‘China rocks,’ U.S. full of ‘entitlement’

Tesla Inc CEO Elon Musk speaks at an opening ceremony for Tesla China-made Model Y program in Shanghai, China January 7, 2020.

Aly Song | Reuters

Tesla and SpaceX CEO Elon Musk lamented the “entitled” and “complacent” character of people in the United States, and lauded the “smart” and “hard working people” of China, in the first installment of a three-part interview with Automotive News’ “Daily Drive” podcast published Friday. 

Specifically, Musk criticized New York and California — states that have supported his businesses, especially Tesla, with considerable tax breaks, regulatory credits and other government help.

Automotive News publisher Jason Stein, who conducted the interview, asked Musk, “How about China as an EV strategy leader in the world?”

Musk replied: “China rocks in my opinion. The energy in China is great. People there – there’s like a lot of smart, hard working people. And they’re really — they’re not entitled, they’re not complacent, whereas I see in the United States increasingly much more complacency and entitlement especially in places like the Bay Area, and L.A. and New York.”

Last year, Chinese government officials helped Tesla secure loans worth around $1.6 billion to construct and begin manufacturing vehicles at the company’s relatively new Shanghai factory. This year, the Shanghai government helped Tesla get back to normal operations quickly, at its new plant, after the region was struck by a Covid-19 outbreak and issued widespread quarantines that temporarily suspended manufacturing there.

Musk pointed out, Telsa has not received as much assistance from the government in China as domestic companies there. “They have been supportive. But it would be weird if they were more supportive to a non-Chinese company. They’re not,” he said.

The enthusiasm the mercurial Musk expressed for China contrasted with his expressed disdain for communism. In a tweet on Monday this week, Musk mocked social welfare programs in general, and Karl Marx’s “Das Kapital.”

During the Automotive News podcast, Musk also compared the U.S., California and New York to sports teams about to lose their winning status.

He said:

“When you’ve been winning for too long you sort of take things for granted. The United States, and especially like California and New York, you’ve been winning for too long. When you’ve been winning too long you take things for granted. So, just like some pro sports team they win a championship you know a bunch of times in a row, they get complacent and they start losing.”

Tesla and the states

Among U.S. automakers, “Tesla has had the least government support of any car company,” Musk said.

He boasted about Tesla’s repayment of a loan to the U.S. Department of Energy ahead of schedule.

In June 2009, the Obama-era Department of Energy awarded Tesla a $465 million loan to set up a vehicle assembly plant in Fremont, California, and to begin production of its flagship all-electric sedan, the Model S. Tesla repaid it with interest by May 2013, nine years ahead of schedule. 

The DOE loan was small compared with the tens of billions in TARP loans that went to bail out General Motors and Chrysler during the financial crisis that began in 2008.

However, Tesla has benefited from other forms of government assistance in the U.S. According to analysis by the Los Angeles Times, Tesla’s government assistance in the U.S. has surpassed $4.9 billion.

Tesla’s government support in California has included more than $220 million in sales and use tax exclusions from the California Alternative Energy and Advanced Transportation Financing Authority, as well as zero emission vehicle and solar renewable energy credits granted by the state. The sale of these regulatory credits were a major factor in Tesla’s profitability in the past four quarters. 

As CNBC and others previously reported, New York state spent $959 million on a solar-panel factory in Buffalo, now operated by Tesla, in a drive to bring more than 1,000 high-paying tech and manufacturing jobs to the state.

Tesla hasn’t fulfilled its employment obligations in New York so far. A financial filing out this week revealed that Tesla has obtained a full-year extension from the state in order to meet the head count requirement. If it does not, Musk’s electric car and renewable energy venture will have to pay back $41 million to the Empire State.

Tesla stock and sales

On the podcast, Musk also celebrated the fact that Tesla is now seen as a “legitimate” American and multinational automaker. While it used to be an upstart and underdog, Automotive News asked him what was going on with the soaring price of Tesla shares, which are up more than 240% this year, and whether Musk felt a need to manage investors’ expectations.

The CEO demurred:

“It’s not worth trying to massage the stock market or manage investor expectations. It’s just. You know? At the end of the day, if you make great cars and the company’s healthy and making great products investors will be happy…If you make lousy products your customers will be unhappy and then your investors will be unhappy.”

Elon Musk, chairman and chief executive officer of Tesla Motors, speaks in front of a Tesla Model S electric car on day two of the 2010 North American International Auto Show in Detroit, Michigan.

Bloomberg | Bloomberg | Getty Images

He also gave this advice to other entrepreneurs: 

“My advice, you know, to corporate America or companies worldwide is spend less time on marketing presentations and more time on your product. Honestly that should be the number one thing taught in business schools. Put down that spreadsheet and that PowerPoint presentation and go and make your product better.”

He also predicted that online car sales, and delivering cars direct to consumers, rather than vehicle sales through stores or traditional dealerships, would become even more of a standard, after Covid-19. 

