Plug-in car sales at present still are puny. 10 times puny will not result in a huge number, though this effort could both revitalize manufacturing and transform transportation. Usually only government can fix the chicken/egg problem of low demand without sales needed to lower costs and vice versa. Today's government is so spectacularly dysfunctional, though, that maybe we just have to wait for an Elon Musk in the private sector to fix these huge problems.
Your tax dollars not at work, because they've been cut to the bone in the frenzied race to the bottom.
Seriously CharlesM? Do you really believe that? Wow.
Govt spending has simply exploded over the last decade, esp. since about 2006.
Agree that they are dysfunctional, but I think I see it in the opposite direction.
Frankly I see govt action as often the problem, rather than the solution. One big example is fighting poverty. Look at a chart of the decline in poverty over this nations history. Steady decline until the early 1960's then it flattens out. Flattens out after the govts "War on Poverty" started. Interestingly some estimate the cost at a bit over $17T, ironically the national debt figure.
Imagine-without govt being involved we could have fewer people in poverty and be debt free.
Dennis, GAO did find that the cuts did lead to at least one job lose in the government. Maybe that was Charles?
Good point on the poverty. This is what grates me, I am not opposed to government funding research and development of technologies. Even would support the green energy initiatives and certainly battery developments to finally get the EV into the mainstream. But politicians are not about advancing the good of the nation or the world, they are about getting re-elected. Thus they give away freebies in the name of "fairness" and "good intentions". In the end, we are all made poorer.
Just to be clear, government investment into research and development of the technology. Not investing in prefered markets of the political class. The latter type of government spending is at the whim of the best lobbyists irregardless of party in power.
I am not opposed to green energy, I just cannot afford to pay over 30K for a vehicle that goes less than 200 miles and then needs hours to recharge! Elon realizes this and is willing to invest (at a risk) to develop a market and then be the guy that can fill that market. Win/win if he is successful.
Tesla was a huge benefactor of government loans and green energy stimulus programs. Otherwise they may not be poised where they are today. It's easy to forget all the good that comes out of government spending and let cable news impress upon our brains how disastrous it was (Solyndra, ad nauseam), even when it wasn't on balance. Like your investment portfolio, you should expect a lot of clunkers, but it's only through investing in a lot of "clunkers" that a tiny few, like Tesla, rise to "float all boats." At one time they were all clunkers. (Pardon the mixed metaphors.)
Regarding a 200 mile EV for $30k, you can virtually do that today. If you put aside any perplexing, inconsistent, and high-minded but misguided principle whereby you just can't bring yourself to accept a $7500 federal tax credit to slightly help get the world the heck off of fossil fuels, you can buy a Chevy Volt for very near $37k, give or take a little, netting the $30k cost. Some states have added credits of $2500 or more, making such a prospect all the more attractive.
Range is over 300 miles while daily driving will generally be all electric for most owners. That means you can do most of your driving for about half the fuel cost of putting gasoline in a Prius. The gas engine maintenance, while not zero, will be cut by the same proportion of EV-to-gas driving. You can even find ways to get your electricity from clean renewables and your per mile fuel cost won't go up by much.
As excited as I am about the entry-level Tesla, I think the Volt sets the bar at that price point pretty darn high, and you can buy one today. Compared to a BMW, Alfa, Audi, and other cars I've had, the Volt is the best I've ever owned, by far.
Bunter, didn't 2008 show your repub economic, energy, tax, war policies totally bankrupt? Were they not the cause of the debt including most under Obama which I might add would already be balanced had repubs passed the grand bargain 4 yrs ago and did tax reform instead of just saying no?
Hasn't the best economy, balancing the budget under Clinton with slightly higher taxes?
Had we stayed like Clinton's economics where Americans standrad of living actually rose with slightly higher taxes NO repubs voted for, the national debt would be paid off now, no?
I'm a fiscal conservative unlike the right who seem to be corporatist now.
"My" repub etc.? They don't impress me mush either Jerry. Bush spent too much. OK?
But perhaps you do need a bit of an update on how the govt, to abuse a term, "works".
Congress holds the purse strings.
Look at what happened to spending after we got a Dem Congress in '06.
Bush refused to sign most of the spending for the last budget put on his desk. Obama made it one of his first acts to take care of that. He owns the debt of his presidency.
In his first budget with a Rep Congress Clinton sent three, count 'em, three deficit spending budgets to congress. They sent them all back until he agreed to a balanced budget. It was not the taxes.
You are also making the classic mistake of confusing tax rates and tax revenues. There were three major tax cuts in the 20th century (Coollidge, Kennedy, Reagan) each saw increases in revenue from rate cuts. And economic improvement. Hilariously Kennedy had to fight Repubs to cut taxes for the rich. Politicians are politicians.
Clinton inherited a strong economy and congress kept him from totally messing it up. Lo0ok at the curve of the economy at the end of his run, it was flatlining. Bush inherited a weak economy and implimented Democrat style big govt solutions that, shocker, did not work.
