Another chapter in the ongoing saga of Tesla Motors. Telsa sells sophisticated electric cars, and like other manufacturers of electronics, they want to sell their products directly to consumers. After all, nobody objects to the stores owned by Apple, or Sony, or Microsoft (or AT&T, Verizon, Sprint, etc.) selling their products directly to consumers. Tesla’s point is that traditional car dealers know little about electric cars (and even less about repairing them) and actually get in the way. Besides, does anyone actually enjoy the experience of buying a car through a typical car dealer?
Nevertheless, powerful car dealership associations have struck back, managing to make it illegal for Tesla to sell their products directly to consumers in five states (Arizona, Texas, Virginia, Maryland, and New Jersey, plus restrictions in four others). Hypocritically, many of these states are controlled by Republicans, who claim to be the champions of free markets and haters of government regulations and other interference in free markets. As someone in a movie once said “You keep using that word. I do not think it means what you think it means.” Indeed, in a free market, the market should decide whether car dealerships provide any value to consumers, not the government.
Now here’s the fun part. Tesla has announced that they will be building a “giga factory” to produce the batteries for their cars. The factory will cost $5 billion, and will employ up to 6,500 workers. Plus it will be powered primarily by solar and wind energy, so Tesla is looking to build it in the Southwest.
And like the whores that they are, politicians from Arizona and Texas are lining up to try to sweet talk Tesla into locating the factory in their state. Ironically, one Republican politician wrote a letter to the Tesla to encourage them to locate in Texas, touting his state because “Texas has the best climate in the country to run and grow business because of its low regulations and limited government interference.” Seriously. Texas’ “low regulations and limited government interference” won’t let Tesla sell their cars in Texas, but they are only too happy to take their sweet jobs.
In a related story, I’ve been wondering for a while why Republicans (and some Democrats) are falling over each other trying to get the environmentally problematic Keystone XL pipeline approved, which would take tar sands oil from Canada and pipe it all the way across the US to ports in Texas so it can be shipped to other countries. Like, how does this benefit the US? According to PolitiFact, this pipeline will create a whopping 35 permanent jobs.
So it was hardly a surprise to find out that the largest lease owner of Canada’s tar sands is not a big oil company like Exxon Mobile or Shell, but is a subsidiary of Koch Industries. I guess the investment the Koch brothers have made in politicians is paying off.
9 Comments
I was very surprised to see Maryland in your list of states that made it illegal for Tesla to sell cars. Being my state, I can tell you it’s one of the most blue states in the Union. We have an almost completely blue government. Democrats control the governors mansion, state Senate and state House of Representatives. We have 2 Dem US Senators and only 1 republican congressman out of 8 seats. We have both Steny Hoyer (house minority whip) and Chris Van hollen a very outspoken supporter of all things democrat. Our Gov has intentions of running for President although he doesn’t stand a chance after criticizing an Obama policy 2 years ago at the Democratic convention, but would be very content with a vice presidency.
I do agree completely with the hypocrisy of touting free markets while not allowing any new entries into that market.
Me smells something fishy in Denmark.
Off topic, but if the simple act of criticizing a policy at a convention X years ago makes you unable to win national office, that’s sad.
Why don’t they use hydroelectricity instead and move to Canada? The infrastructure is already there, they could buy back a moribund auto plant instead of forking the cash for a new one, Canada have public health insurance and Quebec has great prices for its sustainable electricity. Plus, there is no ban on selling directly to the consumer in Canada. Or they can ask Texas to waive its ban on selling directly to consumer and move there.Hey, they could have all the southwest states fight over which one lifts the ban the earliest and when they are done, move to Quebec!
Yudith, they are definitely putting pressure on Texas and Arizona to lift their bans. A Tesla VP said “The issue of where we do business is in some ways inextricably linked to where we sell our cars. If Texas wants to reconsider its position on Tesla selling directly in Texas, it certainly couldn’t hurt.” And Arizona has already introduced a bill to make it legal to sell Tesla cars direct.
PSgt, many of the laws that make it illegal to sell cars direct (without an independent dealer) are old. Tesla has been able to get some of those laws overturned, but in some states dealer associations are powerful. Maryland might be one of those states. I focused on two Republican states because those are the ones trying to court the factory (while not allowing their cars to be sold). Plus, it is the Republicans who constantly talk about keeping the government out of your business. But — obviously — corruption cuts across all party lines (I did mention that there are Democrats who are supporting the Keystone XL pipeline too).
I suspect that criticizing an Obama policy is not the only issue Martin O’Malley has making him an unlikely president. After all, Hillary Clinton did way more than that during the 2008 presidential primary, and she is way in the lead now.
Ahh on Clinton monarchy, yes Hilary did take shots during the primary’s, but I think Bill still pulls all the strings. The Clinton organization is the defacto leadership of the democratic party. Obama was wise to court his Billness during his re-election. And consequently, I bet he’ll be Hilary’s #1 supporter.
Also understand that I was hoping Hilary would run against Obama for the 2012 election and she would have got my vote and I think could have won. She’ll win easily in 2016.
I don’t know why the party elite don’t like Martin. He’s true blue as close to 100% as can be. I think he gets in trouble sometimes because he speaks his mind, which is sometimes different then perty leadership.
Personally, I like O’Malley and voted for him twice. On my last deployment I was a senior leader with a group of guardsmen and on Christmas day while we were overseas, he personally (not a staffer) called every family to thank them for their sacrifice and for supporting the Soldiers. When we returned home we were all, invited by official invitation to the Governor’s mansion for a luncheon. He and his wife gave us a personal tour of the mansion (even the private quarters) and he went around and sat and talked at every table and with every Soldier and family member.
I don’t agree with all his policies, but as a man he is a good guy. And I’d rather vote for somebody that I know really cares then somebody I agree with 100%. Because maybe I’m not right all the time and I feel a good person will use their best judgement.
Good post … but why insult whores?
David, you’re right. At least real whores sometimes make you feel good while they are screwing you.
I have said this before, I will repeat myself, in order for free markets to work, government must not interfere in businesses nor businesses interfere in government. And sadly we see this violated numerously.
I think basic regulations should go in constitution (regulations against monopoly, deceptive practice etc). And also what government can and cannot do. So by constitution government should be prohibited passing any laws that impede innovation and laws that kill competition (like in case of Telsa). So if any states make such laws they can be challenged in courts. Similarly if government makes a law that over regulates (I have not seen many example for this though), then businesses can challenge such laws in courts.
Hillary Clinton: insider information on Commodities. Vince Foster. You think none of that would be brought up during an election? Karl Rove is old enough to remember that.