NoRegrets78
OG
From that last link:
MYTH: Each Volt Cost Taxpayers More Than $250,000 In Subsidies
In a CBS news brief, Ashley Morrison stated: "According to a new report, every car sold so far has cost taxpayers as much as two hundred and fifty thousand dollars." [CBS, CBS Morning News, 12/22/11, via Nexis]
Fox News promoted the figure on Fox & Friends, Special Report, and The Five (twice). Fox Business covered the figure in at least 9 segments. [Media Matters, 12/22/11] [Nexis search, 1/20/12]
Rush Limbaugh and numerous conservative blogs repeated the figure. [RushLimbaugh.com, 1/11/12] [HumanEvents.com, 1/7/12] [Washington Examiner, 1/23/12] [National Review Online, 12/21/11] [MichelleMalkin.com, 12/21/11] [Hot Air, 12/21/11]
FACT: Subsidy Estimate Was Based On Fuzzy Math
Estimate Includes Subsidies For Supplier Companies And Subsidies That Haven't Actually Been Distributed. The source of the claim that each Volt costs taxpayers $250,000 in subsidies is James Hohman of the Mackinac Center for Public Policy, a conservative think tank that has received money from fossil fuel interests. The estimate, which Hohman conceded was "simple math," included state and federal subsidies "via tax credits and direct funding for not only General Motors, but other companies supplying parts for the vehicle." It also included subsidies that the companies haven't yet received. Hohman divided that total by 6,000 - the number of Volts sold at the time. [Media Matters, 12/22/11]
Finance Writer: "Fundamental Flaw" In The Estimate "Discredits The Entire Report." Writing for TheStreet.com, Anton Wahlman - who said he is "totally opposed to government subsidies" -- stated that "there is a fundamental flaw behind the math in this 'report' that discredits the entire report straight down to zero, in my view." From his post:
Here is the point: Why divide whatever amount -- $1.5 billion or otherwise -- by the number of Chevrolet Volts sold to date? If he had done this study one year from now, when we could be looking at 60,000 Volts made, as GM repeatedly has promised, the headline number would be $25,000 per car-- not $250,000. You would divide the $1.5 billion by 60,000 instead of 6,000.
But why stop at a year from now? This investment in automotive propulsion technology is meant to be refined and influence generations of cars for decades. Some part of GM's Voltec architecture and techniques will drive sales of approximately 60 million cars over the next 25 years or so, in any reasonable estimation.
[...]
The absurdity of the math used can be further shown by asking what the study would have yielded if it had been done six months ago or a year ago. Six months ago, 3,000 Volts had been sold and therefore the implied subsidy was $500,000 per car -- half as many cars, twice the subsidy per car. One year ago, the first Volt was sold and therefore this one car must have cost $1.5 billion, according to the reasoning by the people who wrote the headlines around this study.
This is the way it works in almost every industry. The first iPad manufactured probably cost Apple $100 million or whatever. Does that mean Apple lost $100 million minus $500 on this iPad? Of course not. The development cost for any product is written off across large volumes, typically multiple generations, where both hardware and software accumulate constantly. [TheStreet.com, 12/22/11]
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MYTH: Each Volt Cost Taxpayers More Than $250,000 In Subsidies
In a CBS news brief, Ashley Morrison stated: "According to a new report, every car sold so far has cost taxpayers as much as two hundred and fifty thousand dollars." [CBS, CBS Morning News, 12/22/11, via Nexis]
Fox News promoted the figure on Fox & Friends, Special Report, and The Five (twice). Fox Business covered the figure in at least 9 segments. [Media Matters, 12/22/11] [Nexis search, 1/20/12]
Rush Limbaugh and numerous conservative blogs repeated the figure. [RushLimbaugh.com, 1/11/12] [HumanEvents.com, 1/7/12] [Washington Examiner, 1/23/12] [National Review Online, 12/21/11] [MichelleMalkin.com, 12/21/11] [Hot Air, 12/21/11]
FACT: Subsidy Estimate Was Based On Fuzzy Math
Estimate Includes Subsidies For Supplier Companies And Subsidies That Haven't Actually Been Distributed. The source of the claim that each Volt costs taxpayers $250,000 in subsidies is James Hohman of the Mackinac Center for Public Policy, a conservative think tank that has received money from fossil fuel interests. The estimate, which Hohman conceded was "simple math," included state and federal subsidies "via tax credits and direct funding for not only General Motors, but other companies supplying parts for the vehicle." It also included subsidies that the companies haven't yet received. Hohman divided that total by 6,000 - the number of Volts sold at the time. [Media Matters, 12/22/11]
Finance Writer: "Fundamental Flaw" In The Estimate "Discredits The Entire Report." Writing for TheStreet.com, Anton Wahlman - who said he is "totally opposed to government subsidies" -- stated that "there is a fundamental flaw behind the math in this 'report' that discredits the entire report straight down to zero, in my view." From his post:
Here is the point: Why divide whatever amount -- $1.5 billion or otherwise -- by the number of Chevrolet Volts sold to date? If he had done this study one year from now, when we could be looking at 60,000 Volts made, as GM repeatedly has promised, the headline number would be $25,000 per car-- not $250,000. You would divide the $1.5 billion by 60,000 instead of 6,000.
But why stop at a year from now? This investment in automotive propulsion technology is meant to be refined and influence generations of cars for decades. Some part of GM's Voltec architecture and techniques will drive sales of approximately 60 million cars over the next 25 years or so, in any reasonable estimation.
[...]
The absurdity of the math used can be further shown by asking what the study would have yielded if it had been done six months ago or a year ago. Six months ago, 3,000 Volts had been sold and therefore the implied subsidy was $500,000 per car -- half as many cars, twice the subsidy per car. One year ago, the first Volt was sold and therefore this one car must have cost $1.5 billion, according to the reasoning by the people who wrote the headlines around this study.
This is the way it works in almost every industry. The first iPad manufactured probably cost Apple $100 million or whatever. Does that mean Apple lost $100 million minus $500 on this iPad? Of course not. The development cost for any product is written off across large volumes, typically multiple generations, where both hardware and software accumulate constantly. [TheStreet.com, 12/22/11]
Sent from my iPad using Tapatalk HD
