"These guys are losing money selling cars. They're making money selling credits."

 If you've been reading LITD for any length of time, you know that it's pretty purist in its defense of free-market economics. If a person or organization comes up with a product or service, it ought to thrive or wither based on its ability to hold its own in the marketplace. It ought to attract enough consumers who see value in the confluence of price point and appeal that it doesn't need a leg up from government.

Now, consider one Elon Musk, a very rich guy. He's mainly made his splash so far in life selling electric cars. 

But do they meet the above criterion for being economically viable?

Um, no. They continue to roll off the assembly line and the dealership lot because the company is involved in government funny business in the form of something called "regulatory credits":

Tesla posted its first full year of net income in 2020 -- but not because of sales to its customers.

Eleven states require automakers sell a certain percentage of zero-emissions vehicles by 2025. If they can't, the automakers have to buy regulatory credits from another automaker that meets those requirements -- such as Tesla, which exclusively sells electric cars.

It's a lucrative business for Tesla -- bringing in $3.3 billion over the course of the last five years, nearly half of that in 2020 alone. The $1.6 billion in regulatory credits it received last year far outweighed Tesla's net income of $721 million -- meaning Tesla would have otherwise posted a net loss in 2020.

"These guys are losing money selling cars. They're making money selling credits. And the credits are going away," said Gordon Johnson of GLJ Research and one of the biggest bears on Tesla(TSLA) shares.

Tesla top executives concede the company can't count on that source of cash continuing.

"This is always an area that's extremely difficult for us to forecast," said Tesla's Chief Financial Officer Zachary Kirkhorn. "In the long term, regulatory credit sales will not be a material part of the business, and we don't plan the business around that. It's possible that for a handful of additional quarters, it remains strong. It's also possible that it's not."

You know what I think is the most glaringly key word in the above excerpt? "Require."

What the hell is government doing requiring any manufacturer of any product to make that product according to some requirement that comes from outside the company doing the manufacturing?

Well, comes the rejoinder from the busybodies who want us to resign ourselves to a permanent state role in what is made, how it's made, and how it's sold, the global climate is in dire trouble and we have to wean ourselves off fossil fuels as soon as possible.

And if you come back by citing the ample data showing that the global climate is in no such trouble, they trot out their own pointy-heads who say it is, and everybody goes down the rabbit hole for who knows how long.

But acting on the flawed presumption that it is so leads to shenanigans like this. 

And the general public shrugs and assumes it has to be this way.