman, good sir. You're saying that so long as we accept your definitions, why, there's no argument at all!
But that's silly, when we let one party dictate all the definitions, so that when I say socialism and fascism they always mean what you want, and not what I intended, well... What information has really been expressed?
You can't define the terms other people are using. If there's a disparity in definitions you have to agree to disagree and continue on in the argument and attempt to not taint your opponent's views with your preconceived notions.
Re:Fascism vs. Socialism: false dichotomy (Score:5, Insightful)
where were you, when the term "Bushitler" was passed around?
Actually, that's the first time I've heard the term, so that may be a good question.
Face it, a mere allegation of any similarity with Hitler is a powerful assault [wordpress.com] and I don't remember much opposition to that before.
Valid similarities to Hitler's actions and policies are, of course, a powerful assault. Stuff like what you've posted are called "jokes." I won't bother to explain it, though...in the words of Saavik, "Humor. It is a difficult concept."
I have no idea why you didn't hear the opposition to comparisons of Bush with Hitler. They were there, and calls that the thread had been godwined [wikipedia.org] were everywhere.
That's not to say that comparisons to Hitler are automatically invalid, but you need to justify the comparison with examples of the similar reprehensible actions. Not just any action that Hitler took, but the actions that caused him to be labeled "evil." Obviously Hitler took a shit every once in a while, but a comparison between you and Hitler because you also take a shit every once in a while doesn't tell anybody anything about what type of person you are. Other than admitting that Hitler was actually human, which is pretty offensive to the rest of us who are part of the same species, I suppose.
The point here was to simply remind, that Fascism and Socialism (whatever their merits) are no different from each other.
I know that's what you were trying to do, but my point was that not everything Hitler did or say was fascist or socialist just because he was pushing that agenda. So quoting him to make that point is an invalid argument.
In fact, Hitler's party was called "National Socialism Party". Thus pitching them as some sort of opposites is just that: a false dichotomy.
Oh please, that's called marketing. The Democratic Party call themselves democrats so the party can't POSSIBLY do anything undemocratic, huh? Google's motto is "do no evil" but that doesn't stop them from censoring web pages in China, right?
Well, honestly, what stronger evidence of something being Fascism can there be, than "Hitler said it"?
Ok, let me help you out. First, use the accepted definition of Fascism [merriam-webster.com]. According to Merriam-Webster dictionary, it is a political philosophy that places the nation and/or race above the individual, with a centralized government, often a dictatorship, with strong control over social and economic aspects, and which forcefully supresses opposition.
Let's now take the accepted definition of a Socialism [merriam-webster.com]. According to Merriam-Webster that's a political philosophy that advocates collective or state ownership of the means of production and distribution of goods.
Let's examine one of your Hitler quotes, "We demand the creation and maintenance of a healthy middle class." That would obviously fall under Socialism, because the government is supplying the distribution of goods necessary to maintain the healthy middle class. That would not fall under fascism unless it is satisfy the other requirements, namely "silencing the opposition" and valuing the nation or race over the individuals. If "maintaining a healthy middle class" means confiscating every profit you make that place your worth above what is considered "middle class" that would fascism because it would be valuing the "good of the nation" over your rightfully earned money.
Also, this really doesn't need to be said, but I suspect you might bring it up. Confiscating your profits that place you over the middle-class does not mean you can't b
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Bullshit. The German Workers' Party renamed themselves the National Socialist German Workers' Party [wikipedia.org] to capitalize on the popularity of socialism in Weimar Germany. They were never remotely "left-wing". Their primary political opponents prior to taking power in 1933 were the Social Democratic Party of Germany [wikipedia.org], the most popular left-wing party in pre-war Germany.
Re:Fascism vs. Socialism: false dichotomy (Score:5, Informative)
Actually, I think godwin's law isn't about not talking about Hitler as much as it was about comparing others to Hitler and Nazi Germany. The point being is that you can have a discussion about Hitler and Germany, however when your disusing killing puppies or whatever then someone claims someone else is just like Hitler or a nazi or something, they would have lost.
It's actually more about straw-man attacks and so on then the actual subject. Pointing out something is factually correct or the same wouldn't or shouldn't trip godwin's law. I mean someone attempting to resurrect the Third Reich and calling it thee pretty ponies society shouldn't get a pass from legit criticism.
Re:Fascism vs. Socialism: false dichotomy (Score:4, Interesting)
The problem with Marxism is that it only work if everyone participating voluntarily submits to it.
In reality, emotions like envy and greed make that impracticable and unlikely over the long run. It also required people to do more then they think they need to which means you will need some central power controlling people.
The results of this means that outside of isolated hippy communes, eventually someone either gets corrupted by the power or they end up needing to enforce their power with violence. While it is a good idea in theory, no one has ever been able to implement it and no one will be because it just can't deal with human emotions. These emotions are present and you will see them everywhere. In about every work place there are people who think someone makes to much money for the work they do, there are people who think they do more work then others and there are people who think they aren't making enough for the amount of work they are doing. Of course there are more examples but those are the obvious ones. None of that will magically go away with Marxism which is why it will never work without a violent means of enforcement. When I'm saying violent, I'm talking about imprisonment, people with guns and so on.
Re:Taxpayers shouldn't be bailing out any of these (Score:4, Funny)
America's rate of corporate tax is among the highest in the world.
I wouldn't say that's entirely correct [wikipedia.org].
Re:Taxpayers shouldn't be bailing out any of these (Score:5, Insightful)
America's rate of corporate tax is among the highest in the world.
I wouldn't say that's entirely correct [wikipedia.org].
