- $300,000 for married couples filing jointly
- $225,000 for heads of households
- $150,000 for all other filers
China’s BYD Tops Tesla
Meanwhile, check out this headline on the front page of the printed Jan. 3 Financial Times (FT): “China’s BYD takes Tesla’s spot as world’s biggest electric car maker: US group posts fewer quarterly sales; Price cuts spur rival; Consumers shift to cheaper vehicles.”The story: “The US group handed over 484,000 cars in the fourth quarter, more than the 473,000 anticipated by analysts but not enough to hold on to its title after BYD reported record sales of battery-only vehicles of 526,000 for the same period.
“Tesla’s dethroning by BYD reflects the rise of what was a little-known Chinese group only a decade ago, which Musk himself has publicly dismissed. While growth at the Warren Buffett-backed Chinese company has been mostly achieved on its home turf, BYD is sharpening its focus on finding new foreign markets including in Europe.
“Danni Hewson, head of financial analysis at AJ Bell, said BYD’s electric cars were ‘becoming increasingly visible on European roads thanks to keen pricing.’”
Notice a big winner here is super-investor Warren Buffett: “The Chinese group’s early success prompted Buffett’s Berkshire Hathaway to invest in the company in 2008. Despite relying on existing industry technology for many years, BYD has focused on stripping out costs from the production process.”
This shows how Mr. Buffett became the world’s most successful investor by closely monitoring government policies, here and abroad. He saw how California and other states were pushing electric vehicle mandates, then invested in a Chinese company making cheaper models.
It was of no concern to him that BYD, like all major Chinese companies, was tightly linked to the Chinese Communist Party (CCP). FT reported, “Following years of state support and careful industrial planning by Beijing”—that is, by the CCP—“China’s automakers now leverage their country’s control over the production of almost every resource, material and component used to make electric vehicles.”
The Rise of State Capitalism
What’s going on was described in a 2016 book, “State Capitalism: How the Return of Statism is Transforming the World,” by Joshua Kurlantzick. State capitalism combines elements of government ownership and control with competing in global markets. For example, BYD and other companies controlled by the CCP sell their products on the world market; therefore, they have to meet the needs of global customers. That means there are profits—which go to the party and its top members.According to Mr. Kurlantzick, state capitalism is “more protectionist, more dangerous to global security and prosperity, and more threatening to political freedom” than free market economies.
US, California Policies Boost State Capitalism
Unfortunately, the U.S. and California polices boost state capitalism, both here and abroad. We have few industries directly owned by the government, such as the U.S. Postal Service or the California High-Speed Rail Authority. But we do have direct state manipulation of markets, in particular the huge vehicle industry.Without the mandates and subsidies, the EV industry in America, especially California, would be a lot smaller than it is today. That would have given less impetus to the growth of the EV industry, including BYD and other companies in communist China.
- $224,762 to the National Republican Congressional Committee
- $207,500 to GOPAC
- $159,024 to the National Republican Senatorial Committee
- $87,897 to the Republican National Committee
- $248,500 to the Democratic Congressional Committee in 2019
- $33,900 to the Democratic Senatorial Campaign Committee in 2018
- $5,600 to Sen. Mark Kelly of Arizona in 2018
- $2,700 to Rep. Donna Shalala of Florida in 2018
Chinese Socialism
After Chairman Mao died in 1976, under Deng Xiaoping, China moved from hard-core Maoist central planning to what Deng called “socialism with Chinese characteristics.” It seemed a contradiction because markets were introduced and the country apparently was moving toward U.S.-style free markets. But now we know what was meant: state capitalism.In Soviet days, anti-communists like me used to cite a maxim attributed to Lenin, the first Soviet dictator: “When it comes time to hang the capitalists, they will vie with each other for the rope contract.”
Today, with the colliding U.S. and California policies on EVs helping communist China, the rope will be delivered in a BYD Yangwang U8 driven by Gavin Newsom.