Fifth Element cosplayer Elon Musk would like the government to knock it off with the whole trying to pass climate legislation thing. His beef with the Build Back Better Act? Among other things, subsidies for electric vehicles. Thus, Musk continues a long tradition of what people in “the biz” call “pulling up the ladder.”
Musk’s comments came at Wall Street Journal’s CEO Summit when asked about the Build Back Better Act by Journal reporter Joanna Stern. She posed a hypothetical where President Joe Biden called Musk to ask what he wanted in the legislation that has passed the House but is currently being tweaked in the Senate.
“To be totally frank, no one at Tesla has brought up whether they care about this bill or not. … We don’t think about it at all, really,” he said before indicating he has, in fact, thought of the bill. “It might better if the bill doesn’t pass. The federal budget deficit is insane.”
If you are a big businessman like Musk, then running at a loss is bad. (Though strangely, his companies have been unprofitable even as his wealth has exploded. Funny that.) But for the federal government, which can literally print money, the deficit is merely a boogeyman that politicians and people looking to influence politicians can bandy about. The government’s balance sheet is about more than money in and money out.
Musk went on to call the electric vehicle and charging infrastructure subsidies in the bill “unnecessary.”
“Do we need support for gas stations?” he rhetorically asked. (Also for the record, governments subsidise gas bigly, both directly and indirectly.) “We don’t. So there’s no need for supporting a charging network. I would delete it. Delete. I’m literally saying get rid of all subsidies.”
So either Musk hasn’t thought about this bill and is talking out his arse or he’s thought a lot about this bill and is, from the sounds of it, losing sleep over it. The tech CEO has relied on government contracts and subsidies for all his businesses. SpaceX? Government contracts and subsidies. Tesla? Government subsidies and loans. Solar City? Folks, it’s subsidies. A 2015 Los Angeles Times deep dive estimated Musk received $US4.9 (A$7) billion in government subsidies, a number that has almost surely risen since then.
Let’s be clear: There is nothing wrong with subsidies! Supporting industries is a means of economic growth, ideally in sectors of the economy that are good for people and the planet. In the case of electrifying transit, that checks multiple boxes. We love a good, carbon-cutting subsidy!
Sadly for Musk, it’s too late to “delete” charging infrastructure subsidies, they were included in the bipartisan infrastructure bill already signed into law. With respect to EVs, Build Back Better offers $US7,500 (A$10,540) rebates for buyers and another $US5,000 (A$7,027) if the vehicle is made in a union shop. Tesla is not unionized and Musk is virulently anti-union. Major American automakers do feature large, unionized labour forces, though. It’s easy to see why the $US5,000 (A$7,027) top-up would piss off Musk even if, you know, unions are good for everyday people and democracy.
You know who else hates the EV subsidies in the Build Back Better Act? Sen. Joe Manchin. You know who gives the most money to Manchin? The fossil fuel industry. And what do that industry and Musk have in common? They’re both incumbents. Granted, the fossil fuel industry has a century-plus headstart in tying transportation to gasoline. But Musk’s company has a lead over other automakers in terms of tying it to electricity. Cutting off subsidies would allow Tesla to further corner market share, tying the fate of electrification to his company ever tighter. One area Musk would like to see the government invest is “better highways … In cities that are congested, we have to deal with extreme traffic, which I think is double-deckering freeways and building tunnels.”
He was conspicuously silent on public transit, a huge boon to local economies, transit justice, and the climate. But then, more roads — which would be a climate disaster as long as the internal combustion engine is still around — means more cars, which means more potential Tesla customers. And wait, that’s right. Musk owns the Boring Company, which relies on government contracts to make money.
“If we don’t cut government spending, something really bad is going to happen,” he continued. “This is crazy. Our spending is so far in excess of revenue, it’s insane.”
There’s that deficit talk again. But honestly, if Elon is so worried about spending exceeding revenue, I can think of a solution.