Elon musk was a co-founder of PayPal, is the CEO of both electric-car manufacturer Tesla Motors and the spacecraft company SpaceX, and he is chairman of SolarCity. He’s trying to make zero-emission electric cars widely available, launch spacecraft into orbit, invent the perfect battery, and create an effective solar-powered energy grid. These are incredibly broad “infrastructure-level” initiatives. Rather than throwing his power and money into inventing a gadget with his name on it that will appear in people’s homes, he is building the services that eventually all of the gadgets you use will completely and utterly rely on.
If things go really well, everything you do in life could depend on an Elon Musk product to work. Information that is collected from or relays through satellites–or anything involving space, really–might depend on structures launched into space by an Elon Musk company. Your car will be a Musk Car, because even if it isn’t a Tesla it will be using technology developed my Musk that allows it to be efficiently electric and emissions-free. The electricity you use in your home will be from solar energy infrastructure with Elon Musk’s name on it, and will be stored in a super-efficient, long-lasting high-capacity battery with a tiny “Made By Musk” label stamped on the side. Or perhaps it will be called “The Muskovater.” I hope that it is.
This past weekend, the L.A. Times published a story revealing that none of these endeavors would be solvent if it were not for government subsidies. Even though this is an old story (it was a feature story by Forbes nine months ago), conservative media has been predictably freaking out. Rush Limbaugh spent part of his show today asserting that the government subsidies prove that none of these projects is sustainable, which in turn somehow proves that all of these projects are a bad use of money, and are destined to be pointless.
Obviously, according to Limbaugh, Elon Musk is just an opportunist hack who is manipulating the government grant system to accumulate personal wealth, and has absolutely no sincere desire to do any good for the world or anybody else. Obviously.
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Rush Limbaugh doesn’t particularly understand how government subsidies are supposed to function in an economy. Or if he does, he is so convinced that they can never function as intended that he never bothers talking about how they could work. So let’s take just a moment to understand that now.
What’s the point of government research subsidies?
Not every worthwhile project can be expected to turn a profit in the short term, or can be guaranteed to turn a profit in the long term. That doesn’t mean the idea isn’t worthwhile; it just means it’s a huge, risky innovation. Private businesses almost always shy away from these scenarios. Of course, there are “eccentric billionaires” here and there who have their own projects. That is wonderful. But as a democratic society, we have decided that we don’t want the betterment of society to be subject to the whims, quirks, and individual preferences of eccentric billionaires. We decided that there needs to be another way to take big risks toward a better future, not dependent on the largess of some rich dude who, let’s face it, may be just as likely to sink his money into buying his own island as developing a more efficient electrical grid.
So we have a system: The government collects taxes. Scientific committees review ideas. Those committees try to determine both the likelihood of success and the potential impact of the results. And they apportion out grants. Is that a perfect system? Of course not. But personally I’d rather trust a committee of scientists to decide which projects might be most likely to lead to a better future for all of humanity than leaving those decisions to, say, Donald Trump or David Koch.
This system is set up specifically to take creative technological risks. The risk is the entire point. If the result were a “sure thing”, the project would already have been backed by private corporations. Large, wealthy private corporations aren’t stupid… they are just not (for the most part) serious risk-takers. So when we want something visionary to get done, when scientists but not business people say “Hey look this could really big huge at some point down the road!!” the system that we use is government subsidies.
So ultimately, Elon Musk is taking his skill, smarts, and vision, combined with both your (collective) money and his own, and he is taking business risks in order to try to create a better future: a cleaner future, not dependent on fossil fuels, with an energetic space program focused on research and exploration.
Yes, part of the money he is using is “yours” (in the sense that it was apportioned to the government via taxes, and then invested in his companies via government-backed funds). But everybody knows that big visionary projects require risk. He is investing in things that every human on the planet (barring some real political extremists) thinks are good ideas: improve space technology, make energy cleaner, make us less dependent on fossil energy. The value of the goals is completely uncontroversial.
Back to Elon Musk versus the conservatives
The conservative response is this: Let people choose individually. Let it be done by the free market. If everyone really does want these goals, then Musk should have no problem raising fund privately. Why force people to pay for it through the tax system? Why not just do it through private donations?
Which is a funny and ironic argument, coming from the same group of people who often argue that most people are too stupid and untrustworthy to vote.
Make up your minds, conservatives: are The People enormously wise, so that they can actually decode all of the intricacies of new technology and science, and the ins-and-outs of big business, and will always be able to spot the best and most useful technological investments for the future?
Or are they so ignorant that they need to be stopped from voting whenever possible?
You can’t have it both ways.
As a practical matter, the government has been instrumental in the early development of life-changing technology that would never have happened if it required private investment for its core, ground-level infrastructure to be developed. The internet itself is the most commonly-cited example, but many components of your iPhone call into this same category. Sure, the iPhone is a device created by a private company with lots of innovation, and they get full credit for that. But on the behind-the-scenes, infrastructure level, it is made up of parts that got their start because of government spending on pure, risk-taking innovation. Innovation that involved risks that not private companies took, or were ever likely to take.
Now, everybody has a smart phone, thanks to the companies that took government subsidies to imagine a brighter future. So don’t be surprised if by 2050, there are items in every single person’s home that are only there because the government gave your money to Elon Musk. Elon Musk might not actually be the brand name of anything you have, but he will be the one responsible for making your life better.
And you will love him for it.