How Elon Musk's Growing Empire is Fueled By Government Subsidies 356
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.
Manufacturing buisness supported by government. (Score:5, Insightful)
Employing mainly Americans, manufacturing in America.
Re:Manufacturing buisness supported by government. (Score:5, Informative)
Re:Manufacturing buisness supported by government. (Score:5, Insightful)
In addition, we should require that drillers and piping companies be held responsible for their actions. Yet, we do not.
this is exactly what subsidies are for. (Score:5, Insightful)
Subsidies are policy implementation devices. When people take the subsidies under the condition the subsidies are offered the result is that something the government wants to happen happens. Theoretically its an inexpensive way to get things done without the government doing it and assuring private investment in the outcome. (so there's vested interest in successes and usually commercialization).
Just because one guy happens to feed at the trough isn't a problem neccessarily. It could be. But that's why you have oversight.
Another way to describe this (Score:5, Insightful)
Another way to descript this would be:
Elon Musk structures his businesses to support government priorities.
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but but "muh markets".
for the people who'd rather we loose our jobs to the chineese.
Re:We the taxayer get screwed. (Score:5, Informative)
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 [shareholder.com]
But go ahead and keep undermining your arguments with such unnecessary hyperbole, mister Anonymous Coward.
Re:We the taxayer get screwed. (Score:5, Insightful)
and they go out of their way to hire veterans: http://www.military.com/vetera... [military.com]
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... [teslamotors.com]
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
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fuck your crack whore mother
A truly brilliant riposte. The wit astounds!
Re:We the taxayer get screwed. (Score:5, Informative)
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.
Re:We the taxayer get screwed. (Score:5, Insightful)
And that comes to what, over $360,000 per employee?
Here is the problem. Most of this subsidy money is not given to anyone or any companies. It is a waiver of future costs that wouldn't likely be collected anyways. Some is in the format of direct payment but those are generally to share the costs of getting people and companies to do what they wouldn't do already. So its pointless to really argue about it outside of whether we want someone or companies to act in certain ways while remaining free people.
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Lol.. if that was all, you might have a point. Why do you believe the subsidies have stopped and no more will occure over the life of the company?
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How is it 'growing'? Tesla's factory runs under capacity and has been doing so since 2012.
http://en.wikipedia.org/wiki/T... [wikipedia.org]
"In December 2012, Tesla employed almost 3,000 full-time employees.[3][26] By January 2014, this number had grown to 6,000 employees."
"Number of employees - 10,000 (Nov 2014)"
3000 to 6000 to 10000. Nope, that certainly doesn't sound like growth. But just in case any of those words were too big for you, here's a graphic:
http://www.statista.com/statis... [statista.com]
" In August 2014 the company announced it, in conjunction with Panasonic, would establish a "gigafactory" battery manufactur
Re: We the taxayer get screwed. (Score:5, Informative)
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.
Re: We the taxayer get screwed. (Score:5, Insightful)
...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.
Re: We the taxayer get screwed. (Score:5, Interesting)
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.
Re: We the taxayer get screwed. (Score:5, Interesting)
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 [slashdot.org] 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.
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Re: We the taxayer get screwed. (Score:4, Informative)
That bottom 50% not paying anything in taxes is understandable if you look at the amount of wealth it represents in this country.
Graph here:
http://www2.ucsc.edu/whorulesa... [ucsc.edu]
"It is widely believed that taxes are highly progressive and, furthermore, that the top several percent of income earners pay most of the taxes received by the federal government. Both ideas are wrong because they focus on official, rather than "effective" tax rates and ignore payroll taxes, which are mostly paid by those with incomes below $100,000 per year."
http://www2.ucsc.edu/whorulesa... [ucsc.edu]
Wealth, Income, and Power
by G. William Domhoff
Do Taxes Redistribute Income?
Adam Smith, who wrote Wealth of Nations, said that those who have benefited more from society should pay a greater proportion of their income for the costs of running that society. In other words, Smith advocated progressive taxes.