2008-housing financial crisis manufactured by Dem policies (CRA under Carter, given teeth by your beloved Clinton.) Policy stupidity often takes a long time to cause trouble-politician build their carrers on that truth. Clinton was an excellent politician.
I agree that the GOP today is not fiscally conservative. The Dems are even worse.
Personally I'm a fiscal Libertarian (don't agree with all their stuff).
"I'm not impressed Reagan "Grew" revenue, if he burned up the Balance sheet
in the process."
Actually I agree. If you will note I was making a point that raising tax rates does not necessarily increase revenue-in fact historically they have an inverse relationship.
Hence the examples of Coolidge, Kennedy and Reagan cutting rates and gaining revenue plus economic acceleration.
I realize it is counter-intuitive. One thing I was taught that helped me understand was to realize that a tax is a price for a behavior. It is rather sad that everybody understands that a higher tax on tabacco, alchohol or gas is a disincentive to use those items. Yet they miss that taxes that raise the price of acheivement, enterprenuership or buisness also reduce the incentives to do the things that create jobs. France recently raised their tax on high incomes and found that the rich started leaving the country. Shocker.
Please note that I do not support deficit spending from either party, whether it is the party of too big govt with too much spending, or the party of really huge govt with even bigger overspending (those are the current choices). Some of the comments I see by folks that actually think that the leadership of their party is the party that cares are rather precious.
In that area it ia also worth noting the affects of govt spending on the economy.
Admittedly these are corralation-I cannot prove causation-though I suspect others can.
1920ish-Stockmarket crash (yes there was another). Harding trims govt spending massively. Fast recovery-roaring 20's!
1929- Stock crash, in next year unemployment peaks at 9% has fallen to 6% prior to govt stepping in. Govt steps in and the Great Depression results. Both Hoover and FDR make the same mistake, indeed one of FDR's cabinet noted thatt there was nothing in the New Deal thatt didn't have a precedent in the Hoover admin. FDR's treas. Sec. (IIRC) stated thst they had "spent more than anybody before, we know it does not work).
Most recessions since have had very little spending by govt and relatively quick recoveries. The current recovery is possibly the slowest ever and it was preceded with...huge govt spending.
As I said earlier on another subject-there are somethings only govt can screw-up.
I did not specify how much the disincentive is-simply that it exists. And clearly historical records indicate that tax changes are enough of an influence to invert the rate/revenue relationship.
I'm not saying no one will start/expand a buisness simply that the numbers will be reduced.
Your Buffet example indicates the real question-risk vs. reward. Let's say it isn't making 90%, many buisnesses are operating well below 10% profit. With variations in their markets, changes in the economy etc. getting hit with more tax (whether on the buis or their income) could swing a lot of them to say "enough".
Simply noting that taxs do not stop all users of a product does not tell us of the affect on some.
Some of your arguements seem to fall into a family of fallicy of equating charateristics of the individual item with the charateristics of the whole group.
There also seems to be a certain "all or nothing" approach to your positions. I'm not talking about the complete elimination of taxes, just questioning the rates, and indeed pointing out that higher rates do not always produce higher revenues (a classic "lose, lose" situation).
It is also very unclear that higher levels taxation and spending give us "more" or "better" civilization. More is sometimes less. More water may not give you a "better" bath, just an opportunity to mop afterwards. (See my earlier point on the "War on Poverty", it's one of the earliest posts).
BTW, thanks for remaining civil and not decending into personal attacks as some did earlier. It is appreciated.
@patb2009, If their products are clearly superior and competitively priced, they don't necessarily have to be viewed as a neutral supplier. Toyota currently purchases electric drivetrain components from Tesla, and I believe that one other car company does as well. In my opinion, they are doing so because Tesla is building world class drivetrain components, apparently at a cost that makes sense to "competitors".
It's no use arguing, but a few questions. Do you think the economy is stimulated best by government spending or cutting? Do you think that cutting taxes has the effect of cutting the deficit or increasing it? Do you think a collapsing economy, as occurred in 2008, increases federal debt or reduces it? What do you think the effect on you will be as a result of high federal debt--increasing your taxes, less spending for things you want funded like your social security, or what? When do you think that Congress will implement those measures in response to the debt?
Do you think that we should levy taxes to cover the real costs of, say, education and transportation? Or should we come up with games and gimmicks like wars on teachers, privatization schemes for profit, and lotteries, in order to cover education costs? Our transportation infrastructure (roads, bridges, etc.) is in budget crisis. What should Congress do to fix this, if anything?
Do you think the tax code is written to serve middle class individuals and the poor, or to serve corporations or the wealthy? Do you think our economy prospers best with income equality or income inequality and what, if anything, do you propose to do to improve that balance for the health of the total economy?
It doesn't. But that didn't take long for you to go full Tea Party. It must be nice to be so knowledgeable and understand all the problems of the world, their causes/effects, knowing who to blame and what the solutions are if only you were king.
