In the long-run, things that make life easier win, and people who try to stop those things lose.
If Tesla wants to sell me a car and I want to buy a Tesla, I fail to see how that is any of the government’s business. If Tesla wants to buy a piece of land and plop a few cars on the lot for folks to consider buying, I once again struggle to understand how it is the government’s business.
Under current Mississippi law, Tesla can open that dealership and sell me that car. But for two years, the Legislature has maneuvered, under intense pressure from automobile dealerships, to put the kibosh on that possibility. (The origin of “kibosh” is disputed. It might come from the French word to decapitate a deer or the Irish word for the death cap put on someone’s head before they were hung).
Ain’t freedom grand?
Last year’s HB 833 made it to the end of session before it ran out of juice. This year, the Legislature appears to be fast tracking HB 401 at speeds that would impress a Tesla Model S owner (0-60 in 1.99 seconds, if you’re curious). The bill prevents an automobile manufacturer, or a subsidiary, from obtaining a dealer license. Mississippi law requires a dealer license to sell a car here legally. It essentially prevents direct sale and requires a manufacturer to establish a franchise dealership model.
The bill originally included an exception for an EV manufacturer, like Tesla, that has no franchise dealers in Mississippi. The House stripped that language in floor debate. The bill passed the chamber, 105-9, and was transmitted to the Senate yesterday.
It’s not personal, it’s only business
For the record, I have nothing against automobile dealerships with shiny rows of metal glistening in the sun. I also am not ate up with EVs. I drive a 2014 car that still sips on only the finest unleaded petrol that can be pulled from the ground.
There is a broader principle here, though. It is this: grown adults should be able to take the money they earn and buy the car they want, how they want. For some, that may mean going to a dealership lot and getting hands-on service. For others, that could mean something radically different—like ordering directly from a manufacturer. Different strokes for different folks.
If a manufacturer wants to sell cars direct, the way Apple sells iPhones, it should be allowed unless doing so would violate a contractual agreement with a franchisee. To my knowledge, AT&T has never asked the Legislature to ban Apple from selling directly at their cube stores and the Legislature has never seriously entertained such a proposition.
Change is scary, though. Allowing different business models to compete for the same customers might result in older business models having to change. So I understand the allure of lobbying government to stop would-be competition. Of course, new-fangled approaches do not always work in the market. Coca-Cola once thought New Coke was a good idea. Sometimes legacy businesses prove quite resilient.
Legislature ill-equipped to centrally plan MS economy
It is dangerous, though, when politicians try to prevent economic progress to protect established interest. Why you say?
It simply is not the job of government to order the economy. It’s too complex. Consumer wants are too subjective. The people in government are unqualified to centrally plan. So am I. So are you.
Free enterprise created the greatest wellbeing in human history. It works because I get to give my money to the people and businesses that I think are most deserving, or that create the most value for me and my family. You get to do the same. Sometimes we will make similar decisions. Sometimes not. But the competition for our dollars lead to greater variety, and better goods and services. When you hear a politician on the campaign trail say “I’m a free market conservative,” this is what they mean.
Stopping new products or business models is fear-based governing. “What if customers like this other thing better than my thing?” But if the root of that fear is warranted, then politicians are effectively stopping something customers would like better. They are denying citizens something they want. That kind of sounds like the opposite of “free market.”
Finally, innovation is like water, or those dinosaurs in Jurassic Park. It finds a way. Buggy and whip manufacturers almost certainly hated Henry Ford. Lamp and candle makers almost certainly hated Edison. But those innovations still prevailed and we are better off for it. In the long-run, things that make life easier win, and people who try to stop those things lose.
Mississippi is the hospitality state. New ideas should be welcome with a glass of sweet tea. Economies grow and people prosper where the freedom to innovate reigns. The Legislature should pull the plug on efforts to shut Tesla out.
Russ Latino