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However, two points:
Re: We the taxayer get screwed. (Score:5, Insightful)
Having rich and poor is an inevitable feature of any civilization that has ever existed or ever will exist. The societies that try to eliminate it (namely, communists) end up destabilizing quickly.
You mean, like Canada, that slum-ridden cesspit to the North?
Try dialing down the dogma a fraction, and accept that there are reasonable compromises that provide reasonable mitigation to the worst aspects of any economic system. You might find that it is indeed possible for sober public investment in private enterprise not only to work, but to work well. There's a whole sub-discipline in economics devoted to the study of it. Yes, there are downsides to Public/Private Partnerships (it even has a name!!), but with the proper checks, they can sometimes work better than either a purely public or a purely private undertaking.
Re: We the taxayer get screwed. (Score:5, Insightful)
"Quite frankly, government subsidies for these are a waste until the fundamentals line up."
Are you suggesting that the government should only be subsidizing mature industries?
I am not a fan of any subsidies . . . especially for mature industries. If the economics do not line up for a mature industry then the industry creates a net economic drag on the economy and should not be subsidized.
The entire point of a subsidy should be to test and support the viability of new ideas that have the potential to create large economic benefits in the future. Instead what we have is a 100 years of subsidies for a handful of companies while pointing the finger at peanuts that should fundamentally change the world if allowed to compete on a level playing field.
Re: We the taxayer get screwed. (Score:3)
Tesla has a supercharger that charges 80% in 40 minutes or less. Likewise, their batteries are not only, the cheapest per KW, but also lasting the longest of any li-ion in vehicles.
Spacex is working towards landing first stage as well as the capsule and re-using it quickly. Nobody had a pusher abort system that can be used for landing on earth as well as mars and the moon. In addition, nobody has done a full stage methane engine, but Tesla is testing theirs now.
now, we have solar
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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.
Yeah, just look at all those technicians sitting around in a back room. [youtu.be] I think you're mistaking the unibody assemby as representing the assembly of the entire car. It's standard for that to be mostly automated because of all the welding. But after it's painted, assembly is still mostly a well choreographed manual exercise. It just doesn't look as sexy on TV because people don't appreciate the organizational precision involved.
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Whether the consumer pays directly the entire cost of the panel, or pays indirectly through taxes, it still means we're paying more, a net loss to society.
How so? A net loss to the consumer sure. But to society? That's a stretch. You would need to assess the supplier chain to find out where all of that money ends up to make that determination. You can bet if you buy foreign made panels, almost all of that money is leaving society. If you're paying a premium for locally made panels, I would at least be willing to take the gamble that the majority of that money stays within our society.
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1) 90s was about the internet being opened.
2) the only real manufacturing that we lost during the 90s was steel.
3) it was during 00's that America lost the majority of our manufacturing, due to tax codes that W/neo-cons passed (and is STILL on the books).
4) manufacturing is REQUIRED by nations to keep designs going.
What is needed is to remove subsidies for OLD technology and then have limited time subsidies for any new tech that we want to develop. For exam
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Scraping the bottom of the barrel. Obama care has been a huge success, and you're still whining about a web-site that took too long to get right. A web site that was produced by private sector contractors that failed.
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And what if the segment you're entering into is _all_ subsidised by the government, and you do it for less subsidy or payment, reducing cost?
"Why do you rob banks?" (Score:5, Funny)
"Because that's where the money is."
Duh....
Re:"Why do you rob banks?" (Score:5, Informative)
$4.9 billion? That's nothing compared to the Koch brothers. [greenpeaceblogs.org] They got more than twice that amount.
I'll pay for subsidies here any day. (Score:5, Insightful)
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.
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If only the Middle East were our main source of oil... it isn't [eia.gov].* And even with the shift to electric vehicles and solar power, petrochemicals are still vitally important industrial feedstocks, and thus a stable Middle East is still of prime economic interest to the West.
