Car Company Gets U.S. Loan, Builds Cars In Finland
ABC NEWS and iWATCH NEWS
Oct. 20, 2011
With the approval of the Obama administration, an electric car company that received a $529 million federal government loan guarantee is assembling its first line of cars in Finland, saying it could not find a facility in the United States capable of doing the work.
Vice President Joseph Biden heralded the Energy Department's $529 million loan to the start-up electric car company called Fisker as a bright new path to thousands of American manufacturing jobs. But two years after the loan was announced, the job of assembling the flashy electric Fisker Karma sports car has been outsourced to Finland.
"There was no contract manufacturer in the U.S. that could actually produce our vehicle," the car company's founder and namesake told ABC News. "They don't exist here."
Henrik Fisker said the U.S. money so far has been spent on engineering and design work that stayed in the U.S., not on the 500 manufacturing jobs that went to a rural Finnish firm, Valmet Automotive.
"We're not in the business of failing; we're in the business of winning. So we make the right decision for the business," Fisker said. "That's why we went to Finland."
The loan to Fisker is part of a $1 billion bet the Energy Department has made in two politically connected California-based electric carmakers producing sporty -- and pricey -- cutting-edge autos. Fisker Automotive, backed by a powerhouse venture capital firm whose partners include former Vice President Al Gore, predicts it will eventually be churning out tens of thousands of electric sports sedans at the shuttered GM factory it bought in Delaware. And Tesla Motors, whose prime backers include PayPal mogul Elon Musk and Google co-founders Larry Page and Sergey Brin, says it will do the same in a massive facility tooling up in Silicon Valley.
For more on the Fisker and Tesla loans and the Obama administration's green auto loan program, watch "Good Morning America," "World News with Diane Sawyer," and "Nightline."
Rob Carr/AP Photo
Vice president Joe Biden, left, and Henrik... View Full Size
Rob Carr/AP Photo
Vice president Joe Biden, left, and Henrik Fisker, CEO of Fisker Automotive announces that the company will produce plug-in hybrid electric vehicles at the former General Motors Boxwood Plant, Oct. 27, 2009, in Wilmington, Del. Solyndra Execs Stonewall Congress Watch Video
Solyndra: A Loan to Nowhere Watch Video
WH Dodges Energy Company Questions Watch Video
An investigation by ABC News and the Center for Public Integrity's iWatch News that will air on "Good Morning America" found that the DOE's bet carries risks for taxpayers, has raised concern among industry observers and government auditors, and adds to questions about the way billions of dollars in loans for smart cars and green energy companies have been awarded. Fisker is more than a year behind rolling out its $97,000 luxury vehicle bankrolled in part with DOE money. While more are promised soon, just 40 of its Karma cars (below) have been manufactured and only two delivered to customers' driveways, including one to movie star Leonardo DiCaprio. Tesla's SEC filings reveal the start-up has lost money every quarter. And while its federal funding is intended to help it mass produce a new $57,400 Model S sedan, the company has no experience in a project so vast.
READ the iWATCH News Story on Tesla and Fisker
There is intense scrutiny of the decisions made by the Department of Energy as it invests billions of taxpayer dollars in alternative energy. The questions come in the wake of the administration's failed $535 million investment in solar panel maker Solyndra. The company's collapse, bankruptcy and raid by FBI agents generated a litany of questions about how the Energy Department doles out billions in highly sought after green energy seed money.
A key question, experts and investigators say, is whether another Solyndra is in the offing.
In interviews, executives with Tesla and Fisker said comparisons to Solyndra are unfounded. Each said the government's investments will ultimately pay off by supporting a fleet of electric cars that will ease the nation's dependence on fuel and benefit the environment.
"It's absolutely a worthwhile risk," said Diarmuid O'Connell, vice president of corporate and business development for Tesla Motors. "I absolutely believe it was a good bet for American taxpayers." Tesla has said its mass production of the sedan will ultimately lead to profitability.
Henrik Fisker, the renowned auto designer who founded the car company that carries his name, said his company holds tremendous promise and has accumulated $600 million in private financing.
When asked directly by ABC News if taxpayers should worry about the more than $500 million in federal funds on the line, he was emphatic: "No, I don't think they need to worry about it," Fisker said. When asked if Fisker might be the next Solyndra, he said, "Absolutely not."
I blame the US Government not the company. Companies take money and build where profits are highest, if they got a grant without strict clauses forcing them to invest the money in the country that provides the support then it is on their head. Caveat emptor rules, with large sum contracts and subsidies it rules twice. Besides at least it is a low/non interest government loan, not a grant. So the US government should get its investment back and still gets electric cars on the streets, perhaps even at the agreed price. Technically the US government are getting what they paid for, assuming the finished vehicles sell in the US at affordable prices.
Frankly you Yanks get it easy. For real two faced, double dealing, subsidy swallowing backstabbers, try a British energy supplier.
Orlanth wrote:I blame the US Government not the company. Companies take money and build where profits are highest, if they got a grant without strict clauses forcing them to invest the money in the country that provides the support then it is on their head. Caveat emptor rules, with large sum contracts and subsidies it rules twice. Besides at least it is a low/non interest government loan, not a grant. So the US government should get its investment back and still gets electric cars on the streets, perhaps even at the agreed price. Technically the US government are getting what they paid for, assuming the finished vehicles sell in the US at affordable prices.
Agreed. This one really is the Energy Depertment's fault for letting the loan go without restrictions.
And the argument is bogus. If Toyota, Honda, Nissan, Ford, and now Kia can make (not just assemble) cars here, including the righteous G37, then some pissant electric car company with ties to the administration can.
Of course its moot. BMW just came out with an eletric uber sports car. There goes the Aryans making their Aryan supercars again.
I like that there's all this "Rabble rabble rabble!" without mentioning the exact wording of the Fisker head.
"There was no contract manufacturer in the U.S. that could actually produce our vehicle," the car company's founder and namesake told ABC News. "They don't exist here."
Henrik Fisker said the U.S. money so far has been spent on engineering and design work that stayed in the U.S., not on the 500 manufacturing jobs that went to a rural Finnish firm, Valmet Automotive.
"We're not in the business of failing; we're in the business of winning. So we make the right decision for the business," Fisker said. "That's why we went to Finland."
So the engineering and design work stayed within the US...but the 500 manufacturing jobs went to a "rural Finnish firm."
Now, if you want to point out "Why didn't they invest the money into upgrade a factory to be able to manufacture their electric cars?"--you have a much, much better point to work from.
SlaveToDorkness wrote:Sounds about right for D'Ohbama.
And he's still better than bush ever was and anyone running for President on the Republican side!
When I think of the United States, at first I'm like "LAND OF THE FREE, HOME OF THE BRAVE", but then I reality and I'm like "why did my family move here from Sweden when I was 3 years old?"
This story really burns my biscuits. We talk a lot about the Republicans burning bridges but I would have hoped Democrats would be more sensitive to their base than this.
EDIT
Although Fisker said that, despite the big layoffs to American auto workers, no US automotive plant would build his car. Plus he says that he plans on producing a compact, less expensive car in Delaware. Leonardo DiCprio got the first of these $97K luxury versions from Finland -- building an image of quality and glamour by having movie stars drive your top-of-the-line cars before releasing a generally affordable version to the wider public seems like a good idea to me.
Looks like this isn't a Democratic gaff after all.
Kanluwen wrote:I like that there's all this "Rabble rabble rabble!" without mentioning the exact wording of the Fisker head.
"There was no contract manufacturer in the U.S. that could actually produce our vehicle," the car company's founder and namesake told ABC News. "They don't exist here."
Henrik Fisker said the U.S. money so far has been spent on engineering and design work that stayed in the U.S., not on the 500 manufacturing jobs that went to a rural Finnish firm, Valmet Automotive.
"We're not in the business of failing; we're in the business of winning. So we make the right decision for the business," Fisker said. "That's why we went to Finland."
So the engineering and design work stayed within the US...but the 500 manufacturing jobs went to a "rural Finnish firm."
Now, if you want to point out "Why didn't they invest the money into upgrade a factory to be able to manufacture their electric cars?"--you have a much, much better point to work from.
Your post clarifies nothing. At the end of the day US middle class taxpayers ponied up a loan for a company to give jobs to the Finnish. How does the UAW feel about that?
I mean I know when I think cars I think Finland, but really, you can't retool a freaking Saturn plant?
Frazzled wrote:
Your post clarifies nothing. At the end of the day US middle class taxpayers ponied up a loan for a company to give jobs to the Finnish. How does the UAW feel about that?
I mean I know when I think cars I think Finland, but really, you can't retool a freaking Saturn plant?
And at the end of the day, you posted the first page of a five page article.
Page two actually has a fun little quote.
In a lengthy interview, Fisker said he apprised the Department of Energy of his decision to assemble the high-priced Karma in Finland after he could not find an American facility that could handle the work. They signed off, he said, so long as he did not spend the federal loan money in Finland -- something he says the company has taken care to avoid. He said the decision, ultimately, was to help prevent his company from following the path of Solyndra, which exhausted nearly all of its loan money on a high-tech solar manufacturing plant in Freemont, California.
So I'm not really seeing a problem, so long as the loan money is not spent in Finland.
Automatically Appended Next Post: Ooh, or how about this quote!
