Elon Musk: On Obama, Climate Change & Government Regulation (Transcript)

Elon Musk: On Obama, Climate Change & Government Regulation (Transcript)

By Alison van Diggelen, host of Fresh Dialogues

As the nation anticipates a “climate friendly” State of the Union speech from President Obama Tuesday, let’s take a look at what one of Silicon Valley’s most successful innovators and job creators has to say about the government’s role in climate change and innovation.

Last month, I interviewed Tesla Motors and SpaceX CEO, Elon Musk at the Computer History Museum in Silicon Valley and asked him what specifically President Obama can do to stimulate the economy. He acknowledges that presidents can only do so much, saying,”You’re actually like the captain of a very huge ship and have a small rudder.”

Musk argues that too much government regulation can stand in the way of innovation, especially in the auto industry; and is generally in favor of minimal government intervention in the economy. On climate change, however, he was forceful and described our oil based, carbon intensive economy as creating a “crazy chemical experiment on the atmosphere” with likely catastrophic consequences. He concludes that taxing carbon is vital.
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Here is the transcript of our conversation:

Alison van Diggelen: Do you feel the government is standing in the way of innovation at all?

Elon Musk: Well sometimes…I don’t think the government tends to stand in the way of innovation but it can over-regulate industries to the point where innovation becomes very difficult. The auto industry used to be a great hotbed of innovation at the beginning of the 20th Century. But now there are so many regulations that are intended to protect consumers…I mean the body of regulation for cars could fill this room. It’s just crazy how much regulation there is. Down to what the headlamps are supposed to be like. They even specify some of the elements of the user interface on the dashboard…some of these are completely anachronistic because they’re related back to the days when you had a little light that would illuminate an image. So we had to reserve space on the instrument panel of the Model S for where all of the indicators…that a car would have…you know you’ve got these little lights…

Alison van Diggelen: Check engine or whatever…

Elon Musk: Yeah…all these little things. There is a whole bunch of them. ‘We can’t have anything else in that space. ‘ But how about we have one space and render a different graphic? ‘Oh no, because people are expecting to see them in this space.’ Nobody is expecting to see them in that space.

Alison van Diggelen: So you can’t argue with these regulations?

Elon Musk: Well you can argue with them, but not with much success. (laughter). You can actually get these things changed, but it takes ages. Like one of the things we’re trying to get is: why should you have side mirrors if you could have say, tiny video cameras and have them display the image inside the car? But there are all these regulations saying you have to have side mirrors. I went and met with the Secretary of Transport and like, can you change this regulation…? Still nothing has happened and that was two years ago.

Alison van Diggelen: So you’re banging your head against the wall…

Elon Musk: We need to get these regulations changed.

Elon Musk interview with Alison van DiggelenAlison van Diggelen: So talking of government, President Obama is obviously trying to do what he can…if you had five minutes with President Obama, what would you advise him for one: stimulating the economy and entrepreneurship and (two)  creating jobs. Is there one thing if he could successfully get through that would be a big stimulus?

Elon Musk: I think actually…the reality of being president is that you’re actually like the captain of a very huge ship and have a small rudder (laughter). If there was a button that a president could push that said ‘economic prosperity,’ they’d be hitting that button real fast…

Alison van Diggelen: Full steam ahead.

Elon Musk: You can imagine…the speed of light, how fast they’d be pressing that button. That’s called the re-election button. I’m not sure how much the president can really do. I’m generally a fan of minimal government interference in the economy. The government should be the referee but not the player. And there shouldn’t be too many referees. But there is an exception, which is when there’s an un-priced externality, such as the CO2 capacity of the oceans and atmosphere. So, when you have an un-priced externality, then the normal market mechanisms don’t work and then it’s the government’s role to intervene in a way that’s sensible. The best way to intervene is to assign a proper price to the common good that is being consumed.

Alison van Diggelen: So you’re saying there should be a tax on gas?