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"Stable Middle East" - How did the Iraq invasion help that goal? Since the '73 oil embargo, how much has it cost the USA in lives & dollars to "stabilize" the Middle East?
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If only the Middle East were our main source of oil... it isn't [eia.gov].* And even with the shift to electric vehicles and solar power, petrochemicals are still vitally important industrial feedstocks, and thus a stable Middle East is still of prime economic interest to the West.
If we quit burning oil/nat gas, America will not need to import any oil. We have plenty for all of the other uses.
Re:I'll pay for subsidies here any day. (Score:5, Insightful)
To an extent that's where we are now for electric vehicles, especially those that wish to travel outside of their home range. Homes themselves need charging stations with heavier gauge wiring to most effectively charge the cars, and we need service points with chargers to recharge the cars on roadtrips. That means there needs to be enough electric cars on the road, using similar enough technology, to justify the cost to install the charging stations both at home and in public. This is a snowballing effect, the more places to charge, the more that electric cars become viable to the average car buyer, and the more electric cars on the road, the more people and businesses willing to make the investment for electric car infrastructure.
In the end, we shift the primary source of automotive pollution from the end-car to power generation, aka, power plants. Sure, there are still fossil-fuel power plants that pollute, but it's a lot easier to regulate hundreds or even thousands of power plants than it is to regulate hundreds of millions of cars, and unlike cars, power plants have found themselves subject to end-of-life if they do not meet increasingly strong emissions standards, while cars only have to meet the standards in-effect when they were manufactured, some as far back as 1967. Suddenly the car owner no longer as to go wait in line for a Department of Environmental Quality sniffer test or has to worry about the financial cost to simply make the vehicle clean enough to pass such a test.
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The subsidies you want to pay, then, is to the frackers, and shale oil extractors. Not to some dot.bomb Paypal wiz kid who's the new Paul Allen.
LOL. Uh, no. We need to STOP subsidies on oil AND Solar TODAY, along with changing the subsidies on Wind, other AE, EVs, Energy Storage, and nat gas use in Commercial Vehicles.
By stopping subsidies for oil and in fact, raising the gas/diesel taxes so that they support the roads properly, it will encourage Americans to move off ICE.
Likewise, we should stop the EV/hybrid subsidies, and instead, simply offer up a limited time subsidy based on range. Hybrids keep us tied to oil. And EVs like the leaf will act
Tesla Is Good For All (Score:5, Insightful)
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.
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Go away coward, no-one cares what anyone without the courage to log in says.
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I don't agree at all. Until one of his products becomes a mass market conusmer item and not a niche play, then I'll come to your opinion. But so far none of his products have shown any mass market appeal and can't even compete in their niche without government subsidies.
So it goes for virtually any new product.
That's one thing the rich are actually good for, buying the sometimes dubious new inventions and supporting product development until things are mature enough for mass market.
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you are aware that affordability is sort of a huge part of mass market appeal, right? When I go out shopping for a new car, Tesla is not on the radar as it doesn't appeal to me because it costs way too much. Similar to how Ferrari doesn't really appeal to me, awesome products, but way too expensive.
Partially.
Tesla costs too much because the tech is new and somewhat experimental, but if rich people keep buying them the tech will mature and costs will come down until it's mass market.
Ferrari is different in that it's a luxury brand, so it will always be good quality but more expensive. I'm sure it drives technology forward as well, particularly is design and manufacturing, but maybe not to the extent of a Tesla.
Re: Tesla Is Good For All (Score:5, Insightful)
"On" each car, or "for" each car?
"On" makes it sound like their marginal costs are negative -- that, literally, producing one more car increases their losses by $9K. Were it "for" each car, then they're losing money only after fixed costs, R&D, etc. are taken into account.
That latter makes considerably more sense -- folks can legitimately decide to back a company investing in itself rather than taking out a profit; indeed, Amazon has done that for years.
