Washington Times Urges Government to Halt Subsidies on Electric Vehicles Only Hollywood Types Can Afford

4 years ago by Eric Loveday 11

Leonardo DiCaprio Poses With His Fisker Karma

Leonardo DiCaprio Poses With His Fisker Karma

It’s long been argued that governments around the world can’t continue to afford to subsidize the purchases of plug-in vehicles.  Sure, Uncle Sam can afford a few billion dollars in subsidies over the course of several years, but at some point, the outlay of cash will dry up.  And that seems to sort of be the case right now.

Justin Bieber Pulled Over in His Chromed Out Fisker Karma

Justin Bieber Pulled Over in His Chromed Out Fisker Karma

Interestingly though, some media outlets are urging governments to immediately halt subsidies on plug-in vehicles.  This, of course, wouldn’t be wise, as governments around the world have vested a significant amount of money into plug-in vehicles and need to stick it out for a few years before pulling the plug.  If halted right now, money spent will effectively be wasted, as results are not ever immediate in emerging technologies.

Regardless, here’s the gist of this immediate-halt argument (edited for brevity, but link to full article is below) presented by the Washington Times:

“Such princely subsidies haven’t sparked a lot of interest among consumers. The Congressional Budget Office noted in a report last year that electric cars are so much more expensive to produce that “the credits would have to be two or three times as large as they are now to make those vehicles cost-competitive” with reliable, gasoline-powered sedans. The auditors calculated a plug-in hybrid costs $19,000 more to produce, but over the car’s 150,000-mile life span it would only save $7,000 in reduced fuel consumption. Only people who can’t do math buy them…”

“…Wealthy Hollywood celebrities, of course, are not limited by financial considerations. They’re always first in line to pick up the flagship electric cars, such as the $102,000 Fisker Karma and the equally pricey Tesla Roadster. Matt Damon, Ashton Kutcher and Leonardo DiCaprio can’t buy enough of the subsidized six-figure rides….”

“…So all of this crony capitalism accomplishes nothing beyond propping up — for a time — some fly-by-night companies. If the White House can’t afford to run White House tours, America can’t afford to subsidize Hollywood’s cars, either…”

Of course there are flaws throughout the argument, but the most obvious oversight is that, as with all cutting-edge technology, prices drop over time.  So, celebrities (and other wealthy individuals) may today be the only ones who can afford some of the most radical electric vehicles out there, but there already exists plug-in vehicles that the Average Joe can easily afford and, over time, even some radical EVs will be within a commoner’s budget.

via Washington Times

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11 responses to "Washington Times Urges Government to Halt Subsidies on Electric Vehicles Only Hollywood Types Can Afford"

  1. Bill Howland says:

    Im surprized that Hollywood Celebs would purchase a Kharma… I test drove it twice, and the ones I drove were not a finished design… Maybe its all about “Looking Right” which I could care less about it.

    Washington Times has some good articles at times but they are worrying about trifles here.

    If they want the Gov”t to save money how about disbanding Michael Chertoff’s TSA at the airports and stop the ChemTrails program which is killing the forests, oceans and lowering worldwide oxygen content.

    1. Bonaire says:

      Absolutely. I believe if you look into it, each and every TSA agent is paid about $50-60K per year. TSA is a resounding success. At using taxpayer money. It’s part of the fear-porn that all began back in 2001.

  2. Dave R says:

    You know, they’re right. And since the flat 15% capital gains tax disproportionately benefits the 1%, we should ditch it and tax capital gains at the same rate as regular income, too. w00t!

  3. kdawg says:

    Sure, right after they get rid of claiming property taxes and mortgage interest on 1-million dollar mansions.

    1. Bonaire says:

      I would gladly skip my mortgage interest deduction as a benefit to the debt. My mansion is well under $300K 🙂 It’s not a lot of benefit to me but multiplied by say 80Million households, this deduction adds up fast. Canada doesn’t have the deduction and they’re not in a big mess and some of their housing markets are hot (ie. Vancouver, etc.)

  4. Mark H says:

    I like these types of articles. It means a nerve is being struck somewhere. Thanks for posting that Eric.

  5. evnow says:

    You need to know only one thing about this article – it is in Washington Times.

  6. robster says:

    mmh, as much as I’m in favour of the subsidies in order to kickstart the BEV/Plugin Hybrids, there is some reasoning in this article.

    You want the (slightly above) average Joe to be able to buy an electric car like the Leaf, the Volt and maybe the I3 in a while. Because, in the end, that’s the place market where the volume is which benefits the entire country (dependency on foreign oil, polution etc, noise in cities etc.).

    However people who can spend 100k on a car, can spend 107,5k on a car, I’d rather raise the subsidies for >50k electric cars by lowering them for the more pricy cars.

    1. Cavaron says:

      Can’t agree more with that, even sub 40k would be enough.

    2. Bonaire says:

      Well, simply IRS can cap the deduction based on income levels. It’s a few lines of code in the IRS books and computer systems.

  7. Open-Mind says:

    This debate about tax policies is based on a false premise …

    The rocketing federal debt is not due to any changes in US tax policy. According to the IRS, the highest tax revenues ever recorded were in 2007 under President Bush.

    The rocketing federal debt is mostly due to massive unprecedented increases in government spending.