Elon Musk: There should be a tax on carbon. If the bad thing is carbon accumulation in the atmosphere, then there needs to be a tax on that. And then you can get rid of all subsidies and all, everything else. It seems logical that there should be a tax on things that are most likely to be bad. That’s why we tax cigarettes and alcohol. These are probably bad for you, certainly cigarettes are (laughter). So you want to err on the side of taxing things that are probably bad. And not tax things that are good. Given that there is a need to gather tax to pay for federal government…We should shift the tax burden to bad things and then adjust the tax on bad things according to whatever’s going to result in behavior that we think is beneficial for the future.

I think currently that what we’re doing right now, which is mining and burning trillions of tons of hydrocarbons that used to be buried very deep underground, and now we’re sticking them in the atmosphere and running this crazy chemical experiment on the atmosphere. And then we’ve got the oil and gas companies that have ungodly amounts of money. You can’t expect them to roll over and die. They don’t do that. What they much prefer to do is spend enormous amounts of money lobbying and running bogus ad campaigns to preserve their situation.

It’s a lot like tobacco companies in the old days. They used to run these ad campaigns with doctors, guys pretending they were doctors, essentially implying that smoking is good for you, and having pregnant mothers on ads, smoking.

Alison van Diggelen: Do you have a message for the climate change skeptics and the big oil people?

Elon Musk: Well, as far as climate change skeptics…I believe in the scientific method and one should have a healthy skepticism of things in general…if you pursue things from a scientific standpoint, you always look at things probabilistically and not definitively…so a lot of times if someone is a skeptic in the science community, what they’re saying is that they’re they’re not sure that it’s 100% certain that this is the case. But that’s not the point. The point is, to look at it from the other side. To say: What’s the percentage chance that this could be catastrophic for some meaningful percentage of earth’s population? Is it greater than 1%? Is it even 1%? If it is even 1%, why are we running this experiment?

Alison van Diggelen: You’ve called it Russian roulette. We’re playing Russian roulette with the atmosphere…

Elon Musk: We’re playing Russian roulette and as each year goes by we’re loading more rounds in the chamber. It’s not wise. And what makes it super insane is that we’re going to run out of oil anyway. It’s not like there’s some infinite oil supply. We are going to run out of it. We know we have to get to a sustainable means of transportation, no matter what. So why even run the experiment? It’s the world’s dumbest experiment (applause).

 

Read more Transcript Excerpts from our 2013 interview:

On Musk’s South African Childhood, Iron Man Inspiration

On Being the Reluctant CEO of Tesla Motors

On Steve Jobs, Innovation and Critics

On Team Building, Warren Buffett, and Mars

 

Tesla’s Model X: Made in California

Tesla’s Model X: Made in California

By Alison van Diggelen, host of Fresh Dialogues

Fresh Dialogues is delighted to announce that it is now a regular contributor to KQED’s Climate Watch, a multimedia initiative focusing on climate science and policy issues in California. Fresh Dialogues stories will focus on the intersection of clean tech and climate change.

Here is our first story for the NPR affiliate.

On February 8th, Tesla Motors CEO, Elon Musk, unveiled the company’s latest electric car: The Model X. Probably the sleekest and sexiest SUV you’ve ever seen, and also the priciest. But what’s most remarkable — beyond the falcon wings — is that the car will be manufactured here in the Golden State, at the former NUMMI plant in Fremont.

Why did Tesla choose to locate its headquarters and manufacturing in the high-priced San Francisco Bay Area? Was it linked to the state’s ambitious clean energy targets and policies? The new rules approved last month by the California Air Resources Board require automakers to produce 1.4 million zero-emission cars for the California market by 2025, and are part of the aggressive goal of reducing the state’s emissions 80% by 2050.