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You have the right to not agree. I even joined the military and wholeheartedly support your disagreement.
That still doesn't make you right.
Some products are truly game changers. Airplanes were exorbitantly expensive until the became commodity items. So were the early cars. As were trains. Sewage systems. Libraries. Schools. The list goes on.
A Tesla roadster initially cost $109k for two seats and 200 miles per charge.
Today you can get a Tesla Sedan for $70k, four seats, and 240 miles per charge.
In tw
Actually... (Score:5, Interesting)
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... [theguardian.com]
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
Re:Tesla Is Good For All (Score:5, Insightful)
"Mass market appeal" - he's already achieved that with the Model S. It may be too expensive for most but they sure as hell want it. And he's gotten lots of competitors talking smack about making a "Tesla-killer" which is something I've never heard them say about the Volt or the Leaf.
"can't even compete in their niche without goverment subsidies" - then you must be PISSED about the government bailing out established auto companies.
http://useconomy.about.com/od/... [about.com]
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DO you really think that 7K makes a difference to the average buyer of a Model S? Nope.
However, where the model S has sold, it HAS cut the sales of Lexus, Caddies, Porsche Panamera, etc. IOW, cars that are of the same class are way down in sales. And with the Model X coming in 2 months, it should kill off sales like Escalade, along with the Cayennes, etc.
Within 2 year, the Model 3, at a price of $35K, will be at the average price of a car sold in America. That will make a HUGE difference not only
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I'm all for that "fancy cat" invention. Bring it on.
A tax break isn't s subsidy (Score:2)
A grant, yes, but not a tax break. Just because you are getting fucked by taxes doesn't mean the other guy who isn't is being subsidized.
Re:A tax break isn't s subsidy (Score:5, Informative)
Re:A tax break isn't s subsidy (Score:5, Interesting)
Money is fungible, but the word "subsidy" does imply a flow of government to someone. Tax break is the proper term to use unless you are deliberately trying to mislead people. See also "corporate welfare".
In this case, the "subsidy" flows to anyone in the same position as Musk. It's not a special favor or anything evil - it's just the government staying hands-off on a certain industry in order to encourage growth and an attempt to stem the flow of jobs overseas.
I actually like the idea of abolishing corporate taxes to extend this benefit to all businesses, and to simplify the costs of doing business - no need for a big expensive accounting department. The loss of revenue can be more than made up by closing loopholes and writeoffs in the personal income tax, raising the capital gains rate, and abolishing "qualified" dividends. This would make the US even more attractive to multinationals, which would somewhat mitigate the loss of accounting jobs.
Re:A tax break isn't s subsidy (Score:5, Informative)
Money is fungible, but the word "subsidy" does imply a flow of government to someone. Tax break is the proper term to use unless you are deliberately trying to mislead people. See also "corporate welfare".
I've commented on this before in other threads. There's a (rather disturbing IMHO) school of thought that thinks government is the ultimate economic engine. Thus any money the government doesn't collect is equivalent to subsidy.
Re:A tax break isn't s subsidy (Score:4, Insightful)
It's even sillier than that ... "[the figure] also includes tax credits and rebates to buyers of solar panels and electric cars" ... in other words "subsidies" given not even to Musk/companies, but to customers.
So what's news about this? (Score:5, Insightful)
Big companies get subsidies in the form of tax breaks all the time.
They bitch about taxes, get a deal, then they bitch because the schools aren't churning out worker robots with the necessary skills- schools that would be funded by the taxes the big corps aren't paying.
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Schools are paid for by property taxes. That makes up a tiny, tiny fraction of tax break incentives given out to companies. And the parents who work at a company getting a property tax break buy homes in the area with their salaries.
Re:So what's news about this? (Score:5, Insightful)
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.
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A (very) eye opening thing was when a friend who is a teacher advised me to google salaries for my local state / local school district.
Teachers salaries are public record (although usually you'll find the public record is updated after a few years, so you might just now see salaries for 2012 online).