Go back and look at that graph again. Note the magenta line designating corporate income tax. The rate in the US is the second highest in the world. So yes, the parent post is correct.
Re:Taxpayers shouldn't be bailing out any of these (Score:5, Insightful)
America's rate of corporate tax is among the highest in the world.
That's only true in the sense that the tax rate is high, but has no bearing on how much tax corporations actually pay [cnn.com].
There are so many special interest loopholes in our tax code, we could make the tax rate 100% and most companies still wouldn't pay any substantial amount in taxes.
I hear that bogus line so many times, it's a Rush Limbaugh talking point with no basis in reality.
Re:Taxpayers shouldn't be bailing out any of these (Score:5, Informative)
There is nothing bogus in it — the tax rate is very high, and those, who don't pay any simply have no net income left. Read your own link carefully and you'll see:
and, even easier to understand and feel:
Being an owner of one such small business, I can confirm this — at the end of each year, whatever is left on the business account, is paid to me as salary/bonus: from which I pay income tax. This leaves the corporation with zeroed-out income. Leaving money on the business account makes no sense — the corporation would have to pay tax on it first, and then, if it ever decides to pay employees (or shareholders) with it, those people would have to pay income tax on these same monies. Better to dispense with it right away. And if you need money later, you can borrow, because interest rates are much lower, than taxes (unless we are in a credit-crunch).
Re:Taxpayers shouldn't be bailing out any of these (Score:5, Insightful)
These bailouts have nothing to do with socialism, it just good ol' fascism at work, the way we're used to in the United States. Corporate greed, lobbyists and a puppet government under the megacorps and all that.
Now, a bit of real socialism, that's what would be a refreshing change in the US...
Re:Taxpayers shouldn't be bailing out any of these (Score:5, Insightful)
Only in the US could both Robin Hood and the Sheriff of Nottingham both be put under the same banner of socialism.
Modern socialdemocratic countries is about operating a service at a loss because it is generally accepted through general elections that they are better operated that way, be it from an economical perspective, a humanitarian perspective, an environmental perspective or really any other reason we can agree that society is better off. Examples can be utility services (economics), public healthcare (humanitarian), public transportation (environment) or public education (society in general). Other examples can be regulation conditions to ensure that people on the outskrits have access to electricity, phone service, post service even if it's not economically profitable to provide them.
I'm aware that certain purebred liberitarians would call this "legitimate stealing" through taxes, but be that as it may it's in general the masses taking funds from the few. Corporate welfare through increased taxes is everything but socialism, Nationalizing the car companies might, but then you'd have to take a leap past Europe and into Soviet-era socialism and noone's really talking of doing that. All they want to do is take society's money and throw it down a big hole to keep people in work rather than show the true unemployment numbers cropping up. If they're already struggling now I don't see how they can come out on the other side of this alive. An economic downturn like this isn't over in a matter of months.
Re:Taxpayers shouldn't be bailing out any of these (Score:4, Funny)
Big three, would that be GM, Ford, Chrysler and Toyota?
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Yeah...Walmart has it all WRONG.
LOL. You're so precious. Don't ever change.
Re:Taxpayers shouldn't be bailing out any of these (Score:5, Insightful)
A lot of the people complaining show no comprehension of the economic crisis and what a bailout is. Let's backup for these people.
First off, we are in a *liquidity crisis*. Basically, few people have both the money to loan and feel they can trust loans they'd give, since they can't trust the insurers who would normally insure the loans due to all of the toxic assets and failures. So, companies that would normally be able to get loans find that they can't now. Loans are critical in the business world. Especially for scaling up operations. Especially for small companies. Especially for high tech companies. Especially for capital-intensive industries, such as automotive. I.e., Tesla motors needs, needs, needs loans, but can't get them.
Tesla had been planning to undergo a massive scaleup to start producing their Model S sedan -- not mass-market prices, but in the much more affordable "luxury car" price range. To do this, they need to produce the car by the tens to hundreds of thousands per year. They had started scaling up, and then the global financial system cratered. They've since started *undoing* some of their expansion, laying off workers and closing offices. Now the Model S plans are on hold, and they're instead having to switch focus to becoming profitable on Roadsters alone. The crisis is throwing them back by years.
In a normal market environment, they likely would easily have gotten the loans that they needed. However, right now, only the government has the ability to make these kinds of loans. The government "bailouts" are loans, designed to fill in the gap for a financial system struggling to right itself. Now, one can argue that some of these loans are going to companies that will never be able to pay them back -- that we're pumping taxpayer money into bad investments that will fail anyways and forefeit on their loans when they collapse. But it's anything but a "giveaway", and it's hard to argue that the only companies that deserve loans are the few that can get them in our current crisis. And in the case of Tesla Motors, I think it'd be hard to make that "not deserving of a loan" argument at all -- especially concerning funds specifically earmarked for the advancement of clean technologies.
No (Score:3, Insightful)
Re:No (Score:5, Funny)
Counterpoint: Yes, we should be bailing them out.
This has been "completely unjustified point-counterpoint" theater. Tune in next week when we look at whether or not global warming is real. A preview
Point: Yes, it is.
Counterpoint: No, it's not.
Then, to avoid unemployment and crime (Score:3, Interesting)
How about this:
Take the money they are requesting and instead use it to fund the foundation of a brand-new, American-based, car manufacturing company. This new company will not only be able to hire all (or at least most of) the workers that the current ones lay off, but it will also re-introduce some competition in the industry (which, incidentally, is the lifeblood of capitalism).