Energy Department officials said such loans, by their nature, are risky because the department is financing innovative, potentially game-changing technologies that could deliver long-term benefits. They said neither firm has missed a loan payment, or sought help from the department to restructure their lending agreements.
Frazzled wrote:At the end of the day US middle class taxpayers ponied up a loan for a company to give jobs to the Finnish. How does the UAW feel about that?
Actually, it's not the end of the day yet. Taxpayers supplied some venture capital so that a product could be designed. That product was created in Finland, seemingly either because American infrastructure was too backward or American businesses were locking Fisker out (remember when the Big Four told Congress that catalytic converters would put them out of business?). The product is now in the hands of a high profile American movie star -- Leo driving this thing around LA is a pretty good ad campaign regarding the sort of people who will be able to afford the coming version for general consumption. And that's going to be manufactured in Delaware.
So if we have another story later that says that those cars aren't being made in Delaware, then your point might have some weight.
Again, I am not terribly annoyed with the Company (ok I am their business is stupid and they will fail in the same epic manner that a cat would fail in trying to steal a snack from TBone). I am annoyed with the US government doing this.
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Nerivant wrote:"You hear about those electric cars? When are they going to Finnish them?"
Karon wrote:When I think of the United States, at first I'm like "LAND OF THE FREE, HOME OF THE BRAVE", but then I reality and I'm like "why did my family move here from Sweden when I was 3 years old?"
Why don't you enhance your reality and move back to Sweden?
Perhaps your family wanted to get away from the Socialism?
The radio is reporting that Al Gore has ties to the Finnish car company getting the loan to increase jobs in the U.S. by building cars in Finland.
Frazzled wrote:I am annoyed with the US government doing this.
For acting like a good capitalist?
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Phanatik wrote:The radio is reporting that Al Gore has ties to the Finnish car company getting the loan to increase jobs in the U.S. by building cars in Finland.
First, "the radio" is not a source. Second, your post does not reflect an accurate understanding of the news story.
For doing what? Funding two companies(Tesla and Fisker) to make electric cars?
That first page is purposebuilt to get people rabblerousing. It looks like ABC realizes it's easier to get hits when you purposely post misleading loads of crap.
SlaveToDorkness wrote:Sounds about right for D'Ohbama.
And he's still better than bush ever was and anyone running for President on the Republican side!
When I think of the United States, at first I'm like "LAND OF THE FREE, HOME OF THE BRAVE", but then I reality and I'm like "why did my family move here from Sweden when I was 3 years old?"
Passports just require a photo and some paperwork. Don't forget to take a jacket. I hear its a might nippy.
Frazzled wrote:I am annoyed with the US government doing this.
For acting like a good capitalist?
The US government? Thats not capitalism.
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Phanatik wrote:The radio is reporting that Al Gore has ties to the Finnish car company getting the loan to increase jobs in the U.S. by building cars in Finland.
First, "the radio" is not a source. Second, your post does not reflect an accurate understanding of the news story.
Chibi Bodge-Battle wrote:It's called global capitalism Frazz
It's what corporations do.
They prolly got big taxs beaks from Finland too
I don't mind capitalism.
1. Its stupid. Finland doesn't make gak int he way of cars. The US has car companies from all over the globe.
2. Again if they want to make a stupid business decision I am absofrakinglutely fine with it. I'm mad at the US government for loaning them money.
Frazzled wrote:I am annoyed with the US government doing this.
For acting like a good capitalist?
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Phanatik wrote:The radio is reporting that Al Gore has ties to the Finnish car company getting the loan to increase jobs in the U.S. by building cars in Finland.
First, "the radio" is not a source. Second, your post does not reflect an accurate understanding of the news story.
First, do you know that guy google? He lets you look things up. It works even if you're not doing a dissertation, or term paper, or writing a book. You know, like Dakka. And golly gee, sometimes things on the radio are on google.
Second, perhaps you don't understand the Obama Administration. My post reflects Obama's frivolous spending of taxpayer dollars and his failure to (help) create jobs here in America. I didn't limit myself to one news article.
From the Wallstreet Journal piece via Huffington that Frazzled posted:
"This is not for average Americans," said Leslie Paige, a spokeswoman for Citizens Against Government Waste, an anti-tax group in Washington. "This is for people to put something in their driveway that is a conversation piece. It's status symbol thing."
About CAGW:
Two years ago [2004], the watchdog group Citizens Against Government Waste launched a lobbying campaign about avocados.
The group, which enjoys a strong reputation in the nation's capital for keeping an independent eye on government spending, plunged into an obscure agricultural dispute. It issued press releases and prodded its members to support avocados from Mexico
[...]
Citizens Against Government Waste did not reveal what motivated the aggressive campaign: It had received about $100,000 from Mexican avocado growers.
That's just one of many instances in which CAGW has traded on its watchdog reputation by taking money from companies and trade associations and then conducted lobbying and public relations campaigns on their behalf - without revealing that money changed hands.
I think it's pretty funny that a grass roots corporate-front like CAGW would criticize something for being a luxury good. Just like in this thread, CAGW are pretending like they don't know how advertisement works.
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Phanatik wrote:First, do you know that guy google?
When you make a claim, it's your responsibility rather than your audience's responsibility to cite what information backs the claim. You should have learned this in highschool.
I didn't limit myself to one news article.
That is completely apparent. Not only did you not limit yourself to one article, you didn't even bother to read it for comprehension.
SlaveToDorkness wrote:Sounds about right for D'Ohbama.
And he's still better than bush ever was and anyone running for President on the Republican side!
When I think of the United States, at first I'm like "LAND OF THE FREE, HOME OF THE BRAVE", but then I reality and I'm like "why did my family move here from Sweden when I was 3 years old?"
You could always move back.
While I might not agree with the way that thinks went down, the company isn't responsible for employing American workers just because they took American money. Unless that was a stipulation of the loan, whic it probably wasnt. This is why the government shouldn't be "investing" tax money. Its not thier money to invest and if it's not being spent on "the common defense and general welfare" then it's unconstitutional to boot. Investing in businesses stretches general welfare a little too far, even for progressives.
Frazzled wrote:The US government? Thats not capitalism.
Capitalism does not preclude government investment. In this case particularly there isn't even any government ownership. We're talking about a loan.
1. Thats not capitalism
2. Thats not capitalism when those jobs go to a foreign country. Play hanky panky all you want. At the end of the day those jobs are not going to the US.
The management at the Energy Department needs to be terminated.
Manchu wrote:When you make a claim, it's your responsibility rather than your audience's responsibility to cite what information backs the claim. You should have learned this in highschool.
If you are simply going to nitpick, high school is two words. you should have learned that in high school. (nitpicking just doesn't sit right, does it?)
Again, I'm not defending a dissertation, a term paper, or writing a book. This is ...Dakka! It's perfectly acceptable for me to say the radio is reporting something, especially when it's true. If you disagree with it, you can devote any amount of time you want to copy and paste until your heart's content to refute it, if possible. That's your choice.
As far as my post regarding Obama, electric cars, taxpayer money, etc, ...irony?
Frazzled wrote:Play hanky panky all you want. At the end of the day those jobs are not going to the US.
As I already said, it's not the end of the day just yet. A private company got a loan from the US to design cars. It did that. It tried to build the cars in the US, too, (which was not a condition of the loan) but was shut out from reasonably doing so. In the meantime, Biden said that the loan would create American jobs. According to Fisker, we're simply not at that stage of the plan. If they put the cheaper cars into production is Sweden, then you can start calling it a failed investment per Biden's criteria.
Phanatik wrote:Again, I'm not defending a dissertation, a term paper, or writing a book. This is ...Dakka!
You need to be reasonably informed about topics even in casual discussion and not only when you're defending a dissertation.
Phanatik wrote:If you are simply going to nitpick, high school is two words.
Making unsupported claims with sensational implications and making a typo are pretty different problems but thanks for the spellcheck ... or should that be spell check?
Orlanth wrote:US government money paid for the project setup, which then outsourced production to Finland.
The US government loaned money to a private company to design an electric car. The fact seems to be that a private company used money it borrowed from the US government to design an electric car.
The news story is that American manufacturing jobs have not yet resulted from that loan money but may next year.
When I put it like that, it's not nearly so interesting.
Frazzled wrote:Play hanky panky all you want. At the end of the day those jobs are not going to the US.
As I already said, it's not the end of the day just yet. A private company got a loan from the US to design cars. It did that. It tried to build the cars in the US, too, (which was not a condition of the loan) but was shut out from reasonably doing so. In the meantime, Biden said that the loan would create American jobs. According to Fisker, we're simply not at that stage of the plan. If they put the cheaper cars into production is Sweden, then you can start calling it a failed investment per Biden's criteria.
We have absolutely no proff it was "shut out." Shut out where? Cars and car parts are made in Michigan, Illinois, Tennessee, the East Coast, California, and Texas (those are just the states off the top of my head). Companies with automobile operations include Ford, Nissan, Toyota, Honda, Hyundai, GM, Daimles Benz, BMW, and Fiat.
Yet these guys got shut out? yea...
Didn't Saab just go into bankruptcy...
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Orlanth wrote:
Rented Tritium wrote:They didn't spend any of the government money in finland.
They didn't spend any of the government money in finland.
They didn't spend any of the government money in finland.
They didn't spend any of the government money in finland.
