Many libertarians seem to love to hate Elon Musk these days. His crime is to live off the public purse. His companies would be bankrupt without green subsidies and cheap government loans and contracts. He seeks out favorable terms from governments and angles to capture subsidies and cheap loans with no reservation and with vast success at doing so. This situation, along with certain financing practices and relationships among his companies, has led to it becoming fashionable to disdain Musk as a public figure and to characterize him with sweeping put-downs.
By: Konrad Graf
This article first appeared at Mises.org
I have a more complex assessment of Musk as a figure. I enjoyed listening to his 2015 biography by Ashlee Vance. I tend to look for the positive things in people. One positive quality here is the ability to re-envision products from the ground up in a completely different way. The Tesla is not just the evolution of the car, but a completely new way to think about what a car is. A car is a thing with an engine and a drive train, right? True for a century, but not any more. Musk has done in the fields of cars and rockets, what Steve Jobs did for computers and phones, completely re-envisioned what they could be, how they could be built, and how they could be used.
A second quality is execution under very challenging circumstances. Anyone can have big ideas, but only the few are able to successfully execute on them in the “really existing” world. SpaceX’s rocket designs and rocket reuse and the Tesla Model S were almost universally deemed impossible — until the job was actually done. Rocket reuse was just a science-fiction fantasy. SpaceX did it. An electric car “that didn’t suck” was also an impossibility — until Tesla built the Model S, which has been assessed by multiple car review magazines as basically the best car in the world, bar none, on both safety and performance. It is not only as good asconventional vehicles, it leaves them all behind, not just on green measures, but on car measures as such.
So from a simple first look, at this level, one could argue that however these things were achieved, they were at least potentially positive achievements (though this assessment will be qualified further below). In addition, Musk cannot be accused of relying on subsidies to the exclusion of also having skin in the game. He has repeatedly staked recklessly large portions of his personal fortune on bridging impossible-looking financial stretches for his enterprises.
I fully support the view that actively advocating for the expenditure of public funds is immoral. The only moral way to advocate for the use of public funds is to argue in favor of their return to the people to whom they rightfully belong, namely those whose wealth was forcibly extracted, mainly the original taxpayers.
On the other hand, if taxpayers in their role as victims of the state accept state handouts that are already flowing — provided they do not actively advocate for the continuation of such handouts — it is perfectly moral for them to take receipt of such funds as a form of limited restitution for other damages they suffer at the state’s hands on a constant basis. This includes not only direct taxation but all the myriad seen and unseen harms from the arbitrary “regulation” of many aspects of life and work, all unjust restrictions on the liberties of mutually consensual production, trade, and association.
In this context, Musk’s actions in relation to subsidies and government contracts must be viewed as mixed. Green vehicle subsidies, for example, already existed before Tesla. Building a car that would qualify for them does not — in itself — constitute advocating for the subsidy program. Seeing only crappy electric cars receiving subsidies, an entrepreneur could quite reasonably set out to build a better competing car that would also receive these same pre-existing subsidies instead of the crappy golf-cart cars.
Of course, Musk certainly does promote such programs. However, only at the point where he benefits from programs the adoption or maintenance of which was actually influenced by his advocacy — does a moral case against his benefiting from them become unmistakable. The minimal conceptual dividing line is that simply benefiting from subsidies is not objectionable per se, advocating for them is objectionable, and advocating for them and then also receiving benefits as a result of such advocacy is the worst case.
In this view, I suspect that his guilt is far more mixed than a simplistic portrayal of “his company benefits from subsidies, and could not exist without them.” His enterprises have surely benefited in all three types of ways, ranging from acceptable to less acceptable to not acceptable.
Context is also important. No car company would exist in its current form and at its current scale without unimaginably massive subsidies continuously provided to all automobiles over many decades, distorting not only the entire structure of transportation, but also the very formation and shapes of cities and communities. This vast structural distortion of the entire transportation industry, which systematically twists spatial relationships between residences and businesses, takes a simple form: the production and maintenance of roads provided free of charge to drivers, financed by taxation. A simple heuristic to consider while commuting is that every time one has to pay by waiting, such as in a long line or in thick traffic, the state is squarely to blame.
In prosecuting Musk for his moral position in relation to the receipt of government support, another “extenuating circumstance” of wider context must be considered. What his companies have done with the money and other advantages he receives from state entities is far more valuable a contribution than almost anything else that follows from other uses of such money and advantages.
Most of the state’s money goes to “the production of bads,” to use Hoppe’s terminology, as opposed to the free market’s production of goods. We do not want the production of bads to be carried out more efficiently. Indeed, we do not want bads to be produced at all—less of them is better.