That should both ease the economic crisis and help reduce the negative economic impact of the current auto cartel, while not re
Not Really (Score:5, Interesting)
Tesla's request was so they could design and build a much cheaper electric family sedan; i personally believe that it is a good investment even if the car costs 50k.
It seems unlikely that tesla will mass produce a car, but it does seem likely that they will be gobbled up by a larger company that will.
It would be money well spent
Comment removed (Score:4, Insightful)
Re:Not Really (Score:5, Interesting)
Frankly, it is his money, and my money, and everyone else's money. Welcome to a democracy. Going to war on my dime to the tune of $1 trillion+? That's immoral. Lying why we went and having tens of thousands of people die because of it? That's immoral. Lending half a billion dollars to a company that's jumpstarting the electrification of transportation? Well that's just good sense right there. So take your libertarian viewpoint to a country that cares.
Comment removed (Score:5, Interesting)
Re:Not Really (Score:5, Interesting)
If electric cars (or ethanol, or any other possible replacement for gasoline-powered vehicles) makes sense, it won't take tax money to get it into widespread use.
Bullshit. The market is manipulated by interests to make investing in renewable energy and electric vehicles infeasible. Price of oil goes up, investment in renewables and electric vehicles shoots up. Price of oil drops, investment dries up. An unregulated market is rarely the answer, as shown by the deregulation in the financial sector.
You may disagree with me, but I'm fairly confident as an American that the new US policymakers in play are going to make the correct decision to push electric and plug-in hybrid electric vehicles.
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Calling the financial sector unregulated is like calling purple a squirrel.
I think government regulation is, in many cases, going to be better than the alternative, but that particular example is just horrible.
Re:Not Really (Score:4, Interesting)
Poor regulation, not no regulation. You used the poor regulation to argue that unregulated industries can't work. There were billions of dollars of government funds sloshing around the mortgage market, and apparently, companies were acting as if they were going to get a government bailout if they screwed up (the mortgage money is germane, as a great deal of the risk that the CDOs were supposed to be backing was in MBSs).
To a great extent, the unregulated hedge funds did a better job than the regulated investment banks (whether what they did was particularly good for society is a different discussion). Some of them made enormous sums of money playing the fools in the CDO market.
Re:Not Really (Score:4, Interesting)
The "unregulated market" in the financial industry was hardly unregulated. Just ask Martha Stewart who spent time in prison for her "unregulated" actions.
The problem that created the current mess came from regulators who didn't step in and use the authority that they had to stop some of the practices that caused huge problems, and a congress that pushed these regulators into give "easy credit" to new home buyers.... particular in congressional districts and constituent groups that favor certain... er... political viewpoints.
It is particularly telling that the congressmen who are demanding regulatory reform are the ones that largely caused the current mess in the first place through specific laws and other political pressure on the regulators to make the risky loans they are complaining about in the first place.
I think throwing tax dollars into the economy in this way is a waste of tax dollars down into a giant economic black hole that will gobble everything up with it, but if they are going to throw money around in this manner they should at least be consistent and not favor one company or group of individuals over somebody else. It isn't like Tesla is asking for the same size of a loan that GM wants.
Re:Not Really (Score:5, Interesting)
I live in Manatee County, Floriduh, one of the places Real Estate Madness hit hardest and that has, hence, been hit hardest by its end.
I do not recall seeing a whole lot of poor and/or minority taxpayers pulling mortgage frauds in order to buy little houses for themselves in not-great neighborhoods like East Bradenton.
I do, however, recall seeing lots and lots and lots of speculators and slumlords, the vast majority of them good white Republicans, bidding up the prices on little working-class houses to the point where none of the people who actually do the Real Work (trash collection, policing, teaching, retail sales, etc.) could possibly buy them. And oh weren't those white Republicans just so proud of the Free Market System and big on boasting about how much money they were making and on laughing at the suckers who actually worked at jobs like teaching or writing for newspapers or cleaning the streets or doing carpentry instead of being Investors, as if Investors were the highest possible form of life and should be bowed down to by all others.
'Course then a local mortgage company called Brasota went broke because it was essentially a ponzi scheme -- and shockingly, it was not run by poor and/or minority working liberals but primarily by (I know this is hard to believe) Rich White Republicans, hardly any of whom lived in the neighborhoods where they loaned mucho bucks to "investors" who didn't live in them, either.
And some local banks have failed, and a lot of local businesses, and now all the Rich White Republicans who ran their ponzi schemes and created their silly tulip-bulb bubble, except with houses, are running around blaming Democrats and liberals who thought that, just maybe, it might be a good idea to stop Rich White Republicans from discriminating against poor and/or minority workers when it came to making home loans.
The CRA (Community Reinvestment Act) that is being blamed by the Rich White Republicans for the collapse of their house of cards was all about ending discrimination in mortgages. Those Free Market Rich White Republicans had long had a bad habit of happily approving loans for white people in white neighborhoods while denying loans to black people in black neighborhoods even if the black people happened to have more stable jobs and wanted to borrow less than their white equivalents.
Listen, Rich White Republicans (and libertarians/Somalians and the rest of your crowd), if you want to see who created the current economic crisis, get a mirror and look in it. Don't keep trying to blame your problems on the blacks or the Jews or the liberals or whatever other group you're in the mood to victimize this week. It wasn't a "homosexual agenda" that created the obviously-insane (and unregulated) derivatives market, and it wasn't pro-choice agitators who ran the rating companies that assigned silly-high values to "bundled" mortgages.
Y'all ran our country for a good while, and basically you screwed it up big-time.
Quit whining. You had your chance. A lot of you got rich, and many of you will stay that way.