They didn't spend any of the government money in finland.
Should I keep going or do you understand now?
US government money paid for the project setup, which then outsourced production to Finland.
US government money paid for the project setup, which then outsourced production to Finland.
US government money paid for the project setup, which then outsourced production to Finland.
US government money paid for the project setup, which then outsourced production to Finland.
US government money paid for the project setup, which then outsourced production to Finland.
US government money paid for the project setup, which then outsourced production to Finland.
We understand clearly enough.
exactly. On the positve, with this new company, maybe we can finally track down manbearpig.
Who cares, it's a LOAN; as long as they pay it back with interest I feel my tax dollars were better invested than just being thrown at GM or some giant bank that's going to start charging me $5/month to use my money.
As already quoted by Kanluwen in this thread, for those who did not bother to read the article or even watch the video:
In a lengthy interview, Fisker said he apprised the Department of Energy of his decision to assemble the high-priced Karma in Finland after he could not find an American facility that could handle the work.
So when you say:
Frazzled wrote:Yet these guys got shut out? yea...
all you mean is "I don't believe that this Fisker guy is telling the truth." Okay. So how is this about Obama?
Frazzled wrote:On the positve, with this new company, maybe we can finally track down manbearpig.
Finding manbearpig would be great news for Republicans. I mean, if they can find manbearpig then they should be able to find a compelling presidential candidate. It's funny about manbearpig ... it was South Park's attempt to satirize Gore's desperate need to believe in a non-existent problem. Turning it into a verb, I would say that you are trying to "manbearpig" this news story. And damn the facts that might stand in the way.
Manchu wrote:You need to be reasonably informed about topics even in casual discussion and not only when you're defending a dissertation.
So, you're saying I'm wrong? That Al Gore isn't connected with the car company? I thought you were criticizing me because I didn't produce reams of paper to support my position that I heard something.
Manchu wrote:... for the spellcheck ... or should that be spell check?
LOL
Who would have thought that rules must be strictly adhered to on a website where Orks run rampant!
No, I'm saying that Al Gore's involvement with Fisker has nothing to do with the news story from the OP -- which would have been apparent if you posted a source like Frazzled did. Or, at the very least, that source would have introduced some meaningful connection (which you didn't do, leaving implication to do all the work) that could be discussed. As it stands, your post reminds me of Dana Carvey's Church Lady talking about Santa Claus.
Phanatik wrote:May your dice roll 6s, unless it's a Peril roll.
May GW's next Codex be xenos, unless it's your favorite Chapter.
agnosto wrote:Who cares, it's a LOAN; as long as they pay it back with interest I feel my tax dollars were better invested than just being thrown at GM or some giant bank that's going to start charging me $5/month to use my money.
Why do you think they are going to pay it back? Thats euqity and money center lender bank risk. Its a project. I'd love to see what the interest is.
Well, we're borrowing that money to loan to them. Unless we're getting better interest I can think of better things.
Frazzled wrote:Well, we're borrowing that money to loan to them. Unless we're getting better interest I can think of better things.
Now that's a talking point that I can get behind. Forget whether the government should be acting like a private investor -- let's just consider whether we shouldn't demand investments with a quicker turnaround. (Turn around? Help me out, Phanatik.) Was this a good investment? I think that we do need to eventually get the majority of people driving in electric cars for reasons of environmental sustainability and national security. But is this the kind of investment that's going to do it? Shouldn't a condition of this loan, if it was made to create jobs in America, be that jobs should exist by some definite point in America? Or is that constraining the ability of business to the point where no return would be possible on the investment? We have to consider the example that Fisker mentions, of Solyndra.
As always, its easier to get outraged if you leap in feet first, but im sure it makes sense if you really think about it.
If the company assembling in Finland makes it a bigger profit and makes them a success, then the loan gets paid back with interest, and the American company makes loads of cash and pays loads of tax.
Manchu wrote:Finding manbearpig would be great news for Republicans. I mean, if they can find manbearpig then they should be able to find a compelling presidential candidate. It's funny about manbearpig ... it was South Park's attempt to satirize Gore's desperate need to believe in a non-existent problem. Turning it into a verb, I would say that you are trying to "manbearpig" this news story. And damn the facts that might stand in the way.
Wo wo wo, this sounds like you're doubting the existence of manbearpig now. Now you've gone too far.
Manchu wrote:You need to be reasonably informed about topics even in casual discussion and not only when you're defending a dissertation.
So, you're saying I'm wrong? That Al Gore isn't connected with the car company? I thought you were criticizing me because I didn't produce reams of paper to support my position that I heard something.
Both companies have political heavyweights behind them. One of Fisker's biggest financial supporters, records show, is the California venture capital firm Kleiner Perkins Caufield & Byers. The firm financially supports numerous green-tech firms, records show.
Kleiner Perkins partner John Doerr, a California billionaire who made a fortune investing in Google, hosted President Obama at a February dinner for high-tech executives at his secluded estate south of San Francisco. Doerr and Kleiner Perkins executives have contributed more than $1 million to federal political causes and campaigns over the last two decades, primarily supporting Democrats. Doerr serves on Obama's Council on Jobs and Competitiveness. Doerr has not replied to interview requests since March.
Former Vice President Al Gore is another Kleiner Perkins senior partner. Gore could not be reached for comment.
"Their major venture investor is Kleiner Perkins, who has Al Gore as a partner and is certainly politically connected in general," said industry observer Sexton. "Whether that played a role or not is up to the DOE to explain."
He's not connected directly with it, no. If you'd read the news article (specifically: page 3) that Frazzled has posted, you'd see that.
Here's a link to that direct page, however.
And really, even if there is some kind of political backdoor dealing going on--big fething deal. Let's not act like this is "Obammer done played favors for people who helped him!".
Because there's some fingers that can be pointed at the previous administration and the awarding of contracts for PMCs, oil distribution, etc to a well-known company which had ties to a certain VP.
mattyrm wrote: As always, its easier to get outraged if you leap in feet first, but im sure it makes sense if you really think about it.
If the company assembling in Finland makes it a bigger profit and makes them a success, then the loan gets paid back with interest, and the American company makes loads of cash and pays loads of tax.
Its that simple really surely?
No its not.
1. If equity sponsors are not going to invest
2. If corporate lenders who are not going to invest
Then I dare say this is a deal with a company.
Its not benefitting the US.
Its not benefitting US taxpayers.
Why are we loaning money to sports car manufacturers of any make? in the words of the immortal bard
I don't see how selling 100,000 dollar electric cars is really going to help the case for electric/hybrid vehicles. Who can afford them these days besides the '1%'?
mattyrm wrote: As always, its easier to get outraged if you leap in feet first, but im sure it makes sense if you really think about it.
If the company assembling in Finland makes it a bigger profit and makes them a success, then the loan gets paid back with interest, and the American company makes loads of cash and pays loads of tax.
Its that simple really surely?
No its not.
1. If equity sponsors are not going to invest
2. If corporate lenders who are not going to invest
Then I dare say this is a deal with a company.
Its not benefitting the US.
Its not benefitting US taxpayers.
Mate, look at it this way.
The government are greedy as feth. Do they EVER want to give us money?! Do they ever take it easy when we owe them mother fethers anything!? The IRS is like a Yorkshire Terrier if you owe them a dime!
So, stands to reason, some smarter people than us, the type of people with the power to give out billions of dollars, wouldn't give the money out, unless they figured they would get the money back, and then some.
Thats the way it works Frazz! Does the government ever just give money away for no reason at all?
Unless its a monumental cluster feth, but Im pretty sure that this is only gonna be half the story.
chaos0xomega wrote:I don't see how selling 100,000 dollar electric cars is really going to help the case for electric/hybrid vehicles. Who can afford them these days besides the '1%'?
Currently, Fisker's only aiming for that 1%.
Fisker's basically starting by manufacturing a status symbol, something that they can get celebrities touting about, etc.
They (and Tesla) both know that it's going to take awhile before they can get things to such a point where they can make a reliable, mass-produced full electric car.
chaos0xomega wrote:I don't see how selling 100,000 dollar electric cars is really going to help the case for electric/hybrid vehicles. Who can afford them these days besides the '1%'?
Well, considering that the 1% are actually the Borg, it all makes sense. We live to serve them so it doesn't matter if YOU can afford it, as long as some rich person gets a new toy.
chaos0xomega wrote:I don't see how selling 100,000 dollar electric cars is really going to help the case for electric/hybrid vehicles. Who can afford them these days besides the '1%'?
And how is BMW not going to kick their ever loving ass?
Wait, doesn't this violate the 99%er rule? We're funding toys for the uber wealthy! Where are myu toys?
I don't need a $100,000 car. I'll settle for a SAW, 10,000 rounds of ammo, or alternatively if you have an old F4U Corsair in storage, I'll take that. OLD SCHOOL!
chaos0xomega wrote:Who can afford them these days besides the '1%'?
The way it works in America (and perhaps elsewhere) s "monkey see, monkey want." We sometimes call this phenomenon "keeping up with the Jones" but, as fathers-of-the-bride in 2012 will come to realize, the updated terminology is "keeping up with the Kardashians." Leo DiCaprio drives the Karma around the nice neighborhoods and folks who can't quite afford it but will be able to afford the prospectively American-built version start developing (a) brand consciousness and (b) desire (or envy), the gasoline of the consumer market. If you apply Reaganomics to advertisement strategies, there is a "trickle down" of desire/envy that creates a previously non-existent demand for a new product -- the even cheaper Karma. Twenty years ago, only Hollywood stars and defunct royalty carried Louis Vuitton bags. In 2011, your kid sister got one for Christmas.