Tesla spokesperson Khobi Brooklyn eschewed policy explanations and told me, “We wanted to build our cars in California, not only creating jobs in the U.S., but also California specifically.” She cited Silicon Valley as “an incredibly rich pool of talent” and said that purchasing an existing car manufacturing facility saved money and time in preparing for car production. I’ve no doubt the California sales tax rebates on capital equipment purchasing (estimated at $20 Million) helped too.

California’s Governor Jerry Brown attended the Model X unveiling, and basked in the Tesla limelight. He was obviously delighted to be part of some good news from the Golden State for a change. “We can work our way out of our mess with creativity, openness and the kind of spirit that’s willing to take risks,” he said to the rowdy audience of Tesla groupies.

Clean Energy, Really?

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Michelle Obama: How big is her green influence?

Michelle Obama: How big is her green influence?

By Alison van Diggelen, host of Fresh Dialogues

How much influence does First Lady Michelle Obama have on the President and his green policies? I put this question to David Axelrod, President Obama’s chief political strategist and his answer was candid: ENORMOUS.

Michelle Obama is well known for her Let’s Move campaign which puts good eating and anti-obesity front and center, so it’s easy to imagine this talented Harvard educated lawyer and mentor in chief is also making her views heard in the White House on issues beyond healthy eating and healthy living….including the health of the planet, climate change and even energy policy.

It was her organic kitchen garden at the White House which put Michelle Obama’s true (green) colors in the international spotlight in 2009. Fans have applauded her bold green action – planting the first kitchen garden since Eleanor Roosevelt’s Victory Garden – but Obama’s raised beds of organic arugula, spinach and Thai basil also caused a firestorm of complaint in the agriculture industry. It even inspired a priceless Little Shop of Horrors segment on the Daily Show.

In April this year, just in time for Earth Day, Michelle Obama’s first book American Grown, will be released and we’ll learn more from the First Lady about how her daughters, Malia and Sasha inspired her to rethink healthy eating and develop green thumbs. Like legendary chef, Alice Waters, she believes that increased access to healthy, affordable food can promote better eating habits and improve health of families and communities across America.

In a New York Times article, Obama explained her kitchen garden rationale. For children, she said, food is all about taste, and fresh and local food tastes better.

“A real delicious heirloom tomato is one of the sweetest things that you’ll ever eat,” she said. “And my children know the difference, and that’s how I’ve been able to get them to try different things.

“I wanted to be able to bring what I learned to a broader base of people. And what better way to do it than to plant a vegetable garden in the South Lawn of the White House?”

For his part, David Axelrod declares that the vegetables served at White House dinners are tasty but attributes it to both the organic garden and the wonderful White House chefs.

Read transcripts, see photos and check out our ARCHIVES featuring exclusive interviews with Tom Friedman, Paul Krugman, Vinod Khosla and many more green experts and visionaries…

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Paul Krugman: On China and Climate Change Transcript

Paul Krugman: On China and Climate Change Transcript

By Alison van Diggelen, host of Fresh DialoguesPaul Krugman, Alison van Diggelen-Fresh Dialogues Interview

This exclusive interview with Nobel Prize winner, Paul Krugman was recorded on November 12, 2009 in Silicon Valley. Dr. Krugman was in town to deliver a lecture as part of the Foothill College Celebrity Forum Series. Here is the transcript of Part Two: On China and Climate Change. To listen to this interview click here and or watch video (coming soon)

Alison van Diggelen: Paul thank you very much for joining me today on Fresh Dialogues.

Paul Krugman: OK. Good to be doing this.

Alison: Talking about other countries, Spain took the lead… Denmark is taking the lead… China is now way ahead of us in certain clean energy technologies. Do you feel that we’ve lost eight years and we have at least eight years to catch up?  Is it feasible we can catch up?

Paul: It’s always feasible. You don’t want to get too hung up on the specific sexy technologies. I guess the Danes are ahead of us in building wind turbines. But a lot of what we’re going to be doing on the environment is  going to be… insulation, clever urban design to minimize energy loss. That’s all stuff that’s coming along and look – the history of information technology has said very clearly that nobody gets a monopoly for very long… I don’t get anxiety about it. I’m just more concerned that we won’t do what we need to do to protect the environment.