But don't try to pass your failures off on others. Man up, and face the fact that most of you got most of your money from some sort of scam, and that you have no right to complain now that you've been caught out.
And now, I need to get back to work. No government bailout for the likes of me, y'know.... GM, Ford, Citi, Chrysler and maybe Tesla -- and one can hope perhaps some other innovative car companies and a whole lot of "financial service" operations will get money. My tax money. Sucks, don't it? But otherwise, I suppose things might even be worse.
Can't win for losing, can we? (sigh)
Re:Not Really (Score:4, Insightful)
First of all, you have no stinking clue as to what political party that I tend to vote for nor have participated with in the past. It doesn't matter here and that is irrelevant anyway.
The "ponzi scheme" BTW had little to do with the actual housing market itself. Something like 95% of all mortgages or more have been solid investments and are loans that likely should have been made. It is that 5% of the loans that were made that likely shouldn't have been made in the first place.
Where it turns into a pyramid scheme is first where the assumption was that housing prices would keep going up and up without limit. A whole lot of people in the 1920's thought the same way about the stock market BTW.
Where it got ugly, and what has been a toilet flush to the national economy, has to do with all of the insurance, insurance derivatives, and some very exotic "marginal" buying that took place on top of these collateralized mortgage obligations [wikipedia.org]. It wasn't even the CMOs that failed, but how they were packaged.
Taking a page from the risky borrowing that took place in the 1920's, these "investors" borrowed "on margin"... but instead of in the stock market they pushed into real estate instead.
Any body with a damn clue that read the history of the 1920's should have seen this coming like an asteroid ready to hit the Earth. This was even reported on by several television news networks and in financial pages about how risky this whole thing was.... yet nobody stepped in.
BTW, in terms of those congressmen that turned a blind eye here.... it was both Democrats and Republicans that screwed up here and I blame both political parties equally for this massive screw-up. Neither John McCain nor Barack Obama were clean on this either, and I'll point out that Obama in particular had so much filthy "white republican money" going his way in the form of "campaign donations" that he certainly can't claim to be innocent of this mess.
Also, I'll note, I didn't expressly note what "constituency groups" were involved in this mess, as it was different for each area of the USA. As long as the money kept going to the political donation accounts of potential and current political leaders, those politicians stayed out of the mess. Some places I'm sure it was "rich white republicans", but I know for a fact that other "minority" groups were encouraged in a variety of ways to borrow on a house without any real reason to believe that they were ready to make payments.
It is these "poor folks", frankly, that are getting the short end of the stick on all of this. With trillions of dollars worth of money being pulled out of the world economy, these folks who signed up for these risky loans only to have the housing market yanked out from under them are having to pay the bill. Thanks to legislation passed by a Democratic Congress that has virtually eliminated bankruptcy as an option for middle-class folks, these people who borrowed this money are going to keep paying and paying through the nose for this debt even after they are evicted and their house is foreclosed, especially when they discover that their "mortgage insurance" is worthless.
As a homeowner myself, I have seen far too many of my neighbors get screwed over by the banking system and seriously taken advantage of.
Still, while the collapse of the housing market may have been the trigger here, that isn't why we are in the dire straights financially in the world today. It is all of the other garbage that was piled on top of mortgage industry expecting it to continue to grow when in fact it didn't.
JCRs Theory of Transportation! (Score:3, Insightful)
Government run mass transit systems that are far more efficient than any other mode of transportation: problem.
Destroying efficient transit systems and replacing with inefficient road systems, finite and domestically unavailable energy sources: solution!
Government development of electric vehicles to salvage the free market's mistake of investing in road infrastructure: problem.
Free market solution of continuing to produce technology that is destroying the environment and our economy: solution!
Ask any of his
Re: (Score:3, Insightful)
The more regulated an industry is, the greater advantage there is to the largest companies in that business.
Negative again, Will Robinson. One of the primary functions of modern market regulation is to prevent monopoly consolidation of power in said market. Virtually all large markets inherently tend toward monopolization since there are massive competitive advantage associated with economies of scale and consolidation of cash and capital. This, of course, is because there is no profit to be made in a
Re: (Score:3, Insightful)
One of the advantages of tax money, is that it can be used to develop technologies that will then get used by *many* others. It can jump start timelines that don't necessarily make sense to others. It can provide competition to private enterprise which has positive results in quality and price. This can be very important when a widespread commodity goes from plenty to scarce in a very short period of time.
Government in and of itself is not a solution, but neither is the free-market.
Classically the free
Re:Not Really (Score:4, Informative)
Fine, then just don't screw over Telsa by throwing tax dollars at the other auto companies either.
It is all or nothing. Why should the government get to select some companies for its largess just because they are being managed far worse than a small California start-up?
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Re:Not Really (Score:5, Interesting)
Contemporary libertarians remind me of children who never learned to share. Or more on point, people who never learned the difference between possession and ownership.
John Locke, who was one of the first to defend property rights, required that privatizing natural resources required that you leave "as much and as good" for others. He recognized that allowing individuals to monopolize particular types of property would be disastrous. Ironically, monopolies are exactly what would result if contemporary libertarians were to succeed at achieving the "free" markets they desire.
Regarding "your" property. While you happen to currently possess lots of it, it's not clear that it is necessarily yours. Given the history of property acquisition in the US, I'm guessing it probably isn't. Do you currently possess land? Likely that land was owned by native Americans before it was stolen by someone. That money you "own"? There is a good chance it was acquired by someone at sometime through some practice that would void their right to property (recall the 20s, slavery, theft from natives, war, etc.).