Tesla saw “strong orders through the whole pandemic,” Musk said. Tesla deliveries that declined about 5% for the second quarter of 2020. Due to Covid-19 impacts, most other automakers saw sales plunge more than 30% during the same period. The CEO concluded, “Having a traditional dealer situations I think seems increasingly unnecessary and I think probably the pandemic just reinforced that.”

Tesla shares closed down 3.8% on Friday, but have been on a spectacular run this year despite the global coronavirus pandemic and the onset of a recession. 

White House denies report that national coronavirus testing plan was scrapped to hurt blue states

Admiral Brett Giroir, U.S. Assistant Secretary For Health, speaks during a House Select Subcommittee on the Coronavirus Crisis hearing in Washington, D.C., July 31, 2020.

Erin Scott | Pool | Reuters

The White House on Friday denied a report claiming the Trump administration scrapped plans for a national coronavirus testing strategy to make Democratic governors in some of the hardest-hit states look bad as “entirely false.” 

According to an article published Thursday in Vanity Fair, a team led by the president’s son-in-law, Jared Kushner, created a national testing plan early in the nation’s response to the pandemic that called for the federal government to coordinate the distribution of test kits to heavily impacted areas, among other recommendations. The publication said it had obtained a copy of the plan. 

“The article consistently misstates and misrepresents,” White House press secretary Kayleigh McEnany said in a statement. “The article is completely incorrect in its assertion that any testing was stopped for political or other reasons.”

The report said Kushner’s team worked separately from the Department of Health and Human Services team led by Adm. Brett Giroir, an assistant secretary for health at HHS, which was tasked in mid-March with coordinating the nation’s testing efforts among the Centers for Disease Control and Prevention and the Food and Drug Administration, as well as state and local public health authorities and private or public clinical laboratories. 

However, Kushner’s plan was reportedly scrapped by the Trump administration because the coronavirus was hitting Democrat-led states the hardest, and a national strategy “would not make sense politically,” Vanity Fair reported, citing a public health expert who spoke with a member on Kushner’s team familiar with the matter. 

“I have never heard something so preposterous as ‘we’re not going to do a national plan because it’s affecting Democratic states,'” Giroir said in an interview on Fox News. Giroir is leading the U.S. testing effort. “I would like to put that to rest because it’s really ridiculous and it foments mistrust in the public health system.” 

Giroir said on Fox News that he saw Kushner’s plan and “implemented parts” of it. 

“We were all working together, there was no separation or no closet Cabinet or no super-secret kind of plans. We all worked together,” Giroir said. 

Earlier this year, as the coronavirus spread from Asia and Europe to the U.S., states with Democrat governors, such as Washington, New York and California, were among the first to report severe coronavirus outbreaks. New York eventually became the country’s epicenter, reporting nearly 800 deaths every day at the height of its outbreak in April. 

At the time, the federal government struggled to advance the nation’s testing capacity and delegated the task to the states. New York scrambled to buy coronavirus test kits, eventually ramping up its own equipment manufacturing and lab testing capacity in the state. 

New York Gov. Andrew Cuomo has been a frequent critic of the Trump administration’s response to the coronavirus pandemic, calling it the “virus of American division and federal incompetence.” 

Court overturns Boston Marathon bomber’s death sentence

Dzhokhar Tsarnaev

U.S. Attorney’s Office in Boston | Reuters

A federal appeals court on Friday overturned the death sentence of Dzhokhar Tsarnaev, the man convicted in the 2013 Boston Marathon bombing.

The three-judge panel of the 1st U.S. Circuit Court of Appeals in Boston issued the decision more than six months after arguments were heard in the case.

The April 15, 2013, attack killed three people and injured more than 260 others.

Tsarnaev’s lawyers had argued that intense media coverage had made it impossible to have a fair trial in Boston. They also pointed to social media posts from two jurors suggesting they harbored strong opinions even before the 2015 trial started.

The appeals judges, in a hearing on the case in early December, devoted a significant number of questions to the juror bias argument.

They asked why the two jurors had not been dismissed, or at least why the trial judge had not asked them follow-up questions after the posts came to light on the eve of the trial.

The judges noted that the Boston court has a longstanding rule obligating such an inquiry.

Tsarnaev’s lawyers say one of the jurors, who would go one to become the jury’s foreperson, or chief spokesperson, published two dozen tweets in the wake of the bombings. One post after Tsarnaev’s capture called him a “piece of garbage.”

Tsarnaev was convicted on 30 charges, including conspiracy and use of a weapon of mass destruction. He’s been serving his sentence in a high-security supermax prison in Colorado.

His brother, Tamerlan Tsarnaev, was killed in a gun battle with police days after the two brothers detonated two pressure cooker bombs near the marathon finish line.

Early coronavirus drug trials tested vaccines mostly on White people; next phase aims for diversity

Early coronavirus drug trials tested vaccines mostly on White people; next phase aims for diversity