Subsidy King Elon Musk Questions Government Aid to Oil & Gas Industry

AP Photo/Paul Sakuma

Tesla and SpaceX CEO Elon Musk, a recipient of government subsidies at both the federal and state level, recently took issue with the U.S. government’s planned aid to oil and gas companies affected by the Wuhan coronavirus pandemic.

Fox Business reports that Tesla and SpaceX CEO Elon Musk has taken issue with the U.S. government’s planned aid to oil and gas companies affected by the Wuhan coronavirus pandemic, claiming that it is not the “greatest use of money.”

In a reply to a Twitter user, Musk claimed that much of the stimulus money was “questionable,” and the amount being given to oil and gas companies was particularly questionable.

President Donald Trump has asked Treasury Secretary Steve Mnuchin and Energy Secretary Dan Brouillette to form a plan to help the oil and gas industry. West Texas intermediate cure oil futures turned negative for the first time in history on Monday as demand plunged and inventories filled.

Mncuchin said during Tuesday’s coronavirus task force briefing: “Obviously it’s a pretty extraordinary situation where you see the front month of oil futures trade negative.”

Interestingly, Musk himself has benefited greatly from taxpayer money and government handouts, Breitbart News has outlined this in articles as far back as 2016. In an article titled “Elon Musk Wins By Gaming the Subsidy Game,” Breitbart News wrote:

Tesla, which makes electric cars, struck a deal with Nevada in 2014 to build a battery factory in Reno. The state gave Tesla $1.3 billion in special incentives, including an exemption from paying property taxes for 20 years and $195 million in transferable tax credits Tesla could sell for cash. That’s 15 times the size of any previous package of incentives offered by Nevada and one of the largest giveaways in American history.

Gov. Brian Sandoval says the factory and the 6,000 jobs will “change the trajectory of this state, perhaps forever.” But was he bidding against himself? Where else would Musk have built it? Reno is easily accessible by rail and highway to Fremont, and Nevada has the only active lithium mines in the United States.

As for those tax credits, laws in 10 states require car companies operating in those states to sell a certain number of “zero emissions” vehicles. Since only electric cars qualify as “zero emissions” vehicles, and these companies don’t, in general, make electric cars, they buy these tax credits from Musk. So far, Musk has made $517 million in profit at taxpayer expense.

In addition, Tesla gets a 30 percent federal tax credit, which can applied to any tax liability the company may incur. Thanks to tax credits and carry-forward losses, the company already hasn’t paid any federal income tax since 2008. In 2014, it paid $2.5 million in corporate taxes — $178,000 to the states, $2.35 million to foreign governments and a big fat zippy to Uncle Sam.

At the time, the Los Angeles Times reported that Musk had raked in $4.3 billion in government money. Musk’s other major firm, SpaceX, also receives billions of dollars in government money. Breitbart News wrote in July of 2018:

In 2014, Musk pushed for the approval of the AB 777 bill which would exempt spaceflight companies from property taxes. The Wall Street Journalwrote at the time: “Upon his request, Democrats who dominate the legislature are moving to exempt SpaceX and other space-travel companies from California’s personal property tax. SpaceX could have sought an appeal of a property tax bill it received last year for engines built at its headquarters, but instead “jumped the queue and petitioned the legislature for a tax reprieve.”

Shortly after this, SpaceX moved their operations from California to Brownsville, Texas. This decision was made as Texas offered the company a $100 million economic incentive package, $15 million for closing the deal and agreeing to move and a commitment from the state to invest $85 million into infrastructure investments to support the company. Texas offered these subsidies to Tesla in an effort to create 300 high-paying jobs in Brownsville which has previously been rated as the poorest city in America.

Aside from this, SpaceX has received $5.5 billion in government contracts from NASA and the U.S. Air Force. This means that government money is funding a large number of SpaceX’s operations. This is not a case of “rich guys” paying for something so that American citizens will not have to. Mark Spiegel, a hedge fund manager for Stanphyl Capital Partners told the LA Times: “Government support is a theme of all three of these companies, and without it none of them would be around.”

More recently, the State of New York took a $900 million writedown on its investment in bringing high tech jobs to the state by building a factory and other associated facilities for Tesla. The State is attempting to sell off $50 million in equipment that Tesla never even took out of the warehouse.

Read more about Musk’s use of taxpayer money at Breitbart News here.

Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship. Follow him on Twitter @LucasNolan or contact via secure email at the address


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