Personally I would be surprised if even 10% of the stuff you currently possess isn't tainted by some action in the past that would void one of the previous "owners" right to property. Which, according to Locke, voids your right to property as well since the object is currently the property of the person from whom it was stolen.
Comment removed (Score:4, Insightful)
Re:Not Really (Score:4, Informative)
Natural monopoly [wikipedia.org], network effects [wikipedia.org], and economies of scale [wikipedia.org]. Read them, then see if you can still say that with a straight face.
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The ideal free market is as impossible as an ideal gas or a complete vacuum.
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Actually, no. GP sounds like someone who understands that human civilization is built on the concept of the society, and every successful society is built on mutual cooperation and sharing to some degree. So far, in terms of both social justice and overall efficiency,
Re:Not Really (Score:4, Interesting)
If you can't figure out for yourself that taking money by force is immoral, I really don't think I can help you.
-jcr
If you don't think you will have to compromise to live in any modern society, I don't think you can be helped, either.
In another thread you state, "Taxation is moral only to the extent that the revenues raised are used to secure our rights. As soon as government steps beyond the powers that we have granted to it, it is immoral." In more civilized societies, people believe that all of it's citizens have a right to health care, education, as well as equal protection under the law. If you live out on a country road that serves only your family, I am paying for it. Likewise if I live in a city being choked by pollution, you pay for studies on how to lower that pollution. This is why all modern nation states are doing so well - they operate on the very fact that free markets do not work, because the free market lives in a fantasy land that begins and ends with the phrase, "all else being equal." Libertarianism and communism have good ideas, but like all ideals, they are more or less useless in reality.
In this case, a private company is seeking public money to develop technology, and I actually agree with you that it is immoral, but only because any company that receives public subsidies should be transparent and owned by the people who subsidized it. If we want to publicly fund the development of an electric car, since no private corporation is willing or able, I don't see a problem with it.
The reason the US transportation system is so bad is because our mass transit systems, which were unfairly efficient in the eyes of auto companies, were destroyed. A single rule from CARB, decried as impossible by those same auto companies, produced electric vehicles ten years ago that were viable options then and still are today. Once the board was filled with business friendly and socially unconscionable interests, the rules were repealed, the cars were destroyed, and the battery technology from the EV1 was bought and buried by Exxon Mobil.
Comment removed (Score:5, Insightful)
Re: (Score:3, Insightful)
Re:Not Really (Score:5, Informative)
Yes, obviously. You can confirm this by perusing the constitution. You will not find any authority given to the federal government to spend tax money on promoting technology other than to grant patents.
Yes, but then there is plenty of scope for this sort of spending to fall under the general welfare clause, and thus be permissible. It is a question of exactly what constitutes the "...general Welfare of the United States", and that is certainly not the clear cut black and white argument you suggest. Spending such as this has been deemed to fall under the general welfare clause for quite some time, with no successful challenges made. You're welcome to try and challenge it, but I suspect you'll fail. Furthermore, even were you to succeed, I expect that congress would have little trouble passing a constitutional amendment the next day to explicitly grant the power for spending along these lines; there's certainly sufficient support. For all intents and purposes it is constitutional.
Re: (Score:3, Interesting)
Re: (Score:3)
When was this election when I got to vote on individual federal expenditures? Hell, no congressperson that I've voted for has ever been elected.
Yes. (Score:5, Insightful)
Who else is going to improve the technology? If it was one of the companies already in the industry, it'd be done by now. Don't give the entrenched guys anything. Give it to new companies.
Just because the rich get it first doesn't mean we won't get it, too. Look down at the device under your hands as you flame me for proof.
More than all of Detroit combined (Score:5, Insightful)
The best way to develop the technology and bring the cost down to something affordable is to have it in production. And right now Telsa is producing 15 MORE zero emission cars a week than all of the Detroit automakers combined.
Re: (Score:3, Interesting)
They aren't really zero emission. They are just moving the emissions down the line, which is good in that it gives you more flexibility in how you generate the electricity, but could be extremely bad if you pick the wrong method.
If its coming from hydroelectric, solar, wind or nuclear you might say they are zero emission, though nukes are emitting some fairly nasty radioactive waste out the back end and some pretty nasty waste at the front end to produce the fuel if its coming from enriched uranium.
If the
It's more of an investment (Score:4, Insightful)
Tesla may not sell cars that everyone can afford today, but just by making cars, they are assumedly building on their ability to lower prices in the future.
As long as the money goes toward R&D, it's an investment in our future which I would support even if the other Big 3 were't going bankrupt.
Re: (Score:3, Interesting)
Will this R&D make these cars affordable to people in China or India? No. Will R&D make zero emission power plants affordable to China and India? No. Will the cars if, made better and mass produced, have any impact on global emissions? No.
So what exactly is the point of giving money to a company that markets and sells guiltlessness to rich people in rich countries?
Mischaracterized (Score:5, Insightful)
In addition, Tesla is continuing to work to engineer a pure electric car for the masses. This is where most of the money would be applied. It's not to bail out the roadsters already being built/already on order.
Plus, the established auto makers research is primarily still into improving ICEs, which is inherently, horribly inefficient. We've had over a hundred years of research and development into improving the ICE and it's still AT BEST only 25% efficient. We don't need any more ICE development, thank you very much. Considering that the Tesla roadster gets 4 times the fuel efficiency as the best ICE, the money would be applied exactly as it is intended (something that would probably not be the case for GM and company).
