- - Wednesday, March 12, 2014

Tesla Motors embodies crony government gone wild. Politicians first infatuated with electric toys in their childhood have dug deeply into the public treasury to prop up companies that build battery-powered cars with a six-figure price tag and a two-digit driving range.

These impractical cars appeal not to families on a budget, but to wealthy liberals anxious to salve guilt over their success with an accessory to show the world how much they care about the planet.

Legislators authorize rebates to make sure the likes of Leonardo DiCaprio never have to pay the full price for their fashion accessory.

But cronyism begets cronyism. Automobile dealers are conniving with the New Jersey state government to put Tesla out of commission.


Electric cars are nothing new — they have been around since the late 1800s — but the proposition of selling cars directly to consumers, the way Tesla does, is new.

An insatiable appetite for federal subsidies notwithstanding, Tesla founder Elon Musk is a legitimate entrepreneur. He made millions creating the successful electronic payment system PayPal.

When he turned his attention to automobiles, he saw that automobile dealerships are often the villains of the car-buying adventure, peddling unnecessary “rust proofing” and “fabric protection” treatments to separate trusting and unsuspecting customers from their money.

That’s why automobile salesmen rank only slightly higher than members of Congress, journalists and terrorists in the affections of the public.

Tesla eliminates the middlemen by introducing cars in showrooms and selling directly to the customers over the Internet. The concept is a mortal threat to the dealership model, and the dealers know it.

Their lobbyists are busily making the rounds of state capitals to persuade legislators to prohibit this competition.

The National Automobile Dealers Association represents 32,500 franchises, with the political clout to match. Even with state and federal plug-in subsidies, and a substantial lobbying team of its own, an upstart like Tesla can’t come close to matching the dealers’ influence.

The New Jersey Motor Vehicle Commission surprised Tesla on Monday with a ruling undermining its business model. The regulation decrees that only franchised dealerships can sell new cars in the state. No dealerships, no car sales.

Tesla must close its showrooms in Short Hills and in Paramus. The dealers pulled off a hardball maneuver that would please Tony Soprano, New Jersey’s favorite mobster son.

Mr. Musk accused Gov. Chris Christie of “subverting” the democratic process. “The Administration and the [New Jersey Motor Vehicle Commission],” he says, “are thwarting the Legislature and going beyond [its] authority to implement the state’s laws at the behest of a special-interest group looking to protect its monopoly at the expense of New Jersey consumers. This is an affront to the very concept of a free market.”

So are subsidies, but he’s right about the crony arrangement with the dealerships.

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