Meh, I guess, call me a Nazi, but I like Hitlers approach better (regarding Volkswagen), a "People's Car", but I've also never really been one to understand the 'monkey see, monkey want'/'keeping up with the Joneses' malarky (outside of my tabletop gaming activities of course).
Also, why do you think that "monkey see, monkey want" thing works on you regarding wargaming products? It's like an infection, mate, and wanting new models or a nicer car, or whatever, is just the symptom.
Manchu wrote:Hitler didn't shut down Mercedes to open VW.
Also, why do you think that "monkey see, monkey want" thing works on you regarding wargaming products? It's like an infection, mate, and wanting new models or a nicer car, or whatever, is just the symptom.
It works on me in regards to wargaming because its the only thing where I see someone else getting shiny new stuff and it makes me want to get shiny new stuff too. Basically everything else I do/get is only done because I actually want one/have use for it.
I still use an old school plane jane cell phone, and I probably won't upgrade until it reaches the point where I need to be answering emails on short term notice or work has me travelling so often to the point that having my (5 year old) laptop with me all the time would be inconvenient.
I didn't have any sort of digital music device until this past christmas (when I was gifted an iPod).
I'm getting myself an old school piece o' junk car with 130,000 miles because I simply don't see the need to buy something more expensive/newer (despite having had my parents offer to help me fund it, etc.). That said if Jeep decides to bring the 4door Wrangler with diesel engine to the US market I'll probably be first in line.
AustonT wrote: Investing in businesses stretches general welfare a little too far, even for progressives.
Let's not pretend that having the government act like it's a private entity is a "progressive" stance.
I mean except for the part where it is. When the government, as the public sector supports and invests into the private sector they mar the line between the two. Taxes collected in the US are collected under the auspices of providing services by the Government and instead paid to an entity that will not provide you a service and will not sell the government a product it determined it had a need for but a product to the general public. Since American Conservatism is based on the reduction of the public sector and reducing the amount of monies it has available to only that needed to provide government services, yes it is progressive. But even progressives aren't really sure what they are:
At its most basic, economic progressivism supports a mixed economy – an economy that features both a significant public sector and a strong private one.
The economic theory that underpins most of the policies listed above is Keynesian economics. However, many organizations that promote economic progressivism can be characterized as anti-capitalist and include principles and policies based on Marxism, Libertarian Socialism, and other leftwing schools of socio-economic thought.
Are you saying American conservatism is "progressive"? Because American conservatives always seem to be the ones stressing how the US Government should be run as a private business. Most people use the word "progressive" to indicate that the government should not be run that way.
Frazzled wrote:I am annoyed with the US government doing this.
For acting like a good capitalist?
Wait I totally missed this the first go around.
The US Government is not capitalist, and has no right to engage in activities to generate capital. Those are called corporations, partnerships, and proprietorships. Not governments, I can see where your confusion is now.
mattyrm wrote: As always, its easier to get outraged if you leap in feet first, but im sure it makes sense if you really think about it.
If the company assembling in Finland makes it a bigger profit and makes them a success, then the loan gets paid back with interest, and the American company makes loads of cash and pays loads of tax.
Its that simple really surely?
No matty it isn't. Let us look at the options. The last three of each being critical.
A government (doesnt matter which one) pays for a company funds for development then:
A factory owned by the company is built in the donor country.
- The government may or may not get a % of profits.
- The government may or may not get its loan back, or a payback for the grant to unlock new contract opportunities.
- The donor company claims its taxes on the factory
- The donor country claims tax on corporate profits.
- The donor country retains legislative control.
- The donor country can more easily secure sensitive technologies and business information from leakage.
- Jobs are directly created in the donor country.
- Those jobs are taxed by the donor country and the workers pay is mostly spent in the donor country thus recycling the monies invested swiftly into the economy at large.
A factory owned by the company is built abroad (host country).
- The government may or may not get a % of profits.
- The government may or may not get its loan back, or a payback for the grant to unlock new contract opportunities.
- The host country claims the taxes on the factory.
- The donor country and host country share corporation tax on corporate profits.
- The donor and host country share legislative control.
- The company has to share at least part of potentially valuable or sensitive information wirth security bodies of more than one nation.
- Jobs are not seen to be directly created in the donor country.
- Those jobs are taxed by the host country and the workers pay is lost income from the pouint of view of the donor countries economy and tax system.
While public funding of manufacturing may seem a waste there are good reasons to throw money at factories, even failing ones. Notably because most money goes on wages and those wages are taxed recovering immeidately a proportion of the investment equal to the tax rate. Second the money not taxed is usually spent locally, this in turn is taxed or enters the system. Tax evasion and benefits accounts for leakage, as does wage money spent on inported goods and services. However all told a very large percentage of the value of public investment is involved with the size of the factory and the number of workeers it employs.
This is why large factory closures and openings make the news, not for the benefit of the few thousand actually employed but because of the far larger cycle in the economy. However from a politcians point of view making x thousand jobs always looks good, and letting them slip through your fingers has the opposite effect. Expect angry murmers from Senators who beleive that the factroy can (and therefore should) have been built in their region.
The US administration dropped the ball when it offered development funding and failed to secure a manufacturing agreement. It ought to be one of the first things looked at.
AustonT wrote:The US Government is not capitalist, and has no right to engage in activities to generate capital. Those are called corporations, partnerships, and proprietorships. Not governments, I can see where your confusion is now.
We're not talking about what one thinks the government does or does not have the right to do. We're talking about what it actually does, regardless of who is in power -- and for that reason, what it will continue to do.
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Orlanth wrote:The US administration dropped the ball when it offered development funding and failed to secure a manufacturing agreement. It ought to be one of the first things looked at.
According to Fisker, Solyndra failed because it spent nearly all of the loan money on building a factory in the US.
Manchu wrote:Are you saying American conservatism is "progressive"? Because American conservatives always seem to be the ones stressing how the US Government should be run as a private business. Most people use the word "progressive" to indicate that the government should not be run that way.
They mean efficiently, not like running their own bank to fund sports cars.
Why are we loaning money for the electric version of Ferrari again? If we lose 20% (Recovery rate of 2-3 which is way better than these jokers will get) thats $200MM down the whole. How many chemo treatments is that? Lets see its costs $487 per chemo for lung cancer that a Medicare patient has to pay out of pocket.
$200,000,000 / $487 = 410,677 treatment copays. If we figure the average of 7 chemos per patients thats 58,667 Seniors who could have just had their chemo treatments paid.
Tell them this is a good idea.
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Manchu wrote:
AustonT wrote:The US Government is not capitalist, and has no right to engage in activities to generate capital. Those are called corporations, partnerships, and proprietorships. Not governments, I can see where your confusion is now.
We're not talking about what one thinks the government does or does not have the right to do. We're talking about what it actually does, regardless of who is in power -- and for that reason, what it will continue to do.
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Orlanth wrote:The US administration dropped the ball when it offered development funding and failed to secure a manufacturing agreement. It ought to be one of the first things looked at.
According to Fisker, Solyndra failed because it spent nearly all of the loan money on building a factory in the US.
The fact they think that is the problem, is its proof their management is as inept as I thought they were.
Frazzled wrote:Why are we loaning money for the electric version of Ferrari again?
Why do you insist on obscuring the actual topic? I mean, you can still make good points while remaining grounded in the story at hand. The luxury car is a logical first step. Small production means high costs, which must be passed on to the consumer. Since the cost is already so high, it needs to be justified by design choices -- basically making it not just an expensive electric car but a luxurious electric car. See the difference? The first option is not desirable to anyone. The second one is. I know this isn't as mystifying to you as you are making it seem with your gak-stirring slogans.
So how about you look at this post again instead of pretending that we didn't just spend three pages clarifying what the actual issue was, which you should have known anyway by being the first person to (presumably) read and then post the story:
Manchu wrote:
Frazzled wrote:Well, we're borrowing that money to loan to them. Unless we're getting better interest I can think of better things.
Now that's a talking point that I can get behind. Forget whether the government should be acting like a private investor -- let's just consider whether we shouldn't demand investments with a quicker turnaround. (Turn around? Help me out, Phanatik.) Was this a good investment? I think that we do need to eventually get the majority of people driving in electric cars for reasons of environmental sustainability and national security. But is this the kind of investment that's going to do it? Shouldn't a condition of this loan, if it was made to create jobs in America, be that jobs should exist by some definite point in America? Or is that constraining the ability of business to the point where no return would be possible on the investment? We have to consider the example that Fisker mentions, of Solyndra.
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Frazzled wrote:
Manchu wrote:According to Fisker, Solyndra failed because it spent nearly all of the loan money on building a factory in the US.
The fact they think that is the problem, is its proof their management is as inept as I thought they were.
You're going to have to clarify. You think that Fisker's management is inept for looking at another company's business plan, which isn't working, and deciding to try a different approach?
Manchu wrote:Are you saying American conservatism is "progressive"? Because American conservatives always seem to be the ones stressing how the US Government should be run as a private business. Most people use the word "progressive" to indicate that the government should not be run that way.
