The Latin proverb audentes Fortuna iuvat is usually translated into English as “Fortune favors the bold.” It has been used by a variety a martial organizations in the West over the centuries. For example, it appears on the regimental insignia of the 3rd Marine Regiment. The British SAS uses “who dares wins” as their motto. The American idiom, “he who hesitates is lost”, is a mistranslation of Cato, but again, the appeal is obvious so it’s easy to see why it has become common.
The point being is that acting boldly has always been seen as a benefit. We associate it with the successful. It’s why mothers tell their sons to stand up straight. It’s why fathers teach their sons to have a firm handshake. The confident guy, who bounds into a room and takes charge will get little push back, because people naturally pick up on his confidence. Boldness is an essential element of leadership. Men will follow a leader who is confident, even if they have their private doubts about the plan.
Boldness is also a good way to rob people.
Victor Lustig was a confidence man living in Paris after the Great War. He read in the newspaper that the city was having trouble maintaining the Eiffel Tower. Lustig came up with an outlandish scheme where he would use that story to sell the Eiffel Tower for scrap iron. He forged some documents and cooked up an elaborate story about how he had been tasked to secretly find some buyers. He found some interested parties, had them picked up in limousines for a tour of the Tower and then convinced one of them, Andre Poisson, to make a bid.
That sounds quite ballsy, but he went further. Poisson’s wife suspected that Lustig may not have been on the level. Lustig decided to use this to his advantage so he met with the couple and confessed that he was actually a government employee, not an agent hired by the city. He made it clear that he was not paid well and was hoping to improve on that by finding the right buyer. In other words, he wanted a bribe. This sealed the deal and Andre Poisson, not only bought the Eiffel Tower, he paid Lustig a bribe to do it.
Every time I see a story about Elon Musk, I think of Victor Lustig. The reason for that is Musk often turns up in the news attached to some bold new scheme to do something most people see as futuristic or massively complicated. He’s sort of a Phileas Fogg, that is always announcing some grand new adventure. The publicity stunts have no real bearing on his alleged project, but he puts a lot of effort into getting public notice for them. There is a P.T. Barnum quality to it that does not quite square with the official story.
The tunneling under Los Angeles story is a good example. There’s nothing new about this idea. The Crossrail is a giant rail tunnel under the city of London that was done using boring machines. It is a 26-mile tunnel that was threaded between the exiting tunnels under the city. There was a recent documentary on it, which is probably where Musk got the idea. The London tunnel is an amazing bit of engineering because there’s a ton of stuff under the city that the tunnelers had to dodge as they dug the thing.
That’s not to say doing such a thing under Los Angeles would be easy, but it is hardly a brilliant futuristic idea. In fact, people have suggested this in the past, but such a project would require tens of billions in tax money. More important, there’s no real reason to do it, other than the fact California is a failed state so building roads and bridges the old way is impossible. Musk is levering that reality to propose his futuristic “solution” for the transport problems of Los Angeles. What a guy!
That’s probably the point of the hype. Tesla, Musk’s one big “successful” scheme is entirely dependent on tax dollars. Take away the subsidies and it goes bust. The same is true of the battery schemes, the solar plant, the space program. According to the LA Times, Musk has netted close to $5 Billion in government money. Not all of it is tax money, of course. A lot of it comes in the form of grants for research and credits for doing government approved projects, like making solar panels. It’s not unreasonable to say the Musk is a tax sink.
There’s also a good chance that like Lustig, Musk works both sides of the street. He gets a bunch of attention for some new project, like digging a tunnel under Los Angeles. He then gets investors lined up, promising tax schemes that will multiply their investment, in addition to getting government support for the project. Since Musk appears to have skin in the game and is wildly confident his plan will work, investors line up. Once it all comes together, Musk is a minority share holder, but in full control of the project.
The formula is to use the media to promote the idea to the public. He then gets some other billionaires to back it on condition that Musk can get the government invested. That is used to pure the state into the scheme, which seals the deal with the private equity guys. From there it is just a churn as Musk and his buddies get their seed money out with interests as new investors demand to get in on the action. Since these projects take decades, the risk of it unraveling in the short term in minimal.
The best part of a scheme like this is he can get his seed money out early and still have equity in the new project. The investors and the government are on the hook and they will keep putting money into it no matter how many times a Space X rocket explodes or a Tesla bursts into flames. That’s not to say Musk is a con man like Lustig. The main difference is that Lustig was breaking the law, while Musk is well within the law. In fact, his innovation is to make the law his partner.
Musk is a modern incarnation of P.T. Barnum, pitching the attractions of the technocratic state via public-private partnerships. Barnum would find exotic acts to put inside his act, while Musk finds big technology projects. Instead of getting the public to buy a ticket to see the bearded lady or wolf boy, Musk gets the public to support the expenditure of public funds for his latest whiz bang idea. In the process, he and his associates get an exclusive investment opportunity and make millions from schemes that tend not to result in much of anything, other than hype.
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