Elon Musk: great innovator, or biggest welfare schemer?

[gcgang]

Elon Musk's growing empire is fueled by government subsidies - LA Times

Article says Musk's companies have received $4.9 Billion in government subsidies.

Like Willie Sutton, go where the money is.


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[stepford]

I'm no more a fan of the cult of Elon than I was of the cult of Steve that preceded it, but I can't fault the guy for configuring his businesses to take advantage of government largesse. That's just taking advantage of the rules businesses in these fields play by - no different, save in scale, from the games of manipulating AGI to minimize tax and maximize subsidy that so many here play.

[eroscott]

Title: Tesla Pays Off Its $465 Million 'Loser' Loan
Tesla Pays Off Its $465 Million 'Loser' Loan - Businessweek

Quote:

Elon Musk’s “Summer of Revenge Tour” continues. His electric-car company, Tesla Motors, just cut the government a $451.8 million check, which means that Tesla has paid off its entire Department of Energy loan plus interest. “Following this payment, Tesla (TSLA) will be the only American car company to have fully repaid the government,” the company boasted (emphasis Tesla’s). Of all his recent moves, this one must be especially sweet for Musk. Critics have long taken swipes at Tesla and its all-electric hippieness for relying on a federal handout. The most public of such barbs arrived from Mitt Romney during the presidential debates, when he described Tesla as a “loser” alongside Solyndra and Fisker Automotive. <snip>

Title: Tesla repays federal loan nearly 10 years early
Tesla repays federal loan nearly 10 years early - May. 22, 2013

Quote:

The electric-car maker received the loan from the Department of Energy in January 2010, and it made its first payment this past December. That began what was supposed to be a 10-year repayment program, but plans have changed. Tesla (TSLA) reported its first quarterly profit earlier this month, and Consumer Reports came out with a review calling the Tesla Model S the best car it ever tested. Those two facts, along with a significant short squeeze, helped send the stock soaring to record highs. Related: Tesla's windfall from rival automakers Tesla announced last week that it would sell additional shares of stock, and that founder Elon Musk would make a new $100 million investment as well. The company said it would use some of the proceeds to repay the loan this week. "I would like to thank the Department of Energy and the members of Congress and their staffs that worked hard to create the [loan] program, and particularly the American taxpayer from whom these funds originate," Tesla co-founder and CEO Elon Musk said in a statement. "I hope we did you proud."

[daylatedollarshort]

I find him an interesting character. I like reading about him. He certainly thinks outside the box. I can't admire someone though who works employees so hard they can't have a life outside of work. He has five kids and works 100 hours a week himself. I personally wouldn't want to work for a company run by a workaholic, brilliant or not. A lot of the reviews for jobs at SpaceX describe very long hours and no personal life:

"If you want a family or hobbies or to see any other aspect of life other than the boundaries of your cubicle, SpaceX is not for you and Elon doesn't give a damn..."

Read more: What It's Like To Work For Elon Musk - Business Insider

Studies show working that much as actually counter-productive anyway.

If he doesn't take the tax credits someone else will. Why not him if he is not doing anything illegal. I do think he is shaking up how military contract are awarded and I like that part.

[eroscott]

I'm not a fan of that much work life vs personal life either but everyone working there is doing it by their own choice.

[samclem]

Quote:

Originally Posted by stepford I'm no more a fan of the cult of Elon than I was of the cult of Steve that preceded it, but I can't fault the guy for configuring his businesses to take advantage of government largesse. That's just taking advantage of the rules businesses in these fields play by - no different, save in scale, from the games of manipulating AGI to minimize tax and maximize subsidy that so many here play.

There may be a difference.
I've got no role in creating the tax code, and I actively opposed the creation of some of the giveaways in the tax code, ACA, etc. I still do. But once they are law, I abide by the law and arrange my affairs to harvest these things, to the degree it makes sense.
But if Musk and his company are taking an active role in influencing legislators and lobbying for the creation of these handouts/set-asides/subsidies, then he swoops in to get the money, that's ugly and not at all the same thing. That's plain crony capitalism. I don't know that he's doing that, but to the degree that his success is dependent on special deals rather than open competition in an unsubsidized free market, his true merit relative to other business leaders and "visionaries" will remain somewhat under a cloud..

[Lakewood90712]

"But if Musk and his company are taking an active role in influencing legislators and lobbying for the creation of these handouts/set-asides/subsidies, then he swoops in to get the money, that's ugly and not at all the same thing. That's plain crony capitalism."

A whole lot of businesses do exactly that. Ya, it's ugly , but SCOUTS has ruled that "Corporations" are "people", can fund unlimited amounts to PAC's and lobby politicians. Ugly , but completely legal.

Politicians and candidates will forever crow about how they will will change that, when elected / re-elected.

Constitutional amendment required to change it.

[samclem]

Quote:

Originally Posted by Lakewood90712 "But if Musk and his company are taking an active role in influencing legislators and lobbying for the creation of these handouts/set-asides/subsidies, then he swoops in to get the money, that's ugly and not at all the same thing. That's plain crony capitalism." A whole lot of businesses do exactly that. Ya, it's ugly , but SCOUTS has ruled that "Corporations" are "people", can fund unlimited amounts to PAC's and lobby politicians. Ugly , but completely legal. Politicians and candidates will forever crow about how they will will change that, when elected / re-elected. Constitutional amendment required to change it.

I'm not making a political point, and I'm not saying Musk is doing anything illegal. But to my way of thinking, an innovator who brings new/better products to the public and gains his reward by virtue of the decisions of customers to vote with their wallets is more worthy of our respect than someone who works the corridors of power to get pols to give him my money.

[ERD50]

Is it really either/or? Maybe he is both?

