Correction on Tesla

A bit back, I noted that the apparent $11 million profit generated by Tesla Motors was in fact--after deducting federal subsidies and below market rate loans received by Tesla--a loss of $32 million when honest accounting methods were used.

Well, unfortunately, your host neglected an item that appears on the balance sheet, which is $68 million in carbon credits sold by Tesla to other automakers.    Now beyond the irony of granting this car company carbon credits for making a clearly dirty product--it takes about twice the carbon emissions to build one as a standard car, and they effectively run on coal--you've got the question of why on earth the state of California mandates carbon credits instead of simply increasing taxes on energy.  It is as if they're deliberately choosing the clumsiest mechanism possible in order to bestow largesse on political benefactors like Elon Musk.

Whatever the rationale is, the simple fact is that I was wrong.  Tesla's loss by honest accounting methods is not $32 million last quarter, but rather an even $100 million, or over $20,000 per vehicle sold.  Hopefully legislators will soon wake up to what a fiscal and environmental disaster hybrid and electric cars are, and stop promoting them through government subsidies.