“Taxpayers footed the bill for a $465 million loan to troubled electric carmaker Tesla as part of President Barack Obama’s ‘green energy’ stimulus. But Tesla’s CEO Elon Musk is now riding high with the purchase of his new $17 million mansion,” Wynton Hall reports at Breitbart.com.
“In September,” Hall continues, “the New York Times reported that Tesla had burned through cash and missed production targets, raising ‘questions about the long-term viability of the company’ and igniting ‘criticism of the government’s energy loan program, which has been heavily promoted by the Obama administration.’ But Tesla says it has begun making payments on its government loan ahead of schedule.”
As always, there’s more to the story.
The “troubled electric carmaker Tesla” is not the only taxpayer-funded Musk project. Seems the word is slow to get around, as well. I’ve been reporting on this for quite some time:
Astronauts at the International Space Station — two from NASA and one European — are spent Memorial Day 2012 unpacking 1,014 pounds of cargo (mostly food, clothing, and science projects) from the SpaceX Dragon unmanned space capsule. The Dragon made “spaceflight history” when it docked Friday and again on Saturday when the hatches between it and “the $100 billion orbiting lab were opened.”
- SpaceX holds a $1.6 billion contract with NASA to make 12 supply runs to the space station. Dragon’s current mission is a demonstration flight to see if the capsule and SpaceX’s Falcon 9 rocket are ready to start the bona fide cargo deliveries.
If all goes well, the first of the 12 contracted missions could launch in September, NASA officials said.
What you will not find mentioned in media stories about the inaugural SpaceX flight is that one of the company’s co-founders, Elon Musk, is an Obama administration “welfare case”.
Rooftop solar panel maker SolarCity was ready to receive a $344 million loan backed by the Department of Energy to “put up to 160,000 rooftop solar installations on top of privately run military housing complexes at 124 military bases across 34 states.” Funds were to come from financiers U.S. Renewables Group and Bank of America.
However, the loan guarantee “means that if SolarCity’s project does not succeed, the DOE will use taxpayer money to pay back 80 percent [$275 million] of the company’s private loans,” Amanda Carey reported at the Daily Caller.
Need we mention that the Obama government backed the now-failed Solyndra?
Read on — there’s a lot more to this story, as well.
In June 2011, SolarCity received $280 million in financial backing from Google. The funding was for the company “to build and lease solar power systems to a 7,000 to 9,000 homeowners in the 10 states where it operates,” CNN reported.
In September 2011, Google made another large investment in the solar power industry, dropping $75 million into “Clean Power Finance, an online service that connects solar panel installers with investors.”
SolarCity was co-founded in 2006 by Elon Musk and his brother-in-law and SolarCity’s CEO, Lyndon Rive.
Between the time of its founding and September 2011, SolarCity had only installed 16,000 rooftop units. The company then had a grand total of $624 million at its disposal.
- The stock soared 47% above its $8 IPO price to close at $11.79.
The company, which sets up financing for individuals and companies to install solar equipment, raised $92 million from its IPO — it sold 11.5 million shares at the $8 IPO price. That was a bit of a downgrade from the 10.1 million shares it expected to sell for between $13 and $15 a share. …
SolarCity is just the latest company for Musk to bring public. His electric car company, Tesla Motors, on June 28, 2010 raised $226 million by selling 13.3 million shares at $17 a share. Shares of that company now trade for $35.05.
But there’s more. According to USAToday, “SpaceX has not yet gone public, but in a Tweet Wednesday Musk hinted that an IPO might be something he’d consider.”
Of course he is. Gotta pay for that McMansion somehow. Nice how those taxpayer-funded investments have helped build Musk’s bank account.
Musk is also among Obama’s major financial supporters. On April 15, 2011, Musk donated $35,800 to the Obama Victory Fund and $5,000 more to Obama’s presidential campaign. Plus, as Hall reports at Breitbart, Musk dropped another $100,000 on Obama’s 2012 campaign.
This begs the question of whether this is just more of the same old, same old Chicago pay-to-play — or not.
Musk is a bona fide member of the government looters in the Obama circle.
In August 2009, Ryan Tate observed at Gawker that Musk was “becoming a welfare case.”
Two months earlier, Musk’s Tesla Motors received $465 million in government loans — again from the Department of Energy — to fund its Model S sedan.
At the time, Tesla had just opened its seventh “outpost” in The Westchester, an upscale mall in New York, its first on the East Coast. (Others are located in in Seattle, Denver, Chicago, Houston, and in Orange County and San Jose, California.)
