And whether Tesla invented all of its own technology is irrelevant; nobody else has put it together the way they have.

The US could have funded/seeded several “upstart” car companies for the $80 billion that’s been wasted on GM and C.

This retooling subsidy is a classic externality internalizing subsidy, assuming that global warming is an externality. Private industry, which would otherwise not have enough incentive to overcome the cost of developing alternative energy technology, is having that cost reduced with no interest “loans”.

A $50,000 dollar car is the first step in making the technology cheap enough for all cars, and I don’t see Detroit coming up with any electric cars for the masses. The Korean battery using Volt is targeted in the $40s, and all Chrysler can come up with is a rebodied Lotus like the original Tesla.

I don’t agree with the retooling subsidy, I say raise the gas tax, actually use the money for roads, and get rid of toll roads and revenue raising speed and red light cameras. Along with providing legitimate, instead of “got ya” revenue, a gas tax would also provide alternative energy incentives without the government paying out subsidies.

But the retooling subsidy is much less ridiculous than the > $100 billion that is being spent to simply soften the certain failure of Chrysler and possible failure of GM. And Tesla is as deserving of it as any Detroit automaker.

Tesla has virtually no technology of their own. They bought AC Propulsion battery tech and had Lotus do most of the engineering for the Roadster. They have developed software and revised the battery pack, but a volume automotive manufacturer, this does not make. It seems to me that the development of the Model S will be contracted out to Mercedes, and thus Mercedes will get the bulk of this money. Do we really need to be paying Mercedes to build green cars for rich people while simultaneously padding Elon Musk’s ego and bank account?

Even worse for Detroit, Nissan, whose logo is the rising sun, got $1.6 billion.

GM and Chrysler, because of their respective bankruptcy and recent emergence from bankruptcy, do not have the financial viability to receive the loans.

However, not all is bright for Tesla. Dahmer Daimler recently took a 10% stake.