He's had too much success in really difficult and challenging areas to not be a great innovator, or a great leader of innovators.

-ERD50

[Lakewood90712]

Samclem , can you make room for an incoming pm ?

[Fermion]

Quote:

Originally Posted by daylatedollarshort I find him an interesting character. I like reading about him. He certainly thinks outside the box. I can't admire someone though who works employees so hard they can't have a life outside of work. He has five kids and works 100 hours a week himself. I personally wouldn't want to work for a company run by a workaholic, brilliant or not. A lot of the reviews for jobs at SpaceX describe very long hours and no personal life: "If you want a family or hobbies or to see any other aspect of life other than the boundaries of your cubicle, SpaceX is not for you and Elon doesn't give a damn..."

Jobs was a bit like this too.

Hey, if you want to land an apartment building on top of a boat in the ocean, you gotta work long hours....its what you do.

[daylatedollarshort]

Quote:

Originally Posted by Fermion Jobs was a bit like this too. Hey, if you want to land an apartment building on top of a boat in the ocean, you gotta work long hours....its what you do.

I got talked into working for a hot tech company with long hours years ago by a recruiter and hiring manager, when I was younger and more gullible. I lasted 3 months. The per hour pay wasn't worth it. Whenever I hear the words "premier" and "cutting edge" now, unless it involves stock options, I hear corporate marketing speak for "we don't have enough money to actually hire enough people so you are going to have low pay per hour".

[Texas Proud]

I think he is just like hundreds, if not thousands, of others who do the same....

ADM gets more money from the gvmt than Musk.... so do all of those defense contractors who do not seem to be able to make a good working plane without spending many multiple X of the original budget...

And to be fair, there are a lot of farmers who get most of their income from the gvmt....

[frayne]

Elon Musk was one of the founders of pay-pal, visionary electric car maker who bucked the status quo in selling his vehicles, founded a space company (not to mention trying to land and re-use boosters on a ship at sea) and is building a giant battery plant to supply homes and vehicles with electricity.

I like and admire someone who has a vision and builds things as opposed to shuffling papers around to make their wealth. Personal life aside the guy has some good old fashion cajones and an I don't give a rat's arse attitude of what anyone else thinks.

[clifp]

Quote:

Originally Posted by frayne Elon Musk was one of the founders of pay-pal, visionary electric car maker who bucked the status quo in selling his vehicles, founded a space company (not to mention trying to land and re-use boosters on a ship at sea) and is building a giant battery plant to supply homes and vehicles with electricity. I like and admire someone who has a vision and builds things as opposed to shuffling papers around to make their wealth. Personal life aside the guy has some good old fashion cajones and an I don't give a rat's arse attitude of what anyone else thinks.

+1
Oil Depletion allowance, Ethanol subsidies, accelerated depreciation, foreign oil production credit, railway land grants,auto and airline bailouts, the interstate highway system. And last but not least military contracts. I am hard press to think of any company in the transportation, or energy business that hasn't benefited tremendously from largess of government. This has gone back to beginning of the 19th century and while it has cost the tax payer a plenty, I think the benefits to society have really outweighed the cost.

To the best of my knowledge Intel has not built a factory for the last 30 years, where the state government didn't provide a generous tax breaking, typically and exemption for property tax for 5-10 year. I am sure that is the rule rather than the exception for any 1,000+ person firm opening a factory pretty much anywhere it the country and probably the world.

I think the guys who are shorting Tesla stock are getting a bit desperate.

[purplesky]

Quote:

Originally Posted by frayne Elon Musk was one of the founders of pay-pal, visionary electric car maker who bucked the status quo in selling his vehicles, founded a space company (not to mention trying to land and re-use boosters on a ship at sea) and is building a giant battery plant to supply homes and vehicles with electricity. I like and admire someone who has a vision and builds things as opposed to shuffling papers around to make their wealth. Personal life aside the guy has some good old fashion cajones and an I don't give a rat's arse attitude of what anyone else thinks.

But make no mistake. Elon Musk is funded by the American taxpayer.
Elon Musk would not be able to do what he does without the American taxpayer.

I agree with you he is doing great things. But not alone.

60 minutes did a story about his space program and 60 minutes did a terrible job of reminding its viewers that privatized space travel will still be funded by the government.

Corporatism is nothing new.

[Fermion]

Quote:

Originally Posted by purplesky But make no mistake. Elon Musk is funded by the American taxpayer. Elon Musk would not be able to do what he does without the American taxpayer. I agree with you he is doing great things. But not alone. 60 minutes did a story about his space program and 60 minutes did a terrible job of reminding it viewers that privatized space travel will still be funded by the government. Corporatism is nothing new.

I would rather pay SpaceX as a taxpayer than pay Russia for our space travel.

[purplesky]

Quote:

Originally Posted by Fermion I would rather pay SpaceX as a taxpayer than pay Russia for our space travel.

Either way our tax dollars for space travel go into a black hole.

Space travel is going to be a world effort. So I don't really have a problem with Russia being on our team. Its really about mankind. Not just individual nations.

[Texas Proud]

I do not remember which show I saw it on, but SpaceX has also gotten a lot of free info from NASA on designs etc... something that would have cost maybe billions for a company to figure it out on their own...

Now, this really cost the taxpayer nothing as they already had paid for that info and giving it away did not cost much....

[pb4uski]

He is probably the closest thing we have to Thomas Edison today, particularly since Steve Jobs passing.

I'm not sure if it is fair to count subsidies given to buyers of solar systems and electric cars as subsidies of Musk's companies, though the companies clearly benefit from them. Similarly, many of the stae and local inventives mentioned in the article are commonplace in business and not unique to Musk's businesses.