People like you cannot be reasoned with. Enjoy your FauxNews.
Said might, not will. Can't keep up with the pace of this blog.
Never watch Fox ( assume that was what Faux is about). They are all pathetic, fast food blah.
Not much of my knowledge there buddy, Pretty much just historical items with pretty obvious conclusions.
I noticed you chose to go with an ad hominem approach rather than take the risk of actually addressing any particulars. Cool. By all means do some research and see if the items I mentioned are hisorically accurate or not. Then address them or don't.
It might be interesting which of us an outside observer would say was applying reasoning/logic and which was not.
It being Preakness weekend........ my money's on you, Bunter.
There is no reasoning with liberals. I think I read every anti-Republican, Bush, Reagan cliche in one or two posts..... No use attempting to respond or rebut with logic or factual argument.
My one observation to offer here (on the subject article, actually....lol) is that Tesla is really risking it all with, I guess one could call, "thinking outside the box". Innovation and advancement in technology, etc. seem to go the fartherest (and fastest) when this happens. Perhaps the base chemistries, etc. will further advance in the ensuing time-period of the gigafactory development, to further make the battery limitations less severe.
However, the reality at present is that without major governmental subsidies and other finanacial incentives. the old ICE will remain where it is.... number one.
One should cautious of underestimating the reasoning of an opponent in these matters.
Just because the current offerings are ill reasoned does not indicate they lack the capacity to do better. These are intelligent folks, but their positions are largely inline with the prevailing orthodoxy and that leads to less rigorous examination of ones positions. We have the privilage (and I mean that seriously) of being challenged daily in what we believe and that sharpens us for the conflicts.
And indeed, I have found myself in agreement with both of the gents I have opposed today at different times. They are not fools-we just disagree strongly on these issues.
Tesla HAS to grow by ten times or so in the next few years to make a dent in the car market, and it's on the exponential curve, so it's possible.
IC engines could not exist without massive gov subsides and protection from liability.
The research and development that goes into car batteries will also help all portable devices. Tesla has a market for the batteries even if it's not cars.
The reason Panasonic has done so well in the market is thier batteries are the best for the price. http://lygte-info.dk/review/batteries2012/Common18650Summary%20UK.html
How did this get to be about politics?
But here's my 2 cents on that: the founders were Locke Liberals who believed in the social contract and a democratic republic, so using liberal as and epitaph is weird. Perhaps you have been confused because Obama and 80% of the democrats are Reagan/Burke conservative for the most part. They believe in rule by the rich. Obama and the dems want kinder gentler rule by the rich, but they have supported deregulation, privatization, monopolization, the insurance industry, lower taxes and protected bankers from prosecution. Obama's admin has pushed fracking and nuclear all over the world.
Lux has rarely, like EIA, IEA, Pike, ever been right.
Any betting against Musk will likely lose. I gues they didn't notice Musk as other markets for low cost batteries, the only other one than EV's really, home, building batteries to go with his SolarCity RE company.
Facts are going offgrid completely saves so much utility fees it can pay for battery storage. Now add solar costs him less than $1.50/wt installed making power for $.03/kwhr before subsidies and you can see the profits to be made splitting that $.08/kwhr US avage difference savings with the customer making large chucks of cash.
And those numbers are before subsidies which make the systems no cost to SolarCity net.
Transport, utilities and energy in 10 yrs will be very different from today because the wqheel has turned and home, building made power clean is 50% or more lower cost than any utility power. YMMV depending whjere you live, US Average.
Why Tesla battery success works is he controls from making them to the customer thus a market for his production, something others don't have. He makes the market, then supplies it, not hoping others will buy their batteries.
I should mention these same groups were touting how much battery demand there was going to be, every built huge capacity yet no market showed up. The market that did was modstly very limited, low margin or car companies did their own.
Vs Tesla made his market making his profitable as the others tilt to backruptcy having few buyers.
Jerry, you might be reading between the lines a little too much. The intention of the article is merely to show how ambitious Musk's goal is. Today, the entire EV/hybrid battery industry is at 5 GWh per year. Musk wants his company alone to make it to 50 GWh annually by 2020. Surely, it's reasonable to call that ambitious. This article isn't intended to address the likelihood of success. We did that in an earlier article, here:
I agree Charles and the only way he can do it is by making the market.
And he has shown very well he can make new markets.
Vs the others are failing because they are hoping for a market, not a good business strategy.
Only those who have a captive market like Tesla and SolarCity does that no one else will do will survive.
Soon GM will let LG go as will other car makers/markets leaving little for the rest.
Big gird is no market as they won't buy any, only using those paid with grants. And Cal utilities bitched so much solar/wind were variable Cal is forcing them to add big batteries!! That'll teach them ;^p
Other than EV the only other market is home, building storage which SC is going gangbusters.
And just found a front end totaled Leaf EV down the street so soon I'll have a 150-200 mile range all composite EV for $4k in parts, my skill ;^D
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