In a recent edition of his must-read Committee to Unleash Prosperity Hotline our friend Steve Moore alerted us to another Democrat scheme to use weaponized government to
extract payback from Elon Musk for supporting Donald Trump.
California is facing a multi-billion dollar deficit, but Governor Gavin Newsom says he will use state money to substitute for a $7,500 federal electric vehicle tax credit that Donald Trump vows to kill.
“We will intervene,” he vows. “Doubling down on our commitment to clean air and green jobs in California.”
So, let’s do the math here, wrote Mr. Moore. There are roughly 1.8 million cars sold each year in California. Let’s say half of them are EVs – as new car buyers take advantage of the subsidies. This means California’s budget would swell by another $5 billion – which could double the state’s existing annual deficit.
And to top it off – Newsom is planning to exclude Tesla from his new subsidies, for no apparent reason, except that Elon Musk supports President Trump.
The folly of Newsom’s political payback to Elon Musk can be quantified in dollars and cents for hardworking Tesla employees. Despite opening a new factory in Austin, Texas and moving its corporate headquarters there, Tesla remains heavily involved in California. Tesla’s California factory in Fremont has become the #1 automobile production facility in the United States.
The EV maker has grown from a long-shot startup founded 20 years ago in San Carlos to the state's largest manufacturing employer with 47,000 employees in 2022 – almost half its global workforce – and the world's leading electric vehicle maker.
According to Inside EVs Tesla has a large impact on the Golden State's employment, wages, gross state product and tax base. As many manufacturing jobs have been exported outside of the US over the past decade and international supply chains have been disrupted, Tesla says it has defied national trends by increasing domestic employment and production.
Tesla-supported jobs in California increased by 40% from 2018 to 2021, and 2021 wages exceeded the state average by 50%, offering the highest compensation in Tesla’s sectors.
The automaker also cited a recent economic impact assessment conducted by IHS Markit that details its importance for California, including Tesla-supported California jobs – more than 80,000 direct and indirect jobs in 2021 – and taxes paid – $400 million in state and local taxes in 2021.
The automaker also points out that it has made over $5 billion in capital investments in its California facilities since 2016, chiefly in Fremont where the 2 millionth vehicle rolled off the lines in July 2022.
Newsom says he's protecting California's "green jobs" with a $5 billion taxpayer subsidy. But hey, Elon Musk supported Donald Trump in the recent presidential election, so Democrats will punish him, and the hardworking Tesla employees at Fremont, and the company's Silicon Valley engineering headquarters, by making the cars they manufacture less competitive against EVs manufactured elsewhere. Economics be damned, everything Democrats do is political.
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