04/20/2017

If Tesla Is Worth More Than GM, Why Are Taxpayers Still Subsidizing It? [Watch]

Investor’s Business Daily

Motor City: The big news in the auto world was that Tesla (TSLA) topped the market value of General Motors (GM). That means the car company that gets massive taxpayer subsidies is now worth more than the car company taxpayers bailed out a few years ago. Welcome to the world of crony capitalism.

On Monday, Tesla's stock closed at $312.39, which meant the startup electric car company, which sold a grand total of fewer than 80,000 cars last year, was worth more than GM, which sold 80,000 Chevy Silverados every eight weeks. (Tesla's market cap edged below GM's on Tuesday.)

Is this a case of irrational exuberance gripping investors? Or the electric car version of the 1990s internet bubble? Is the future of Tesla really that bright? We tend not to second guess the wisdom of the markets to get things right, at least over the long term.

But it's worth noting that whatever Tesla's growth potential, at the moment the company is heavily reliant on taxpayer support.

For every Tesla car sold (up to No. 200,000), federal taxpayers kick in $7,500 to lower the costs. State taxpayers in a multitude of states pony up still more. In Colorado, they contribute another $5,000 to the electric car kitty, in California, it's $2,500.

When the Los Angeles Times crunched the numbers two years ago, it found that Tesla buyers had received more than $284 million in federal tax incentives and more than $38 million in California rebates. And that was before Tesla's banner 2016 year.

Read full article



You May Also Like:

Fox News To Become More Like Despised Competitor [Watch] Art Moore, WND

GOP Border Tax Will Build A Wall Around Consumers Matthew Kandrach, RealClearPolitics

Thanks To Democrats, Pre-Existing Conditions Outweigh The Uninsured In The GOP Obamacare Deal [Watch] Avik Roy, Forbes.com

For More go to the Home Page >>>

Search

Bookshelf

SHARE

Some titles recent, all recommended -

Special Video Feature



Voices From The 2017 International Students For Liberty Conference

In Search Of History

SHARE

Keynesian Economics and the Great Depression

Hillsdale College economics professor Gary Wolfram discusses Keynesian economics and the factors that pulled the national economy out of the Great Depression. The story of World War II shows that government spending may produce activity, but not the prosperity of a truly healthy economy.

 

-- Gary Wolfram, Hillsdale College,

Shadow Stats Snapshot


ShadowStats alternate economic indicators are based on the methodology of noted economist John Williams, specialist in government economic reporting.

  • Unemployment:
    BLS: 4.5%
    Shadow Stats: 22.5%
  • Inflation:
    March Year-to-Year: 2.74% (CPI-U*)
    Shadow Stats: 10.5%

*[cpi-u is the Bureau of Labor Statistics inflation rate for all urban consumers]