The key word here is “upscale”, as Tesla’s base Model S “starts at $57,400 before federal tax credits and rises to $105,400 for the Signature Performance model.” Tax credits, by the way, mean U.S. taxpayers pick up the tab to help subsidize purchases made, for the most part, by the vilified 1%.
In February 2009, however, Tate dubbed Musk’s venture a “fantasy”:
- Here’s Tesla’s catch-22: The government will only loan Tesla money if bureaucrats deem it financially viable. And it will only be financially viable if it gets the loan.
In the mind of an entrepreneur like Musk, this is a mere detail. The money is as good as his, and the only hangup is getting everyone to share his vision.
In fact, Tesla is far from profitable. Tesla has already raised prices on existing orders for the company’s $109,000 all-electric Tesla Roadster, an admittedly nifty car which accelerates from 0 to 60 miles per hour in four seconds or less. Musk justified the move by claiming the company wasn’t making a profit on current orders.
On June 24, 2011, Tate wrote:
- It was no small feat to convince the federal government of Tesla’s financial viability, given his firm’s recent struggles with liquidity and shakedown of customers for more money. It also must have been tricky to sell the Model S itself, given that Tesla has been showing off a “barely ambulatory” prototype, in the words of the Los Angeles Times.
The latter comment is mirrored by the message delivered at the recent Westchester opening:
- “I hope we never sell a car here,” George Blankenship, vice president of worldwide sales and ownership experience at Tesla Motors, said as he gestured Thursday around the company’s newest storefront. … “Our goal instead is to interact with people when they’re looking at new things in the mall and not necessarily in the market for a car. The focus is on answering the many questions they have about electric vehicles and the Tesla Model S.”
Initial delivery of the Model S had been bumped up to June 22: “Several customers will receive their cars that day at an invitation-only event at the Tesla Factory in Fremont, California.”
Musk is also a trustee of the X Prize Foundation and a board member of the Planetary Society, both of which I discussed in my September 2, 2011 post, Blue Origin’s Space Test Flight Fails. Futurists Plan for Fortresses Around Countries. Read it. It’s an eye-opener.
Tate’s assessment of Musk as a “welfare case” comes from the August 2010 report that Musk was looking for federal funds for SpaceX, which was “urging the White House to come up with… financial support” for their Falcon 9 heavy rocket.
Musk was looking for another Obama bailout: “SpaceX would then charge the government to send astronauts and space-station parts into orbit.”
- The bailout could hardly come at a better time; despite private infusions totaling at least $120 million, and millions in fees from government customers for its first few launches, SpaceX has become famous for its failed launches. The company notoriously sent the ashes of Star Trek actor James “Scotty” Doohan into the South Pacific rather than toward the stars, giving the startup a perfect 0-for-3 record. In the intervening year, the company has successfully launched exactly one satellite, and been bailed out by PayPal co-founder Peter Thiel. Thiel, a libertarian, no doubt relishes the thought of displacing NASA bureaucrats. But he’ll have trouble explaining to his pro-oil-drilling, anti-immigrant political buddies why he’s helping a Democratic administration grow the federal debt through a massive pork-barrel subsidy to an environmental entrepreneur, from South Africa.
Musk also has his sights set on Mars.
Owen Thomas wrote May 11, 2009, at Gawker:
- The Red Planet beckons electric-car entrepreneur Elon Musk. He’s hoping to put a man on Mars by 2020. Space fanboys are placing their dreams of getting off this rock on a slender reed.
It’s not that Musk’s dreams — introducing a mass-market electric car, colonizing space — are ignoble. Far from it. It’s just that he lacks the means and the mindset to realize them.
Every dreamer must turn huckster at some point, lest his fantasies remain just that. But Musk is taking the practice to an extreme.
It’s a good thing that Obama wants a manned mission to Mars, is it not?
- [In April 2010,] Obama said NASA should focus on conquering new frontiers instead of revisiting places, like the lunar surface, where astronauts have already set foot.
“By 2025 we expect new spacecraft designed for long journeys to allow us to begin the first ever missions beyond the moon into deep space,” Obama said. Such journeys, the President argued, would pave the way for missions to Mars.
Obama’s plan also calls for the construction of an advanced space telescope to replace the aging Hubble, a $3 billion investment in new, heavy-lift rockets, and the building of a new space capsule.
The capsule could be used as an escape vehicle if astronauts need to depart the International Space Station in an emergency, Obama said.
It was so obvious that Musk was ready to undertake any well-[federally] funded space adventure. Ch-ch-ching!!!