Lastly, if we're talking about bailouts, why should taxpayers bail out the Big Three? Their officers are responsible for pitifully shortsighted business decisions for the last 30 years, culminating in the current state of the US auto industry. If we reward businesses for bad business decisions, what's the incentive to do better? Let them be bought out by Toyota, et al. Good riddance, I say.
Re: (Score:3, Interesting)
No one gives a damn about efficiency. Sure, given equal performance and convenience, most people will choose the more efficient option, but the performance and convenience damn well better be equal.
The point of bailing out the big 3 is to slow down the rate at which they dissolve, giving the 3 million people that are nearly directly dependent on them for employment more time to find other jobs, retrain or die. The thought is that the ongoing inefficiency is less costly than the other way round.
Re: (Score:3, Interesting)
The point of bailing out the big 3 is to slow down the rate at which they dissolve, giving the 3 million people that are nearly directly dependent on them for employment more time to find other jobs, retrain or die. The thought is that the ongoing inefficiency is less costly than the other way round.
I can see this argument, but I doubt that's why government is bailing them out. I think it's a combination of wanting to look like they're doing something for constituents and brokering resources for special interests. Personally, I think it's better to just pull the plug. Sure it'll be a bit difficult for the three million people, but collectively they'll be doing more productive work.
Re: (Score:3, Insightful)
And taking money from other productive enterprises to do so and causing unemployment in a 1000 other areas.
Re: (Score:3, Interesting)
Re:Mischaracterized (Score:5, Informative)
If you used that same gallon of gasoline to power a generator to charge your electric car, you wouldn't get any more efficiency--the opposite, in fact, due to losses in the conversion and storage process for electricity....not that they're so vastly more energy-efficient than gasoline cars (because holistically, they're not).
That is simply incorrect.
Even if 100% of the energy for an electric car is produced by oil burning power plants, you are much better off efficiency-wise than you are with an ICE-powered car. This is considering all energy losses involved, from the transportation of the fuel to the losses in the power lines to the inefficiencies in the batteries and motor. Large-scale generators are just that much more efficient.
Do two minutes of research next time before you post. Please. I have seen this myth debunked so many times, and I cannot believe it's still being repeated.
Re:Mischaracterized (Score:4, Insightful)
What the parent says is very true, but there is more too it.
Among other things:
1)The power plants are stationary and can hence employ heavier and more sophisticated effluent treatments, meaning that for the same amount of fuel consumed, the power station will emit less pollutants than does a car.
2)A few large power plants are easier to monitor for malfunctioning systems than millions of cars.
3)With power plants you can often utilize the heat that is left over for district heating. Since even the most efficient engines/turbines will be well below 50% thermal efficiency this can potentially double the fuel efficiency.
4)The higher efficiency from a power plant tends to correspond to a more efficient burn of teh fuel, meaning that the pollutants produced for teh same quantity of fuel burnt is less.
In addition there's of course many ways to generate electricity with very little air pollution. Including Nuclear, Hydroelectric and Wind power. Over here in Sweden virtually all our electricity comes from Hydroelectric or Nuclear power. Iceland uses geothermal extensively, France uses almost exclusively nuclear and Norway uses mostly hydroelectric. Denmark gets substantial amounts of its electricity from wind. As I understand it the US has fairly diverse weather patterns and geography so you guys should be able to utilize Wind, Hydro, Solar, Geothermal and obviously Nuclear. The only reason you're still on Coal is that it appears cheaper when you fail to consider the secondary costs associated with all the crap it spews out.
Re:Mischaracterized (Score:5, Informative)
Something like a 25% efficiency is the maximum possible allowed by thermodynamics.
Not really. Combined cycle gas turbine plants can generate electricity at efficiencies close to 60% (and even higher if the waste heat is used for cogeneration). However, most electricity is still produced in older coal plants with efficiencies closer to 30%.
Woa woa, let's step back (Score:5, Interesting)
Should taxpayers back car makers first of all. Propping up failing industries with cash is like trying to fight gravity by throwing things up in the air. Should productive people pay for the calamitous ruin produced by government backed union thugs? So politicians bought michigan votes and now it's time to pay, only the payers will be the people living in the US. Uh uh.
Should we pay for the cars of the wealthy... ooooooh the wealthy. Yeah right, this is about the wealthy. Wait, no. Actually this is about the fucking Marxists who believe in unions, who believe in a socialized banking system.
Taxpayer should not back anything, and that includes the most bankrupt and morally corrupt company of all, the US government. Who will bail out the US government? Ponder this.
we shouldn't be bailing any of them out (Score:5, Insightful)
We shouldn't be bailing out any of the automakers, but since we are wasting the money anyway, I would greatly prefer the money to go to companies with *vision* rather than to companies that will waste the money making hybrid SUVs.
Spreading the wealth (Score:5, Funny)
many of which have gone to the Valley's billionaires and centimillionaires
Usually, a centimillionaire only has enough cash to buy a used car. Making this high-end car available to these people sounds like a huge benefit to me.
Well . . . (Score:4, Informative)
Hooray for class warfare! (Score:5, Insightful)
Seriously, folks - this has less to do with protecting the Rolls Royces of this world, and more to do with encouraging alternate means of locomotion.
Where would you rather give your money (if you're a US taxpayer, it is your money)... to a bunch of failing and backwards-looking automaking corps, or to a young and hungry company that is looking to change the very way we fuel up our cars?
Forget the politics - the Big Three are in thrall to a wage and compensation plan that is simply unsustainable and way above market value, no matter how the mathematics are applied. Not blaming the unions per se (the corps agreed to it, after all) but seriously - add it up yourself.