Not only is the money the state extracts from the productive population wasted once when initially extracted, the ways that this money is subsequently used are generally quite wasteful a second time, compounding the damage to society. In the US case, most government money goes to the following types of uses: financing global military interventionism and promoting armed conflict and death all around the world, financing vast bureaucracies that meddle in all aspects of society, undermining healthy natural incentives, promoting fragility, harming employment, limiting innovation, and spreading social and cultural degeneration, high time preference, frailty, and dependency across the population.
Against this backdrop, Tesla has extracted something from the stream of public money and used it as part of a project which has produced arguably the best car the world has ever seen.
Why libertarians should want to focus vitriol on this, one of the bestexisting uses of the state’s handouts is somewhat mysterious. Why not spend the same time complaining about the 99+% of uses of state subsidies and privileges that lead to worse outcomes than this?
It is far easier to criticize than to achieve. A sad and strong cultural tendency is to find flaws in hero figures and emphasize those flaws over their positive characteristics. But what does such cultural cynicism bring?
My approach is the opposite in two ways: focusing on the positive and focusing on qualities. I look for admirable aspects of a person. I look for actions and qualities to which positive adjectives such as heroic can be applied, rather than attempting to apply a blanket noun such as hero (or not a hero) to necessarily multifaceted persons. I always look for what I can admire and/or borrow, in both people and thought systems. If I were to look for the worst in others and focus on that, it would be simple, but would accomplish nothing, since I would always find and focus on negative aspects of persons, aspects which I did not want to emulate. If instead I look for the best in each person, I always have something available to learn from and emulate. Likewise, if I look for the best in each thought system, and dismiss the rest, I always have one new puzzle piece to add to my own global knowledge synthesis.
I agree that Musk is guilty of actively seeking to gain from state handouts. However, this is partly mitigated in that at least some of these handouts were already being handed out, and could therefore be legitimately captured as partial restitution for other damages that the state continuously inflicts. It is also partly mitigated in that the uses to which these funds are being put are arguably positive developments relative to the worse outcomes that result from almost all other uses of money derived from state coffers.
It should be made clear that extenuating circumstances do not make it morally acceptable to advocate for the receipt of subsidies from the state. Nevertheless, guilt on this count (albeit probably somewhat more mitigated guilt than some critics have implied) should not be interpreted such as to invalidate the man’s positive attributes and accomplishments.
As I read Musk’s biography a couple years back, I came to view him more as the type of mixed Randian semi-hero who blends a certain heroic genius in some areas with serious flaws elsewhere. His genius is a vision- and engineering-driven entrepreneurship that has proven able to repeatedly achieve “the impossible” in practice in productive sectors of technological achievement (mainly transportation). One of his flaws is being all too gleeful in his pursuit of capturing ill-gotten gains from the state as one of the means he uses in this process.
The purest of the Randian superheroes all went on vacation from their professions in an exclusive mountain resort. Engaging with the real world to achieve great things today is often messy and complex. This is not an excuse to soften one’s moral principles in action. However, Musk’s own moral worldview contains no compunctions about attempting to influence state and regulatory actions, including in favor of his own enterprises. He can therefore be accused of being morally mistaken on this topic. Yet this amounts to the relatively simple claim that he is not a libertarian, which I do not think is in dispute.
I do not buy into the bases of some of Musk’s bigger-picture motivations, above all global warming death hype. In addition, I argue in “The Unbearable Lightness of Martian Gravity” that his Mars colonization vision could very well turn out to be a dead-end, not on technical grounds, but on biological ones. That said, I do not criticize in order to take down a hero figure. I acknowledge and appreciate the heroic aspects of the figure, while also acknowledging the flaws and pointing out what I believe to be the errors.
Ron Paul said that if we are reducing the size of the state, the place to start is not with old ladies’ state pension checks, but with outlandish militarism and a state-orchestrated monetary system that enables virtually unlimited debt financing for the state and its cronies. Probably one of the last things to cut out in dismantling the interventionist state is old ladies’ pension checks, and this after other policies that have undermined responsible private retirement saving, real insurance, and natural multi-generational care practices have been long since eliminated.
Likewise, libertarians complaining about uses to which government money is being put might consider that Tesla subsidies could well be among the best uses to which such money is currently being put. They might therefore redirect their attention and vitriol to the widespread mass production of unmistakable “bads” financed by the state, those that are far worse than some of the more impressive American engineering innovations in recent memory.
Konrad S. Graf has published articles on bitcoin monetary theory and action-based legal philosophy and has presented on these topics at conferences in Europe and Australia. In 2015, he published Are Bitcoins Ownable? Property Rights, IP Wrongs, and Legal Theory Implications, a monograph on bitcoin and property rights theory.
This article first appeared at Mises.org