Liberals’ investment drives Tesla’s survival

Tesla epitomizes the mutation of modern American liberalism. Once an ideology whose central concern was the plight of lunch-bucket working stiffs and oppressed minorities, liberalism is increasingly about environmentalism and related “quality of life” issues.

These are trying times for Tesla Motors. Its third-quarter sales and revenue disappointed the markets, causing a sell-off in its high-flying stock. Then a Tesla Model S burst into flames after a collision, the third time that’s happened. Chief executive Elon Musk faces “crash and burn” jokes about both his car and his stock.

Tesla might survive this rough patch. Those skeptical of Tesla and the rest of the electric-car industry must acknowledge that Musk’s company has built a nifty car and has stayed afloat longer than expected by many short-sellers who bet on its demise.

 

But Tesla’s corporate fate is ultimately less interesting than the fact that so many people, especially progressives, have become so deeply invested in it — politically and psychologically, if not financially.

Tesla epitomizes the mutation of modern American liberalism. Once an ideology whose central concern was the plight of lunch-bucket working stiffs and oppressed minorities, liberalism is increasingly about environmentalism and related “quality of life” issues.

Framing such long-term challenges as climate change in apocalyptic terms, many “blue” Americans focus more on technocratic environmental fixes — solar energy, electric cars — than on practical solutions to the here-and-now issues of the middle class. Instead of coal miners and steelworkers, 21st-century progressives exalt Silicon Valley’s young men (and women) in a hurry, urging taxpayer financing for their “green” business plans.

And so a man like Musk — a billionaire financed by Goldman Sachs pushing a flashy, battery-powered car priced upward of $70,000 — shared top billing with former president Bill Clinton and liberal think-tanker John Podesta at a 2012 Clean Energy Summit in Las Vegas hosted by Senate Majority Leader Harry Reid.

This version of green capitalism might be justified if it delivered the public goods it promises. Tesla’s trickle-down business plan calls for sales of expensive early models to pave the way for an everyman electric vehicle later this decade.

But even if widely adopted, Teslas would have little impact on climate change as long as drivers have to charge their vehicles from a coal- and natural gas-fired U.S. electric grid. In May, JPMorgan Chase analysts calculated that the Model S’s annual fossil fuel “footprint” is bigger than that of a Honda Civic hybrid.

Nor is there a case for electric cars based on their contribution to U.S. energy security. Thanks to increased oil and natural gas production, United States imported only 40 percent of its oil in 2012, down from 60 percent in 2005, according to the Energy Department. That trend is projected to continue.

Indeed, it was already underway on May 5, 2011, when Diarmuid O’Connell, Tesla’s vice president of business development, hyperbolically told the House subcommittee on energy and power that “oil . . . is now the source of our greatest vulnerability in terms of both national and economic security.”

Nevertheless, Tesla remains deeply dependent on taxpayers. Much has been made of the fact that, last May, the company repaid a 2009 Energy Department soft loan, totaling $465 million, that had enabled it to survive the Great Recession.

READ ENTIRE ARTICLE HERE: http://www.washingtonpost.com/opinions/charles-lane-liberals-investment-drives-teslas-survival/2013/11/11/5dcec8a2-4b0b-11e3-be6b-d3d28122e6d4_story.html?hpid=z3

 

Print this post

Do you like this post?

Add your reaction to this article