As Covid-19 descended on California in March and April of this year, economies began to shut down and the debate raged over what businesses were deemed “essential.” Elon Musk, the founder of Tesla, and Alameda County authorities went back and forth over whether the Tesla plant in Fremont should be allowed to reopen.
This dialogue was punctuated by a pithy tweet from Assemblywoman Lorena Gonzalez, who describes herself as a progressive Democrat, “F*ck Elon Musk.”
At that time, we had no idea how much that tweet, and attitude, would cost us.
Nine months later, Elon Musk is gone. He is selling all his personal real estate in the state. He is now a resident of the state of Texas. He has moved his philanthropic foundation to Texas, too.
Consider the unfathomable irony of progressive Democrats forcing Elon Musk to give up on California. Musk came to this state as an immigrant and proceeded to do more to reduce greenhouse gas emissions through Tesla Inc. and its subsidiary, solar panel manufacturer SolarCity Corp., than all the “progressive” politicians in the state combined. Musk didn’t talk about it. He simply brought products to market that benefited the consumer, the environment and his shareholders. He should have been the poster boy for the green agenda, but instead they turned on him because he committed the ultimate sins: He made money and he questioned their authority.
This year, Musk is likely paying billions in state tax. Next year, he will be a resident of another state.
The damage goes much deeper than the tax revenue of one person. Musk didn’t just leave the state. He turned on the state. It is now his mission to get other innovators to leave as well. According to Texas Gov. Greg Abbott, he is on the phone with Musk once a week, strategizing about how to get other California companies to relocate to Texas. In the last few weeks, Hewlett Packard Enterprise Co. and Oracle Corp. have both announced they are moving their headquarters to Texas, with other potential moves in the pipeline.
In a nutshell, California state income tax is the highest in the nation, California’s ranking for “business friendliness” is the lowest, and we have elected representatives who would lob crass, vulgar F-bombs at the people who are paying the freight.
The worst thing about the Gonzalez tweet is that no one called her on it. No one in state government had the guts to repudiate her words and show a modicum of respect for a man many call “the da Vinci of our age.” Don’t think other business owners don’t notice. Don’t think they don’t know that if Musk and Oracle founder Larry Ellison are leaving the state, “they’re going to try and get more out of me.” Don’t think it isn’t indicative of how many California elected officials view business.
Elon Musk may be the da Vinci of our age, but the stock price of Tesla is now a bubble up there with the Dutch tulip bubble in 1737. Tesla’s market capitalisation is now about the same as the market capitalisation of the nine largest car companies in the world combined, despite Tesla’s car-making business being unprofitable and relatively small scale.