And the interesting thing, while junior teachers might make $10 an hour (which is barely livable), senior teachers will be salaried at $150k+ per year.
And, on top of that: they only work 9 months out of the year
Re:So what's news about this? (Score:5, Insightful)
Oh cut the crap. High level school administrators in wealthy communities in the Northeast, Chicagoland, or West Coast might get $150k/yr. Teachers don't. You state that your eyes were opened with the help of a friend and google? Put up or shut up. Link to some teachers making $150k/yr. Open our eyes. Until then, I'll just know that you're just making things up -- I review my own (rather wealthy) town's budget every year; our teachers don't sniff that kind of wage.
Re: So what's news about this? (Score:3, Insightful)
In my area the go up to the 90s in pay (five years ago anyway).
That's 15 years working with a doctorate.
Teachers work about 210 days, vs 240 for a typical worker in a good job ( three weeks off and a week of holidays)
Starting pay was 28.
Re:So what's news about this? (Score:4, Insightful)
10th would be pretty good - better than average. It certainly would not explain the chronic underperformance. The US government says we are only below Switzerland, Norway, and Austria by one measure and only behind the Swiss by another measure. [ed.gov]
In any case, the meme of "Americans don't invest in education" is a faulty one. We just don't invest our dollars very well.
Good business (Score:2)
What's good for GM is good for America (Score:2)
And I'm sure the railroad barons felt the same way.
Re:What's good for GM is good for America (Score:5, Insightful)
I'm sure they did.
And the evidence is that they were right, by the by. Note that sans railroads, the USA would probably be five or six nations now. Running a nation that requires literally months to cross isn't practical....
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Ask Warren Buffet. He's the modern railroad baron. He owns the lines that the oil tankers run on. He has a vested business interest in supporting politicians who block the pipeline.
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It's funny you should say that, because the railroad companies received subsidies in the form of land grants and rights-of-way. Quite a lot of them.
So what? (Score:4, Insightful)
If you want to complain about government largess to corporate America, there is no shortage of other, far more dubious, targets...
That's a good thing (Score:5, Informative)
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.
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If the people pass laws
Actually, the people's representatives get together and pass laws after listening to various lobbyists.
Re:That's a good thing (Score:5, Insightful)
Lobbying used to be called bribery. Just because there's a few strings attached doesn't make it any difference in actual practice.
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Exactly!
It's still cheaper than war (Score:5, Insightful)
The oil industry periodically requires wars to secure its supplies, and a lot of its profits accrue to countries with interests inimical to those of the U.S. To give you an idea, Operation Desert Storm cost $104 billion [cnn.com] in nominal 2014 dollars. From a strictly cost/benefit perspective, the U.S. is underfunding these companies.
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It's not just the money. Don't forget about all lives that are lost in wars. And people suffering from air pollution caused by burning fossil fuels.
A lot of what he's talking about aren't subsidies (Score:5, Insightful)
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.
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On the contrary - SolarCity retains the tax breaks and the subsidies. They even counsel against the "buy it outright" option because "you'll need an accountant specializing in energy credits and taxes". (Read "our business model is based on being an unregulated utility and utterly depends on monthly cashflow from leases".)
For one, taxpayers money put to *good* use ... (Score:5, Insightful)
Rather spending that type of money on the bazillions pointless DOD contract where it doens't trickle down but simply trickles away, it goes to a guy and his various crews that actually get shit done. And manufactures mostly domestically. I don't see a problem here.
Re:For one, taxpayers money put to *good* use ... (Score:5, Funny)
"Do you think missiles get stuffed full of crisp new $100 dollar bills and then get fired into rock piles in the desert?"
Of course not. They'd be far cheaper to make if they were full of $100 bills.
so what? (Score:5, Insightful)
Where is the scandal? (Score:2)
However perhaps one good thing about articles like this is that they should quiet down the liber
More stupidity (Score:5, Informative)
In a 2008 blog post, Musk laid out a plan: After the sports car, Tesla would produce a sedan costing "half the $89k price point of the Tesla Roadster and the third model will be even more affordable."