Alison: How big is the role of government? Ultimately it’s the private sector investment that’s going to make the substantial investment…

Paul: But the government has to provide the incentives…what we have now is the economic concept of an externality…if you have something where you impose costs on other people but you don’t have any incentive to reduce those costs, bad stuff happens. And climate change is the mother of all externalities. It’s a gigantic thing and the private sector by itself is not going to deal with it. Left without any government intervention, we’re just going to basically par-boil the planet, right?

So what you have to do is have a set of rules in place. Now the idea is for it to be market oriented. Yes, there can be some public research, some public investment, some things will have to be done directly by government… but mainly put in a cap and trade system – put a price on greenhouse gas emissions and then let the private sector do its stuff.

Alison: Right. Why is it you favor a cap and trade system over a straight carbon tax?

Paul: Oh, there are a couple of reasons. One is, right now, cap and trade looks like it might pass Congress and a direct tax will not. Partly that’s because cap and trade is relatively well suited to paying off the industry groups, right? We live in the real world. By handing out some of the licenses, at least in the first decade or so, you make it easier to swallow.

International coordination is easier with cap and trade. If we say to the Chinese – well we want you to have a carbon tax – how can we really tell it’s enforced? But if we negotiate with the Chinese that they will have total CO2 emissions of so much, we can monitor pretty well whether that’s actually happening. So that’s a lot easier to envision an international  agreement with cap and trade.

So, I would take a carbon tax if…

Alison: If it were politically feasible?

Paul: It’s not clear to me that it’s even superior. But it would be OK, certainly. The fact is, cap and trade could be a bill by this time next year. A carbon tax is like single payer health care. It’s not going to happen this decade and I want something to actually happen now.

Alison: Paul Krugman, thank you very much I really appreciate your taking the time.

Paul: Thank you so much.

Check back soon for more interview segments on the stimulus package, what gave him that “missionary zeal” to write such fervent columns in the New York Times, and whether the green economy can be our salvation.

 To check out more exclusive Fresh Dialogues interviews, click here

Listen to Part One: Paul Krugman’s advice on Obama’s Job Summit

 Part Two when Paul Krugman discusses China, Climate Change and clean technology

Paul Krugman: On China, Climate Change

Paul Krugman: On China, Climate Change

By Alison van Diggelen, host of Fresh DialoguesPaul Krugman, Fresh Dialogues interview

Download or listen to this lively Fresh Dialogues interview

 

We welcome feedback at FreshDialogues.com, click on the Contact Tab | Open Player in New Window

Here’s the transcriptSEE VIDEO of Part One (Part Two coming soon)

In advance of Obama’s trip to China this week, Nobel Prize winner, Paul Krugman gave a short, sharp economics lesson on climate change and China during our exclusive interview in Silicon Valley, November 12. What does he think the US and Chinese governments should be doing to combat climate change and stimulate the green sector?

Why is he not concerned about China’s lead in clean energy technology?

Krugman explains why negotiating with China over CO2 emissions would be preferable to trying to enforce a carbon tax. Hear all this and more in this Fresh Dialogues interview.

Here are selected quotes:

“Climate change is the mother of all externalities…left without any government intervention, we’re going to basically par-boil the planet.”

“You don’t want to get hung up on the specific sexy technologies (like wind turbines)…look at the history of information technology…nobody gets a monopoly for very long.”

“If we say to the Chinese, we want you to have a carbon tax – how can we really tell it’s enforced? But if we negotiate with the Chinese that they will have total CO2 emissions of so much, we can monitor that pretty well.”

For Part One of the Paul Krugman interview – on Obama’s Job Summit click here

The interview was recorded at Foothill College Celebrity Forum Series on November 12, 2009. With special thanks to Dick Henning.