It must be hard being Elon Musk. Yep, everyone’s favourite Space Karen is crying into his Giga bier and fiddling with his flame thrower in angst. He’s aimed his ire at a proposal before the US Senate to tax Musk and his wealthiest friends.
Specifically, these billionaires would fall subject to the 23.8% capital gains tax on the increased value of unsold assets like stocks and bonds.
Elon has plenty of money
Let’s be clear: the man is hardly buying no-name brand baby food for X Æ A-12. His net worth rose by a tidy $36.2 billion alone on Monday in response to a surge in Tesla stock.
He reportedly earns $610.8 million per week — that’s $152.7 million per day, $6.3 million per hour, or $106,000 per minute.
But let’s not forget that as we pay our taxes each year (and he pays none), we’ve effectively been subsiding not only Elon Musk’s lifestyle, but also his vanity projects. While Elon pays capital gains tax and property taxes, he lives in Texas, which doesn’t have a personal income tax.
How do you feel about subsidizing Musk’s vanity projects with your tax?
A large chunk of Elon Musk companies get government funding. In 2015, research by the LA Times into Tesla, SolarCity, and SpaceX found they had received an estimated $4.9 billion in government support in grants, loans, and contracts.
Even dodgier, in 2020, Tesla was delivered more than $400 million from selling environmental credits to automakers that fail to sell enough zero-emissions cars to meet governmental mandates. These credits were the only reason Tesla turned a profit in its early years.
And let’s not forget the amount of cash awarded to Musk companies to send the rich and privileged to Mars. Look, it’s not all bad, for example, SpaceX won $900 million from the US government to extend broadband access to rural America. This is a good investment into satellites, especially if it translates to connectivity to remote areas in South America, Australia, and Africa.
But, most of the cash thrown at Elon Musk’s various enterprises is at the expense of investing in sustainable public transport.
The problem is public transport, not flying people to space
An appalling historical lack of financial and infrastructural investment in US public transport means heavy pollution forces people into their cars — over 70% of Americans drive to work.
It creates road congestion that means some people spend over 40 hours a year in traffic jams. In 2020, LA-area commuters wasted 46 hours on the road, and New York drivers spent around 56 hours.
Furthermore, poor, Black and Hispanic people (as well as the aged and those with disabilities) are the biggest users of public transport. Bad planning in cross-town transport means a relatively short commute can take hours and several transport changes.
But there’s no one championing public transport. There are no sexy launch parties or dedicated party swag, just a sector so vulnerable that it needed massive bail-outs after people stopped riding due to the COVID-19 shutdowns.
While I’m genuinely passionate about transport innovation like autonomous vehicle development, I’d like to see a different allocation of funds. What Elon could potentially pay in tax could fund a heck of a lot.
Elon, how about voluntarily paying some tax to fund public transport?
Let’s look at that single earning on Monday of $36.2 billion and compare it to the cost of public transport. Maths is hard and boring, but let’s make it easy.
We’re going to be talking about millions vs the billions earned by Elon in a single day, so you just need to remember that there’s 1000 million in a billion.
How much tax is needed to fund public transport?
Extending the Los Angeles Metro by 14km (9 miles) costs over $9 billion, so Elon could have made that a 40km extension with his windfall on Monday.
He could even build a more modest railway. Railroad economist Jim Blaze did the math of building a railway line for FreightWaves so we don’t have to. He explained:
Ignoring the land cost, the basic rails + ties + ballast + sub-compaction and grading might as a capital budget expense come to between $3.5 million and $4.5 million for each route mile when built as a single-track mainline.
If you build a parallel second main track, then consider adding another $1 million to $1.5 million per mile to the budget plan.
Are you building this track in an urban area? Prudently add another $2 to $4 million a mile to the capital construction budget. Add more if the terrain requires tunnels and bridges. Add even more if utilities or structures need to be relocated.
He notes that upgrading an older line comes in even lower at a range of $150,000 per mile.
Buses are even cheaper. Texas A&M University predicts route costs of approximately $90,000 to $180,000 per year per new bus. A new bus costs about $500,000 to purchase (probably closer to $800k for electric.)
This is an area begging for innovation. The school bus driver shortage is so severe that the National Guard are now driving school buses.
Let’s not forget the Hyperloop
While I’m not entirely opposed to Hyperloop tech, let’s call a spade a spade, or in this case, a tunnel a tunnel. Elon’s Boring Company spent $52 million on the 1.5 mile Las Vegas’ Loop that’s just a bunch of cars in a tunnel and not even autonomous ones at that. If you’re looking for the Hyperloop, you might be waiting a while.
Ok, Elon is clearly a very important and busy man. I can’t see him stepping up to drive a few kiddies to school or placing a tunnel somewhere really useful that removes the need for massive chunks of bumper-to-bumper driving.
But he could be a bit fucking gracious about paying taxes like the rest of us — and by extension, investing in public transport.
Get the Shift newsletter
Get the most important mobility news in your inbox each week.Follow @shift_tnw