In fact, the second model now typically sells for $100,000, and the much-delayed third model, the Model X sport utility, is expected to sell for a similar price. Timing on a less expensive model — maybe $35,000 or $40,000, after subsidies — remains uncertain.
The Roaster cost more than $89k. That was the value without subsidies. The article is comparing the price of the cheapest model of the Roaster (with subsidies) to the price of the most expensive Model S (without subsidies). Well DUH.
The Model X isn't the third model Musk was talking about. The third model SEDAN is supposedly to be called the Model 3 and unlike what the author said it's planned to be launch in 2017. YMMW. They need the battery factory to be finished so they'll have batteries cheap enough for the Model 3.
SourceForge.net is spreading adware installers (Score:4, Informative)
SourceForge, the code repository site owned by Slashdot Media, has apparently seized control of the account hosting GIMP for Windows on the service, according to e-mails and discussions amongst members of the GIMP community—locking out GIMP's lead Windows developer. And now anyone downloading the Windows version of the open source image editing tool from SourceForge gets the software wrapped in an installer replete with advertisements.
Link to original source [arstechnica.com]
The GIMP developers aren't happy at all about this. They say that Sourceforge impersonated the GIMP developers, and abused the trademarks owned by the GNOME foundation [gnome.org]
Value for money bail outs (Score:2)
How large were the bail outs to failures such as LTCM and recently to the all banks and car companies after the last financial crash?
Tritium
Re: (Score:2)
That's exactly what I was about to post. The other car companies were bailed out, as well as banks. At least Elon is doing something with great potential.
5 billion is nothing compared to ... (Score:5, Insightful)
Compared to the shenanigans of the coal and oil businesses, even if it is true, this 5 billion is nothing. But most likely it is a hit piece commissioned by the same people who brought you the Iraq war. That one was expansion attempt. Now they are defending the home turf, public utilities using gas and coal. Entrenched monopolies who have never faced competition, lightly regulated by revolving door politicians, lobbyists and company men.
Ayn (Score:4, Funny)
So, it turns out that John Galt is kind of a moocher.
Who could have guessed?
The problem with subsidies... (Score:2)
Isn't this why those subsidies exist? (Score:4, Insightful)
And this is new how? (Score:2)
Its a sad fact that most businesses receive "subsidies" (IE less taxes) for behavior desired by the government, the larger the business the more "subsidies" they can usually take advantage of. Take this how you will, but its less an issue of those who are actually utilizing their rights under the law and more about a government that employs such a convoluted tax law to begin with.
Re: (Score:2)
Setup for prosecurting Elon Musk (Score:2)
Under a Republican administrator, Elon Musk will find himself under indictment and his corporate empire will crumble.
This article is laying the groundwork for that.
why is that? (Score:2)
In addition, Kock broths get more than that EACH YEAR. Do you think that the neo-cons are going after them? And no, the tea-party will not be going after Musk OR kock brothers. As such, the GOP will be split on this.
Oil subsidies: $37.5 billion (Score:5, Informative)
isn't this what (Score:2)
Have to give musk credit (Score:2)
No different (Score:2)
It's no different than what the other car companies are doing. They get tax breaks and investments from various levels of governments to build factories, retool a line, or even just keep a shift. I think that the money would be better invested in giving the employees training and loans for starting their own companies instead of giving the money to the Big 3 auto makers.
But I think the biggest offenders are the sports teams that threaten to leave to another city unless they get a new stadium or arena buil
Re: (Score:3)
If you're so sure, why don't you rent a Tesla and try out the nice little "fake" battery swap station?
Oh, right, because that would go against your theory.
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Tesla has opened their patents up. So, no, these are not Tesla-specific and not of fleeting usefulness.
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