It is rare — and I’m talking “Harry Reid Says Something Smart” rare that I become separated from the likes of the thinkers at the Wall Street Journal and Forbes.
They say Nevada gave away the store to get Tesla’s gigafactory to make the electric car company’s batteries. Nevada beat out California, Texas, Arizona, and New Mexico.
Nevada offered Tesla a $1.25 billion deal to locate its plant outside Reno.
Forbes reports that “The four bills provide the company with tax abatements as well as permission to sell its vehicles directly to Nevada consumers, if Tesla invests $3.5 billion within the next 10 years. The legislation was enacted only a week after Tesla chose Nevada over Arizona, California, New Mexico and Texas for the big battery plant. The project is expected to create 6,500 jobs at the plant, with more expected through road construction and other improvement projects.”
Actually, it’s reported now that Tesla will only have to create 6,000 jobs and not all of those jobs have to be at the battery factory. But let’s not quibble about the details at the margin.
What’s key for Nevada — and this is why I support the Tesla deal — is Nevada finally landed a big one in the economic game of diversification.
Gaming is the big industry in Nevada. And it probably always will be. But for 50 years Nevada leaders have been unable to significantly diversify the economy.
Yes, Nevada has mining, a bit of ranching and a military component to its economic base. But nothing that could truly sustain the state in the style for which it is accustomed if gaming went south.
The value of landing the Tesla plant is twofold:
First, it does indeed create good jobs. Might be 3,000. Might be 6,000. Either way it way more good paying jobs than Nevada would have had had it lost the Tesla sweepstakes.
Second, Tesla could become a “bell cow” for more industry — companies related to the battery gigafactory, or businesses attracted to the state by the Tesla experience.
You cannot overestimate how important that is to a state that’s been clobbered by the Obama economy. Hell, forget about the economy. President Obama himself has done more to hammer the Las Vegas travel economy than any president ever.
In the world of diversification, Gov. Brian Sandoval did one thing very right: He understood that to compete with California and Texas, Nevada needed to go big or go home.
He went big and that’s good on him.
Is it a risk? You bet. If Tesla technology doesn’t carry the day, Nevada gets the short end of the stick. But if it does carry the day, Nevada becomes an important player in the electric car evolution. That makes Tesla’s initial cost to Nevada a non-factor.
So, I’m all in with the Tesla deal because as Nevada knows all to well, there is no substitute for winning.