I had to reread my thing to catch where you might have gotten the idea I was calling conservativism progressive.
Without the quote box it's here with red added for a poorly constructed train of thought.
Since American Conservatism is based on the reduction of the public sector and reducing the amount of monies it has available to only that needed to provide government services, yes it loaning money to the private sector is progressive.
Two separate thougts that should have been separated by punctuation and full sentences.
Yes the republicans advocate running the government like a business, yes this kind of nonsense goes on under both parties. You can make the argument both parties are in fact progressive, I'd rather not today.
The basic point of conservatism is to restrict or return the government to it's most basic constitutional powers. Different conservative groups subscribe to that policy at varying levels.
The basic point of progressivism is to push the limits of the current government to standard and to "progress" to a new one.
Progressivism and Progressives are not synonymous with how the government shouldn't be run, it's a political ideology. One I don't happen to agree with but not "wrong" per se.
but back to my original statement, loaning money to private business stretches the definition of general welfare even for progressives (people who want to progress and change wha taxes can or should be spent on, regardless of party affiliation)
Orlanth wrote:The US administration dropped the ball when it offered development funding and failed to secure a manufacturing agreement. It ought to be one of the first things looked at.
According to Fisker, Solyndra failed because it spent nearly all of the loan money on building a factory in the US.
Not really relevant. The loan was half a billion dollars, that in itself buys a lot of negotiating power for the donor government.
If the loan money was wasted on a failed project then it wasnt managed well. It looks like it was used as tea money: Poorly monitored government loans and grants are often taken to be throw away experimental money in the minds of companies, to be dumped into a project which can then be written off if it doesnt work leaving the government to pay the price. When the companies own money is used more care ansd attention is taken, correct monitoring is therefore required. got half a billion in funding then you should have a business plan worth that level of investment and the trade department should see that the project is sound. If there is a whiff that the government funding is just being used as a dry run prior to independent corporate funding that it time to put in controls.
Fair controls normally mean manufacturing site agreements, and possibly state negotiated wage minimums. That is not a lot to ask for, and that should be enough to ensure that the investment is, in general, of public/state benefit.
AustonT wrote:Yes the republicans advocate running the government like a business ... You can make the argument both parties are in fact progressive ...
Yes, I could but you basically just spelled it out there yourself.
... I'd rather not today.
Okay, but you just did.
The basic point of conservatism is to restrict or return the government to it's most basic constitutional powers.
That's the most recent point, the Tea Party point. It's not Dwight Eisenhower or even Ronald Reagan conservatism, however.
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Orlanth wrote:Poorly monitored government loans and grants are often taken to be throw away experimental money in the minds of companies, to be dumped into a project which can then be written off if it doesnt work leaving the government to pay the price.
That simply doesn't make sense in the case of Fisker nor is it even what happened. They are trying to create a new industry. Like Solyndra, Fisker's continued existence depends on doing so. The money was loaned to research and design a new car. It was used to do just that. Whether they can pay back the loan is partly contingent on their other costs -- such as manufacturing costs.
Sure, you can say that Fisker is just a sham company abusing loans -- but you can't back that up in this case at all. If anything is irrelevant, it's that claim. It's like Frazzled saying that Fisker is a liar. Maybe he is. There is nothing in any article yet linked here to indicate that it's the case.
Frazzled wrote:Why are we loaning money for the electric version of Ferrari again?
Why do you insist on obscuring the actual topic? I mean, you can still make good points while remaining grounded in the story at hand. The luxury car is a logical first step. Small production means high costs, which must be passed on to the consumer. Since the cost is already so high, it needs to be justified by design choices -- basically making it not just an expensive electric car but a luxurious electric car. See the difference? The first option is not desirable to anyone. The second one is. I know this isn't as mystifying to you as you are making it seem with your gak-stirring slogans.
Obfuscating nonsense. At the end of the day a Ferrari startup got a loan to make electric Ferraris in another country to be sold to rich pukes who wouldn't give me the time of day. They aren't going to get bigger. They aren't going to make money. The loss the US will incur will be significant and could have gone to far better uses.
Further, the technology is there. More inexpensive (relatively ) electric cars are already available (and being ignored). Give it up. This was a Ferrari manufactured who got crony money with the help of friends in high places from a department being run like their private piggy bank.
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Frazzled wrote:
Manchu wrote:According to Fisker, Solyndra failed because it spent nearly all of the loan money on building a factory in the US.
The fact they think that is the problem, is its proof their management is as inept as I thought they were.
You're going to have to clarify. You think that Fisker's management is inept for looking at another company's business plan, which isn't working, and deciding to try a different approach?
1. Solyndra bought the farm because they had the finest in 20th century technology. The competition is building better products with labor costs substantially less than anything outside Asia. Even if built in Asia the technology was the equivalent of rotary phone vs. digital. They had no chance.
2. Why on earth do you think a company is going to have cheaper manufacturing costs in Finland? If thats their big thing they would build the plant anywhere but western Europe.
Manchu wrote: That's the most recent point, the Tea Party point. It's not Dwight Eisenhower or even Ronald Reagan conservatism, however.
No it's a conservative point. Dwight Eisenhower was a progressive republican. That's like trying to throw out Teddy Roosevelt as a conservative. The closest one is Reagan and it's not even that close. There's a difference between what someone calls themselves and what they are.
If you are going to go out throwing labels call a duck a duck.
Government investment in private industry is progressive.
Conservatism is mostly about trying to control peoples' lives via social laws (IE banning gay marriage, banning abortion, forcing people to pray in school, etc-- basically force their backwards religious views on everyone else in the form of laws, rules, and regulations, in most cases, but communism was also conservative in this regards).
I think you're referring to "right wing" rather than "conservative". No, the two are not the same.
Frazzled wrote: rich pukes who wouldn't give me the time of day.
A little beside the point, but the "1%" aren't all evil characters cuddling cats and plotting your doom. Sure some of them are dicks, but 66% of all charitable donations are made by that 1%. so clearly at least some of them care. it's also fair to include that I probably would not be so generous were I to become rich.
Frazzled wrote: rich pukes who wouldn't give me the time of day.
A little beside the point, but the "1%" aren't all evil characters cuddling cats and plotting your doom. Sure some of them are dicks, but 66% of all charitable donations are made by that 1%. so clearly at least some of them care. it's also fair to include that I probably would not be so generous were I to become rich.
Truly. However, if you're shelling out $100,000 for an electric sports car, you're going to be an aforementioned rich puke who wouldn't give me the time of day.
Frazzled wrote:At the end of the day a Ferrari startup got a loan to make electric Ferraris in another country to be sold to rich pukes who wouldn't give me the time of day.
For the third time, it's not the end of the day. You say that this company will not succeed, will not get bigger, will not produce cars that people like yourself could afford. Can you lend me your crystal ball? I'd like to know the future as clearly as you do. And before you say you're just going on similar past cases, remember that the same anti-American "can't do" spirit could have been applied to Henry Ford.
Frazzled wrote: Why on earth do you think a company is going to have cheaper manufacturing costs in Finland?
Because it is. The options were: use a factory that already exists in Finland or build a new one in the US.
@AustonT: You're definition of conservative is so narrow that it is irrelevant. I don't mean that in the sense of a throw-away insult, either. I mean that if you only mobilized a political party on that one point you'd never win elections much less offer candidates capable of running the government. The Republican Party is much bigger and more diverse than the Tea Party, as the Republican Party will find out on the way to November 2012.
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AutsonT wrote:Sure some of them are dicks, but 66% of all charitable donations are made by that 1% ...
Thanks to "progressive" tax policies.
... so clearly at least some of them care.
I don't dismiss the rich as uncaring. But they have a stake in it, which isn't a bad thing. I'm all for the government enforcing policies which give the rich very, very strong incentives to be philanthropic.
Frazzled wrote:Truly. However, if you're shelling out $100,000 for an electric sports car, you're going to be an aforementioned rich puke who wouldn't give me the time of day.
If the $100,000 car paves the way for the $80,000 car, then the $50,000 car, then the $30,000 car, etc, etc, then that would be progress. You know, kind of like how the PC used to require a specially constructed building and a team of engineers and gradually over time demand and advances caused by said demand drove development of better, cheaper computers.
Every technology starts expensive - just look at TFT/LCD monitors, plasma TV's, etc. I remember when plasma TV's were £10,000, now larger, better versions are down at the £2-3,000 mark. Hell, my first LCD monitor was over £300, now I can pick up a screen which is better in every way for less than half the price.
Melissia wrote:Conservatism is mostly about trying to control peoples' lives via social laws ... forcing people to pray in school, ...
I believe this is the 2nd time in the recent past you have posted this.
You are either ignorant of the true position, or you are being deliberately disinformative.
Conservatives/right-wingers want people to have the right to pray in school, not force people to pray in school. I think you should be able to tell the difference.
SilverMK2 wrote:Every technology starts expensive - just look at TFT/LCD monitors, plasma TV's, etc. I remember when plasma TV's were £10,000, now larger, better versions are down at the £2-3,000 mark. Hell, my first LCD monitor was over £300, now I can pick up a screen which is better in every way for less than half the price.
This is exactly why, despite what Frazzled may think, I love capitalism. Capitalism makes populism possible. God bless the USA!