Coupled with the dragging and tooth-pulling required to get the likes of GM and Ford to go all-alternative (or to even jack up the fuel efficiency to something near what the competition has right now)? Why bother? They'll simply make a lot of noises about having changed their ways, and 10 years later they'll be right back in Congress again, begging for more money.
This may sound trollish, but screw that - let the innovators of this world get a leg-up, if we're going to be throwing around money in the first place. Let the collapse of the Big Three be an object lesson to those who think they're somehow entitled to continued existence just because they happen to be a big corporation.
Is this not the same question as: (Score:5, Insightful)
Should taxpayers back space stations only the rich can afford to visit?
Absurd Question (Score:4, Insightful)
Any new technology is initially going to be affordable only by the wealthy. If we say we are not going to subsidize R&D for products for the wealthy, we are saying we are not going to subsidize R&D at all.
1950's: Should we fund computers only rich people (Score:5, Insightful)
Metric money (Score:5, Funny)
A centimillion only buys one decitesla. I suspect the editors were referring to hectomillionaries, though with the recent gyrations in the market some of them may have dropped an exponent or two.
How about we slash oil subsidies? (Score:4, Informative)
Why not repeal the subsidies to oil companies? Some direct, some indirect. That would level the playing field, stop skewing the market and then we would see where alts to oil stand in terms of economics. Then a decision on what to do about alt energy and transport will be easier to make.
http://gristmill.grist.org/story/2008/3/6/122829/2907 [grist.org]
http://www.ucsusa.org/clean_vehicles/vehicle_impacts/cars_pickups_and_suvs/subsidizing-big-oil.html [ucsusa.org]
http://cleantech.com/news/node/554 [cleantech.com]
http://www.commondreams.org/news2008/0401-12.htm [commondreams.org]
http://www.progress.org/2003/energy22.htm [progress.org]
Liquidity (Score:4, Insightful)
I thought the whole bailout (not the one for the car industry, but rather about credit) was about liquidity. As anyone in the business world can tell you, liquidity problems can sink the best companies. In other words: You can have the best business idea ever, but if no one wants to invest in it you won't be able to make money. Same can happen down the line. If you have all you money invested, for example in machines, because demand is so high, and then one of you customers pays his bills late you could go belly up very fast.
Some banks even pull that on you in normal times. Maybe because they think they can make more money by selling your assets than by waiting for interest to come.
Now because nobody trusts anybody anymore in the credit industry liquidity has dried up. Many good businesses could fail because they are unable to borrow money. If one of their customers pays late ...
Tesla says they have orders for years to come. Maybe they have a very sound business, but still have problems getting money because of the banks.
Re:Liquidity (Score:5, Insightful)
Then the solution is to give them loans at the going rate of interest. Not low-interest loans, which are really a handout.
Absolutely Yes, Bail Manufacturing Out. (Score:3, Insightful)
Yes, the USA should invest in manufacturing and in particular, manufacturing for better technologies, and at a national level. It benefits the workers, it benefits the rich, it benefits a country whose sense of well being is made by being self sufficient in both the goods it produces and energy that it uses.
It's easy to demonize the rich, but history suggests caution. In 1993, as part of the Clinton economic recovery plan, Democrats raised taxes on luxury items. What they discovered is that they threw out of work quite a number of not-so-rich custom craftsmen, artists and workers that did things like make $2000 end tables, boats, and jewelry. Woops. The luxury tax was quickly repealed but the symbol of the small business owning craftsmen going belly up inspired middle America to elect Republicans in droves in 1994.
The whole "bailout" for car manufacturers is about retaining the skill among the workforce to create manufactured products. Clearly, Tesla is forging ahead and trying to build all electric cars. While only the rich can afford them now, if they are successful, perhaps other people will too in the future. I know Elon Musk is a self promoting douche, but, he is building the damn car and I bet he's got a lot of good people working for him.
I think the bank bailouts are far worse than any detroit bailout. Has anyone else ever bothered to total up the cost of the bailouts to banks versus the cost of the mortgages actually supposedly bad? You'll not be too surprised to find that we've already written out enough money to buy -all- of the subprime mortgages....but, why is anyone being foreclosed on?
Computers Were Once Only For The Rich (Score:5, Insightful)
Once upon a time, computers were the size of rooms and could only be afforded by governments and very large corporations.
Yet, after half a century of investment by the British at places like Bletchley, the US on ENIAC and the Third Reich on IBM products... plus things like the government funded ARPANET, we now have computers for everyone, internet for everyone, medical and scientific research advancing as people are capable of helping fold proteins or search the stars in their own homes.
Yes, right now, a Tesla roadster costs a lot of money. But, by investing in the technology, by establishing a market, by drawing interest, it won't do in ten or twenty years time.
Pretty much every invention that's improved human life or reduced our burden on the planet has been expensive at first. But that's never yet been a good reason not to help advance things up front, knowing it'll trickle down many times over, over time.
Re:no (Score:5, Funny)
I don't know how it works in the USA, but here in Canada we don't measure electricity in gallons.
Re:no (Score:5, Funny)
It's the energy you can get from as many 9v batteries as you can fit in a gallon milk jug. It's about 4% smaller than the imperial electrogallon, which uses a gallon-sized pail. You may remember the story a few years back when an MIT mathematician proved that an ideal battery configuration would hold two additional batteries, without stretching the jug, and we all had to recalculate our electricity bills.
But we stick with it, because we true Americans (as opposed to people in New York, California, and -- in a shocking turn of events -- Indiana) know that the metric system is the first step down the path to socialism.
Re:no (Score:5, Insightful)
You're a god damn twit. How do you think Tesla is paying for the R&D needed to make cars for average folks? Through selling cars that are marketed to people who don't care about paying $109K for a car.
