Elon Musk learns the cost of dancing with the devil

Elon Musk has created a virtual fortune and has become a Silicon Valley titan with a combination of genius and cronyism. For every forward-looking idea like electric cars and space travel, there's an equal and opposite idea rooted in the age-old government subsidy two-step. With respect to electric cars, Musk has played that game to perfection--getting rebates that allow rich people to save money on his cars and finding politicians who allow his manufacturing plants to be built with taxpayer money.

There is something abhorrent about offering rebates funded by taxpayers of all stripes for purchase of a $100k car that few of them could ever afford. Even if you focus on the Tesla cars that sell for closer to $50k, you need to consider that there are middle-class workers who make that much in a year whose taxes, in some fraction, are subsidizing those purchases. 

Musk also shares with our current Commander in Chief an inability to not use social media any time an idea--good, bad or frequently not properly vetted--pops into his head. This is the guy who thought it was a good idea to suggest that he might be selling the company for $420 a share (420, slang for smoking marijuana, get it?)--thereby popping the share price of his company and squeezing short-sellers--before it became clear that there wasn't any offer. The SEC, never one to miss an opportunity to do basically nothing, ultimately found him guilty and suggested really, really firmly, that he not do it again. And he hasn't--too much.

Musk and his favorite pastime

But, OK. He's a smart guy, and he's gaming the system the way smart guys do. If government officials are so gullible or corrupt, then you can argue the problem lies more with them than with the person who merely works within the system. Here, again, Musk is not dissimilar to Trump, who when asked during the run-up to the 2016 election whether he had ever paid off union officials to get work done basically said: "of course; nothing gets done in New York unless you do." 

Well, last week, Musk learned that the devil giveth and the devil taketh away. At least, if the devil works in government, answers to no one, and is in line to retire with a generous taxpayer-funded pension. You see, Tesla's lone factory, located in Freemont, California, has been sitting idle since March 21. Musk loudly complained about having to shut down over the coronavirus panicdemic, but ultimately relented when it became apparent that the other commercial enterprises not deemed "essential" were abiding by California edict. Sheep are never in short supply, even during a pandemic.

Tesla plant in Alameda

Now that the reigns are loosening in California, Musk wants Tesla back up and running and thought he'd be able to do just that. But not so fast: A mid-level bureaucrat in Alameda county, which includes Freemont, notified Musk that the Tesla plant would not yet be allowed to reopen. It's at this point that Musk started one of his Twitter tirades. But this one put the county of Alameda and the state of California in his sights. The tweets were classic Musk, but instead of listing them one-by-one, I'll summarize. "California: You suck. I may well be taking my business elsewhere. Got any munchies?"

There's probably a lot of posturing here. The cost to move Tesla would be enormous, and there probably aren't enough chickens in California for the amount of egg that the Green-central state would have on its face if they lost the Green car poster child. So, most likely, they'll come to an understanding. 

But in the meantime, the irony is rich: The mogul who built his current empire on the largess of the government is now throwing a public tantrum because the government just told him he has to stay in his room. It will be interesting to watch this play out, because Musk, this time, has right on his side. The government overplayed its hand in shutting down business, and if they don't step aside soon, they're going to have to deal with either a collapse or revolt by those who, unlike government workers, actually have to worry about making a living. 

A deal with the devil never ends quite the way you thought it might.