Frazzled wrote:Truly. However, if you're shelling out $100,000 for an electric sports car, you're going to be an aforementioned rich puke who wouldn't give me the time of day.
If the $100,000 car paves the way for the $80,000 car, then the $50,000 car, then the $30,000 car, etc, etc, then that would be progress. You know, kind of like how the PC used to require a specially constructed building and a team of engineers and gradually over time demand and advances caused by said demand drove development of better, cheaper computers.
But it raises the question of whether or not that same type of automobile is not already achievable for 30,000 or less. We know its possible (given the existence of other electric cars at a similar price point), and if so, then why would the initial offering, paid for primarily by the tax dollars of the other 99%, be made available exclusively for the 1%? I consider it a misappropriation of tax dollars
For the third time, it's not the end of the day. You say that this company will not succeed, will not get bigger, will not produce cars that people like yourself could afford. Can you lend me your crystal ball? I'd like to know the future as clearly as you do. And before you say you're just going on similar past cases, remember that the same anti-American "can't do" spirit could have been applied to Henry Ford.
1. I make corporate loans for a living (Plea to authority). No financial institution would touch this as the risk is too high. Its equity level risk. Let private capital be raised and quit taking money from better uses, like saving lives.
2. It sets up a new market.
For rich people. This is not the business of the US government.
3. It will expand to more moderate vehicles.
No it doesn’t. They are a dwarf compared to a genuine car company. Further they have several car companies already selling electric cars, including companies the US already has stakes in. Further, those companies have plants in the US. Even if Fisker wins, the US loses as those employees would be…unemployed.
The more this is discussed, the dirtier this deal sounds.
Because it is. The options were: use a factory that already exists in Finland or build a new one in the US.
Or use a factory that already exists in the US. Hell I heard GM shut a few plants and we own those bastards.
Please stay on-topic. This isn't about prayer in classrooms, although one could certainly open another thread on the topic if they really wanted to. Thanks!
SilverMK2 wrote:If the $100,000 car paves the way for the $80,000 car, then the $50,000 car, then the $30,000 car, etc, etc, then that would be progress.
Thats all well and good right up to the moment you look on the internet and realize we already have them. Leaf, Volt ring a bell?
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Manchu wrote:
SilverMK2 wrote:Every technology starts expensive - just look at TFT/LCD monitors, plasma TV's, etc. I remember when plasma TV's were £10,000, now larger, better versions are down at the £2-3,000 mark. Hell, my first LCD monitor was over £300, now I can pick up a screen which is better in every way for less than half the price.
This is exactly why, despite what Frazzled may think, I love capitalism. Capitalism makes populism possible. God bless the USA!
and its already occurred-Leaf/Volt. I love capitalism. This wasn't an example of it.
SilverMK2 wrote:Though unfortunately it does mean that some technologies are lost to history, despite arguably being more promising than the tech that took off.
Absolutely, hence why the US government is loaning half a billion to Fisker instead of us all driving electric cars already. But we have to be willing to accept some drawbacks for other benefits. No one can say the gas-powered automobile hasn't been a very useful thing, even in terms of making this country a more equitable place. If the drawbacks are starting to outweigh the benefits to the nation, then the nation needs to re-consider its relationship to the gas-power automobile -- and that's what it's doing. I said I was a capitalist, not an Objectivist.
Phanatik wrote:Conservatives/right-wingers want people to have the right to pray in school, not force people to pray in school.
Bullgak they don't.
Conservatives work every day in Texas to try to force prayer sessions into an already limited classtime in school.
I can't say if that's true or not, as I haven't lived there since 1986.
Even so, your blanket statement about conservatives should be amended to "Texas conservatives want to force people to pray in school." I would support condemnation of that. I'm an atheist, but I think people should have the right to pray wherever they want to.
Further they have several car companies already selling electric cars, including companies the US already has stakes in.
Why hasn't the Volt sold? Because it is an expensive but not luxurious electric car. Because, without the luxury or the cache, all you can rely on is Americans genuinely putting long-term environmental goals ahead of their everyday needs to sruvive and thrive. Ain't gonna happen. Fisker is trying something different.
SilverMK2 wrote:If the $100,000 car paves the way for the $80,000 car, then the $50,000 car, then the $30,000 car, etc, etc, then that would be progress.
Thats all well and good right up to the moment you look on the internet and realize we already have them. Leaf, Volt ring a bell?
Sure, but take a look at the features on the $100,000 car as compared to the current crop of $30,000 cars - newer battery tech, more efficient recharging, etc, etc. Premium cars command premium prices and give a better return despite, in many cases, not being too much more to produce than the stock cars.
Kind of like the multipart Orks vs the AOBR orks - same materials, same kind of production costs, yet one sells for significantly more than the other. The mark up on the "luxury" version helps fund development more than the sale of "X" number of sales of the basic version (well, in the case of GW models, it actually funds Kirby's retirement, but you get the idea).
Not to mention (oh wait, it already has ) the luxury versions of products attract the kinds of names that can make or break brands.
I took it as an insult, and I'm glad you added that bit. I felt my blood start to boil and then cool of. But conservatism is:
Conservatism (Latin: conservare, "to preserve")[1] is a political and social philosophy that promotes the maintenance of traditional institutions and supports, at the most, minimal and gradual change in society. Some conservatives seek to preserve things as they are, emphasizing stability and continuity, while others oppose modernism and seek a return to the way things were.
Conservatism in the United States includes a variety of political ideologies including fiscal conservatism, supply-side economics, social conservatism, libertarian conservatism, bioconservatism and religious conservatism
US president Ronald Reagan, who was a self-declared conservative, is widely seen as a symbol of American conservatism.[86] In an interview, he said "I believe the very heart and soul of conservatism is libertarianism."
Libertarianism includes diverse beliefs, all advocating strict limits to government activity and sharing the goal of maximizing individual liberty and political freedom.
I did say
The basic point of conservatism is to restrict or return the government to it's most basic constitutional powers.
Manchu wrote:Please stay on-topic. This isn't about prayer in classrooms, although one could certainly open another thread on the topic if they really wanted to. Thanks!
Manchu interposes a prayer of relief... from prayers. Awesome. Time to celebrate this thread turning to awesome.
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Manchu wrote:
Further they have several car companies already selling electric cars, including companies the US already has stakes in.
Why hasn't the Volt sold? Because it is an expensive but not luxurious electric car. Because, without the luxury or the cache, all you can rely on is Americans genuinely putting long-term environmental goals ahead of their everyday needs to sruvive and thrive. Ain't gonna happen. Fisker is trying something different.
Selling really godawful expsnive cars, just like BMW. Yea, that will work. thats much better than making chemo cheaper.
@AustonT: I'm not saying that libertarianism isn't a brand of conservatism. I'm just saying it's no more an authentic version of conservatism than how Ronald Reagan actually ran the government, i.e., huge spending creating huge government. (As you noted, people are not necessarily what they claim to be.) I think that this funding of design for an electric car could be characterized as "conservative" just as easily as it could be characterized as "progressive" or "liberal."
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Frazzled wrote:Selling really godawful expsnive cars, just like BMW. Yea, that will work. thats much better than making chemo cheaper.
BMW seems to be doing pretty well in America. Also, I'm alll for cheaper chemo treatments but these Republicans keep blocking it ... and a half billion loan to try and address other pressing concerns (environmental sustainability, national security, longterm unemployment) isn't a mutually exclusive of cheaper healthcare. (Health care? health-care? Where are you, Phanatik?) Do you really think we live in a world where we can only pick one problem to address at a time?
Manchu wrote:@AustonT: I'm not saying that libertarianism isn't a brand of conservatism. I'm just saying it's no more an authentic version of conservatism than how Ronald Reagan actually ran the government, i.e., huge spending creating huge government. (As you noted, people are not necessarily what they claim to be.) I think that this funding of design for an electric car could be characterized as "conservative" just as easily as it could be characterized as "progressive" or "liberal."
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Frazzled wrote:Selling really godawful expsnive cars, just like BMW. Yea, that will work. thats much better than making chemo cheaper.
BMW seems to be doing pretty well in America. Also, I'm alll for cheaper chemo treatments but these Republicans keep blocking it ... and a half billion loan to try and address other pressing concerns (environmental sustainability, national security, longterm unemployment) isn't a mutually exclusive of cheaper healthcare. (Health care? health-care? Where are you, Phanatik?) Do you really think we live in a world where we can only pick one problem to address at a time?
Not to point fingers or anything, but if certain people can go off-topic to define conservatism, then we should be able to resurrect the right to religion discussion. tee hee
@Phanatik: Well, the difference is that the subject of the thread -- government investment in private industry -- is being called "progressive" or "liberal" and, for that reason, is being decried. But I think it can also be called "conservative," in the sense that this is an example of the government acting like a private business -- yes, a private business with many more resources than most others but stiil. So it's not really off-topic, like forcing/allowing kids to pray in school, which has zero bearing on the news at hand.
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Frazzled wrote:dollars are finite. Those dollars went to this crony capitalist boondoggle. They didn't go to lower premiums for old people.
Neither did the dollars used for a lot of other things.