Re:no (Score:4, Insightful)
That was my initial reaction. These things do have a way of coming down in price as more cars are designed and produced. In the long term the sports cars and race cars have a tendency to serve as a test bed for features that ultimately find their way into more affordable vehicles.
A couple of weeks ago I saw a mercedes with a bumper that had a pressure sensor to indicate when the bumper backed into something and a rear hatch which opened and closed by button. A decade ago I hadn't heard of those features in any car.
I'm not really sure how else this should work unless we want to either do without the advances or pay even more to have something that everybody can drive now.
Re:no (Score:5, Insightful)
My business partner and I both reserved '09 Tesla Roadsters. Why? Not because it's a hot car, or it drives like a rocket, but because we want to see electric car research pushed faster. And it was the next best thing to investing in the company. It drives me nuts when some fool comes out and says "Tesla can have help when their car is priced for the average person". They won't need help by than. They need help getting to that point.
Re: (Score:3, Insightful)
Nonetheless, until that point it is a distortion of the market to negligib
Re:no (Score:5, Insightful)
So helping General Motors to build a new hybrid Cadillac is going to be a better way for the government to throw its money around than letting Tesla be able to invest into their "Whitestar" vehicle that is targeted for around $50k for around 1/10th the cost that GM is asking for?
I don't get what you are saying here. This isn't Tesla asking for money by itself, but asking to be included with the other companies that also claim to be "American Automotive Manufacturers" and for the Feds to maintain a level playing field. Are you sure the feds should subsidize Ford and Chrysler at the expense of taxing Tesla out of existence?
Re:no (Score:5, Insightful)
Tesla Motors is in direct competition with General Motors and the Volt. Indeed, there are many places where GM executives have openly stated (including on 60 Minutes and other major media outlets) that they wouldn't have even started the Volt if it weren't for Tesla showing it could be done.
So tell me, why should GM get a special subsidy for building the Volt and Tesla be told to "get lost" and build their car on their own?
The $400m check isn't just a grant, it is a loan that must be repaid. What getting it from the government will do is provide basic capital to build the factories, finance the R&D, and get built the next generation of Tesla vehicles. Tesla even has the manufacturing facility picked out and some of the preliminary designs for that vehicle.
All that Tesla is doing here is to insist that they be treated as an American automotive manufacturer. If GM is getting the subsidy, why not Tesla as well?
Re:no (Score:5, Insightful)
I don't know about you, but it looks like Tesla is trying to push the costs down. Yes, right now, they are making a pretty pricey car. They next project will be a sedan which they're looking to charge half the price, which puts it in reach of a lot more people. If they can get a loan to push the development more quickly, I'd say they are at least as deserving as the incumbent carmakers. Hopefully the production scale-up will allow for more innovation in battery research, mostly in cheaper high capacity batteries.
Re:no (Score:4, Insightful)
A niche may be the best way to go, because no one in theu US needs a cheap NEW car.
That's too easy a market to undercut with USED cars. It's all about dollars per mile, so buying used and junking them when they go beyond economical repair makes great sense.
Re:no (Score:4, Interesting)
But Tesla isn't inherently a luxury model. It's only so expensive because the fundamental technology for this kind of car is so expensive, not because they wanted to make a car specifically for the rich market. In that sense, they're really doing what the very first car manufacturers were doing - first make something that generally works, no matter the price; then, develop the technologies to get the price down and expand the target market.
Re:no (Score:4, Insightful)
Ford didn't start out with expensive fancy cars that no one could afford, they changed the industry with a cheap car, built the base and then started making luxury models.
Tesla will be a niche, like Porsche, Lambo, Ferrari, Aston Martin are.
Actually - not quite. Ford's first models were not the industry-changing (if not world-changing) Model T. That comes several years later in Ford's history. And even the first Model T's weren't produced with the manufacturing technology that made it a historical icon. And it should be noted that before the Model T, there was also a very high-end luxury Model K in Ford's lineup. What Tesla is doing isn't THAT far out of line of what Ford did; introduce new technology to the public while using advances in technology (both product and manufactoring) to lower prices on future models.
When you compare Telsa to Ford, you have to look at the big difference in history. Ford entered a fairly young market with a technology that really didn't have an equivalent other than others producing similar technologies. That is, the automobile competed only with other automobiles. Telsa is entering a market with an automobile using a very different power system that has to compete in a market already saturated with conventional powered automobiles. Not only do they have to develop technology and come up with a profitable way to sell that technology, but they also have to capture the attention of the market and distinguish themselves from the conventional competition. Tough market. Especially when "electric car" has an emotional response similar to "golf cart" (and lets not kid ourselves - the car market is very much driven by emotion).
Will Telsa remain a niche? Sure - if they keep producing roadsters. But then... who would have seen Ford producing the Model T back in their early history of the Model A and Model K?
Re:RAISE THE GAS TAX! (Score:4, Insightful)
Given that poor people pay a higher proportion of fuel tax than rich people [wikipedia.org] fuel taxes are a good example of regressive taxation [wikipedia.org]
Re: (Score:3, Interesting)
Just because something is regressive taxation *does not* mean that it's a bad idea. Especially in the case of taxes designed to change economic incentives, the regressiveness of the tax is solidly a secondary concern - and one that can be easily solved by cutting income tax further for the lower brackets.
Comment removed (Score:4, Interesting)
In Feudal Bosnia... (Score:3, Insightful)
...They don't need to screw around with import taxes like common peasants.
They just raise their own salaries.