To be fair, Frazzled says he hates Republicans, too. We need critics as well as doers. Voting isn't just about what you want to happen (which is, totally coincidentally, I'm sure, a major theme among actual Republicans right now) but also about what you don't want to happen. That's what's so funny about this electric car business is that it's not really a partisan issue at all.
With an investment of $7.5 billion, Bush and Congress underwrote $25 billion in loans that's translated directly into the Leaf, the Volt, Ford's electric Focus, the Think City, and Tesla and Fisker's leap from paper to plant. Now, almost five years later, we have mass-market electric cars. It's anathema for some progressives to give Bush credit for anything--just as it's anathema for more strident conservatives to see any good coming from any social engineering. They didn't like his prescription-drug coverage, either.
Party of "NO" indeed. Not until recently, IMO. I like Barak Obama now. And I liked George Bush then. But I don't like the Tea Party. If you want my vote, start living in the real world -- where we need to act like grown-up capitalists in a mixed economy.
Phanatik wrote:Conservatives/right-wingers want people to have the right to pray in school, not force people to pray in school.
Bullgak they don't.
Conservatives work every day in Texas to try to force prayer sessions into an already limited classtime in school.
Conservative is not the same thing as right wing. Only in the deluded "everything is left or right" mindset of the mass media is this true.
Umm I think if anyone has conservative and right wingers confused it's you. You're espousing the views of the Religious right as conservative. So a large portion of your conservatives in your state are pushing for prayer in school, tha would violate church and state separation that are traditional values of our country. Therefor preserving separation is a conservative view and changing it is progressive.
This thread isn't about espousing what happens in Texas schools it's about loaning half a billion dollars to a car company, using either the full faith and credit of the US not to pay our debt but to gamble on private industry or to use tax dollars raised for the common defense or the general welfare but utilized to subsidize private industry. In which case conservatives side towards not making these loans, and progressives side towards making them.
It's a big part of the background of this issue. If Fiskars made say, a cancer treatment you could argue that the American peoples welfare was the reason for that spending, it's a stretch but there it is.
To loan either tax dollars or already loaned monies (for which tax dollars pay the interest) to a company that MAY develop as Manchu as said into a solvent electric car builder, currently employing overseas labor instead of retooling the Saturn plant that they bought, to sell a service with no direct benefit and at a huge risk is a questionable decision at best.
Manchu wrote:Do you really think we live in a world where we can only pick one problem to address at a time?
dollars are finite.
The amount of dollars you can invest in any given thing to produce "progress" is also limited. You can't magic things to happen by throwing money at it. Cutting edge medical research takes years to filter through to the front lines of medicine and has the same problems as your $100,000 car, or the £10,000 plasma TV. New medical technology costs a fortune because it is new. It is the reason not every hospital will have a PET scanner, because the cyclotron you need to make the radioactive isotopes for certain scans is hideously expensive.
But even if things went from the lab to the clinic instantly at the same cost as the old treatments, there are still only a fixed number of labs working on the problem, a fixed number of scientists and engineers in the field, etc, etc.
At the end of the day any over-investment will give diminishing returns.
AustonT wrote:To loan either tax dollars or already loaned monies (for which tax dollars pay the interest) to a company that MAY develop as Manchu as said into a solvent electric car builder, currently employing overseas labor instead of retooling the Saturn plant that they bought, to sell a service with no direct benefit and at a huge risk is a questionable decision at best.
I absolutely agree that it is a questionable decision. Thank you very much for setting out the actual issue to be discussed with nary an ounce of sensationalism.
Where we disagree is regarding how much "distance" between investment and recoup separates a risk-worthy benefit from one that isn't. We also disagree inasmuch as you think this distance is determinative of the investment's constitutionality.
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Phanatik wrote:Well, how about we stop calling them "electric" cars, and start calling them what they reallly are: coal-powered cars.
Phanatik wrote:Well, how about we stop calling them "electric" cars, and start calling them what they reallly are: coal-powered cars.
Or wind powered cars, or solar powered cars, or geothermal powered cars. I don't know what the US energy policy is, but elsewhere in the world we are trying to get as much renewable energy into the national grid as possible. Most of the USA is pretty much wasteland - plenty of room for alternate power generators and get you weaned off oil, coal and gas.
Orlanth wrote:Poorly monitored government loans and grants are often taken to be throw away experimental money in the minds of companies, to be dumped into a project which can then be written off if it doesnt work leaving the government to pay the price.
That simply doesn't make sense in the case of Fisker nor is it even what happened. They are trying to create a new industry. Like Solyndra, Fisker's continued existence depends on doing so. The money was loaned to research and design a new car. It was used to do just that. Whether they can pay back the loan is partly contingent on their other costs -- such as manufacturing costs.
Sure, you can say that Fisker is just a sham company abusing loans -- but you can't back that up in this case at all. If anything is irrelevant, it's that claim. It's like Frazzled saying that Fisker is a liar. Maybe he is. There is nothing in any article yet linked here to indicate that it's the case.
Sorry, you are misreading this. I mentioned nothing about Fisker being a sham company, tea money doesnt mean that. Now some companies do cook up a hairbrained project that looks good in polticalspeak and gets a budget to waste. However more often its simply applying human nature. You are more careful with your own than with a handout. Its like house maintenance, tennancy properties get damaged quicker and more easily because less care is placed into living in them than a homeowner would. This doesnt indicate that as a rule tennants trash houses, not at all, its just human nature to take care with your own more than with what is not.
Likewise I am not accusing Fisker of smoking their budget loan, I am suggesting they didnt care so much when spending it because its not their money to start with and ultimately they wont have to pay if it does indeed go up in smoke. This attitude adds to business risk considerably but can be countered by careful monitoring and clauses to ensure that the governments agenda (build the factory in the US) is attained either with the loan money and/or with subsequent private investment.
Phanatik wrote:The thing is, we are loaded with oil, coal and gas. That's why the others aren't commercially viable, and can only exist with government support.
Regards,
So, nothing to do with the oil/power/etc companies essentially having bought and paid for your entire government?
Orlanth wrote: You are more careful with your own than with a handout.
When you go to the bank and get a loan, is that a handout? No. Getting a loan from the government is not one either. If your borrow from Merrill and your business successfully files for bankruptcy, you don't pay back Merrill, either. Whether or not the Fisker company will succeed and be able to pay back the loan -- along with making tidy profits -- is conditioned upon how it uses its capital. So either Fisker is not a sham company and it will be careful with its capital (inlcuding the "handout" money) or it is a sham company and isn't careful with its capital.
To use your analogy, when I get a tax credit for installing energy-efficient windows in my house I don't consider it a "handout" and spend it willy-nilly. Unless the windows were fictitious and all part of my evil plan.
Phanatik wrote:The thing is, we are loaded with oil, coal and gas. That's why the others aren't commercially viable, and can only exist with government support.
Regards,
So, nothing to do with the oil/power/etc companies essentially having bought and paid for your entire government?
You have to watch those evil etc companies. They are serious holes.
Phanatik wrote:The thing is, we are loaded with oil, coal and gas. That's why the others aren't commercially viable, and can only exist with government support.
Regards,
So, nothing to do with the oil/power/etc companies essentially having bought and paid for your entire government?
I'll have you know, Sir, that we have gridlock because our politicians have been bought and paid for by everyone!
When you go to the bank and get a loan, is that a handout?
***I care less than I do if its my own money. I care really less if its unsecured financing.
If your borrow from Merrill and your business successfully files for bankruptcy, you don't pay back Merrill, either.
***Thats not correct. Debtholders will be paid before equity holders (unless you're Chu who approved the Solyndra WTF!!!). Debt will generally be converted to equity or alternatively the company is borken up with debt holders getting their best % of proceeds.
Whether or not the Fisker company will succeed and be able to pay back the loan -- a long with making tidy profits -- are conditioned upon how it uses its capital. So either Fisker is not a sham company and it will be careful with its capital (inlcuding the "handout" money) or it is a sham company and isn't careful with its capital.
***Or its a startup like a thousand other startups that bites the farm because its in a bad industry, or someone makes a better widget than they do.
Phanatik wrote:Well, how about we stop calling them "electric" cars, and start calling them what they reallly are: coal-powered cars.
I'd prefer nuclear-powered, myself.
Since we are dreaming, I'd prefer cold fusion.
Regards,
REALLY?
The only thing stopping nuclear power in America is the American people. The Palo Verde plant produces something like 35% of the electricity in Arizona, (yeah Wikipedia I didn't pull that gak out of my ass) and at least some of the power for California. If you want to relate it to power generation that plant cost nearly 6 billion dollars, 12 investments like this one could pay for one to actually serve...say LA.
The Department of Energy should be investing in updating and building nuclear and hydroelectric power. The dams and/or the power generation infrastructure in Great Falls and Black Eagle, MT and Hoover Dam need to be replaced, same/same replace or update nuclear power facilities in the US.
Again as it relates to spending and this particular case a loan or government interest in power GENERATION facilities I could get behind and push. It's directly beneficial to the general welfare of the people. If government funds are used it should be regulated, operated, and managed by a public company (read state owned). If the people pay for it they should own it, I may not agree with it but it's how it should be.
AustonT wrote:If you want to relate it to power generation that plant cost nearly 6 billion dollars, 12 investments like this one could pay for one to actually serve...say LA.
As I already indicated, mate, I'm all for it. But, as you know (just ask Bush and Obama), "nuclear facility" isn't nearly as sexy as "electric car" to the aforementioned enormously recalcitrant electorate.
First of all Frazzled I say it like that, it's deeply ingrained and I cant make it stop.
@ Manchu, I'm not always disagreeing with everything said. Theres some things that are ok and some that arent. The government isn't a capital investor, but building and maintaining infrastructure for the general welfare is a part of thier mandate. If guaranteeing cheap power can only be done through government ownership then so be it.
@Dogma (and Manchu about nuclear facilities) I'm more than willing to admit I can fail to get my point across sometimes. I say the only thing standing in the way of nuclear power is the American people because it has been sensationalized into unpopularity. Even people who would like nuclear power just don't want it in thier backyard. it has obvious benefits, and equally obvious risks. But as well regulated as nuclear energy is here in the US it's safe barring act of god accidents. You know like a record breaking earthquake followed by a typhoon. Fukajima got a bad rap for not predicting what most people had agreed was impossible.
You wouldn't think it would be hard to pitch nuclear energy, half the cost of coal but double the cost of hydro power, can be built anywhere and can run off unreclaimed sewage. It does lack the sex appeal of electric sports car. Which is endemic of the people we elect to office...different rant.
Even easier to pitch would be rebuilding hydroelectric power again the purvue of the DoE, but instead firmly regulated publically owned energy companies were allowed to privatize and feth over the people who paid to have the dams. So instead of investing in permenant renewable energy, sold at cost or using small profits to fund more cyclic renewal of public infrastructure we invest in the electric DeLorean? That worked so well for Ireland
AustonT wrote:The government isn't a capital investor
On the contrary, the government invests vast sums of money into various projects which may or may not "pay out" at the end, into research and development, into social reform, etc. One could say that the government is the ultimate capital investor, investing money for the potential good of society, rather than purely because they think it will make them profit.
Orlanth wrote: You are more careful with your own than with a handout.
When you go to the bank and get a loan, is that a handout? No. Getting a loan from the government is not one either. If your borrow from Merrill and your business successfully files for bankruptcy, you don't pay back Merrill, either. Whether or not the Fisker company will succeed and be able to pay back the loan -- along with making tidy profits -- is conditioned upon how it uses its capital. So either Fisker is not a sham company and it will be careful with its capital (inlcuding the "handout" money) or it is a sham company and isn't careful with its capital.
To use your analogy, when I get a tax credit for installing energy-efficient windows in my house I don't consider it a "handout" and spend it willy-nilly. Unless the windows were fictitious and all part of my evil plan.
Government loans and bank loans are not the same thing.
Banks can and do lend half a bilion, but the bank will want its investment back, and it will want the interest paid. All of it. Bankers will also have their own guys in place to ensure they can pull the plug if they see the investment going down the toilet so as not to throw good money after bad.
Government loans are different, you can offset replayments simply by convincing a minister to do so, or getting a lobbyist to convince the media to comnvince the puvblic to convince the minister etc. Loans are not looked at quite so stringently and are often written off for the public good. A bank cares abnout the investment capital and interest alone, a government cares about the project, especailly if it employs people or has potential to do so. A bank doesnt give a feth how many people a project employs, who they vote for when the election is and whether they have effective lobbyists.
Many many government loans tuirn into de facto grants, or are written off. Most tellingly of all a large scale investor can blow a government loan on a huge project then get another one. That doesnt happen with banks. In fact often the mentality is the bank loan is the real one, you government loans are 'practice', this is why an investor can secure a bank loan after a government loan, but not after another bank loan. The only exception to this is when a project appears to be a failure but the banks at least got their money, normally this involves government bail outs of some description.
However all this need not be so, competent government can exist and large scale capital investment deserves it. The Germans and Japanese are effective in this regards, and it tells in their economies, just look at the Euro crisis, many government want to just sign off on it. It was the Germans that looked through the bills. The UK handled public financing of companies appallingly, the French even worse. However even the French are not so laid back as to miss out on manufacturing site clauses when they sign a funding agreement.
SlaveToDorkness wrote:Sounds about right for D'Ohbama.
Indeed, Taxbama is truly history's greatest monster.
On a side note, it appears that the DoE knew that the initial run would be made overseas, but that a chunk of the loan - $170 million - in engineering and development costs would be spent in California, and the vast majority of the rest of the loan would be used in Wilmington, DE for the later run, which will create 2k to 2.5k new jobs.
Also, the program that made these loans gave Ford $11 for every $1 Fisker got. For what that's worth.
AustonT wrote:The government isn't a capital investor
On the contrary, the government invests vast sums of money into various projects which may or may not "pay out" at the end, into research and development, into social reform, etc. One could say that the government is the ultimate capital investor, investing money for the potential good of society, rather than purely because they think it will make them profit.
I respect you and I respect your opinion, but mine is that the government is not a capital investor and should not engage in investment practices. Jus because they do, doesn't mean they should. If you and I belonged to a home owners association and I collected dues from you (and the other neighbors) to maintain the comment park and garden. And instead I let the park fall into disrepair and loaned the money to a start up company with an empty warehouse to develop artificial turf for the park, wouldn't you be a little angry at me?
AustonT wrote:I respect you and I respect your opinion, but mine is that the government is not a capital investor and should not engage in investment practices. Jus because they do, doesn't mean they should.
I agree with this, generally speaking. My feeling is that the best role of government is when it provides an even playing field for the players. Lending money to any of them (but not all of them) edges them closer into picking winners and losers.
Some exceptions, of course. I don't have a problem with the government subsidizing enterprises that are unprofitable that are otherwise clearly in the public benefit, such as, example, flu vaccine that is expensive or difficult to produce that drugmakers are reticent to do so when they could be making more profitable stuff, like viagra or whatever. In narrow exceptions like this, it's a little different in my opinion.
Eh when we start talking about drug companies, how, what, and how much they do. We enter a whole different discussion. In which no one, and I do mean no one. Will like where I stand.
AustonT wrote:
I respect you and I respect your opinion, but mine is that the government is not a capital investor and should not engage in investment practices. Jus because they do, doesn't mean they should. If you and I belonged to a home owners association and I collected dues from you (and the other neighbors) to maintain the comment park and garden. And instead I let the park fall into disrepair and loaned the money to a start up company with an empty warehouse to develop artificial turf for the park, wouldn't you be a little angry at me?
That would be an explicit misappropriation of funds, which is very different from using funds rendered to the state for its discretionary use as discretionary funds.
Kilkrazy wrote:Should the US government have invested in;
The Hoover Dam
The Manhattan Project
The Lake Portchartrain Levee
NASA
...?
PFFFT! What? Why would the government invest in THAT stuff?! Those are needless commodities compared to this issue! WE NEED ELECTRIC CARS RIGHT NOW!!! HURRY!!!
AustonT wrote:
I respect you and I respect your opinion, but mine is that the government is not a capital investor and should not engage in investment practices. Jus because they do, doesn't mean they should. If you and I belonged to a home owners association and I collected dues from you (and the other neighbors) to maintain the comment park and garden. And instead I let the park fall into disrepair and loaned the money to a start up company with an empty warehouse to develop artificial turf for the park, wouldn't you be a little angry at me?
That would be an explicit misappropriation of funds, which is very different from using funds rendered to the state for its discretionary use as discretionary funds.
The state is not entitled to discretionary funds, it may only collect taxes for specific purposes. I do welcome enlightenment if I'm wrong but I'm fairly certain that Art 1 Sec 8 doesn't mention discretionary funds.
DickBandit wrote:
Kilkrazy wrote:Should the US government have invested in;
The Hoover Dam general welfare
The Manhattan Project common defense
The Lake Portchartrain I had to look this one up, not from the Louisiana or the South for that matter. General welfare.
NASA back in the day, common defense. Nowadays it's questionable weather maintaining a space program is defense spending. I know it's not part of the DoD budget but the argument for space travel was military first and exploration second. Like backwards star trek.
...?
PFFFT! What? Why would the government invest in THAT stuff?! Those are needless commodities compared to this issue! WE NEED ELECTRIC CARS RIGHT NOW!!! HURRY!!!
All of the projects mentioned were wholly funded by the government and directly owned, manned, and maintained by it. I'm not sure the status of the ownership of Hoover now though. I was pretty sure I mentioned Hoover as a worth project further up.
AustonT wrote:
The state is not entitled to discretionary funds, it may only collect taxes for specific purposes. I do welcome enlightenment if I'm wrong but I'm fairly certain that Art 1 Sec 8 doesn't mention discretionary funds.
The ability to exercise discretion in the use of revenue is implied by any specific power to do a thing that entails the use pf said revenue. In essence, when vested with the authority, or obligation, to exercise a given power, if the use of funding is necessary for that exercise, then Congress has the power to use said funding at its discretion; rendering the funding discretionary. Since the taxing and spending clause includes the phrase "general welfare", Congress has a large amount of leeway in terms of what it may spend money on; meaning that calling the Federal budget discretionary as a whole is not entirely without merit.
AustonT wrote:
All of the projects mentioned were wholly funded by the government and directly owned, manned, and maintained by it. I'm not sure the status of the ownership of Hoover now though. I was pretty sure I mentioned Hoover as a worth project further up.
I don't see why investing money in a third party is inferior to the direct undertaking of a project. In both instances the state stands to lose money.
deal with a 
