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How does that affect retailers being unable to get supply?

cperciva 4y ago
It increases demand for that particular brand, but manufacturers don't want to invest in increasing their production levels in case they don't win the contract for the next round.
- ClumsyPilot 4y ago
  So its not all government's fault
  - mcguire 4y ago
    It's always the government's fault.
    - ClumsyPilot 4y ago
      Even if the government was not involved, it was government's fault for not being involved. Just look at the sister thread 'why didn't government stockpile my freemarket products for me'
    - throwaway0a5e 4y ago
      Only when the government specifies how things must be done. You break it you bought it.
      - ClumsyPilot 4y ago
        So we have the entire globalised supply chain of fast fashion, every time counterfeit goods or clothing made by slave labour is discovered, which corporation owns up?
      - mcguire 4y ago
        Do you remember when some Chinese baby formula producers were including melamine powder to increase their apparent protein content, or was that before you were born?
  - barry-cotter 4y ago
    If you deliberately design an extremely brittle system you are at fault for designing a brittle system.
elihu 4y ago
Imagine that EV tax credits worked the way infant formula works. Within each state, that state would produce a contract for supply of electric vehicles and open it up for bidding. The manufacturer with the cheapest car wins the bid. Let's say it's the Nissan Leaf. Within that state, Nissan agrees to sell the Leaf at a given price, and the state gives coupons to prospective car buyers good for $7500 off the price of a new EV (paid for through Federal grants to the state), but it can only be used if you buy a Leaf. That's sort of okay as long as Nissan can keep up with demand (not everyone wants a Leaf but at least one cheap EV is on the market), but let's say they're hit with a supply chain issue and can't get a critical part. Other manufacturer might be able to step in, but they're not participating in the EV rebate program so customers have to pay full price. And in this alternate reality those manufacturers probably don't make cheap or even mid-range EVs anyways because it's not profitable -- they can't compete with Nissan because they're at a $7500 price disadvantage, so they focus on selling cars for rich people. The Tesla Model S might exist, but the Model 3 probably wouldn't. A system of artificial and completely unnecessary monopoly would stop a whole competitive industry from forming.
- diordiderot 4y ago
  Who the hell thought that this system was a good idea? Is it corruption?
  - elihu 4y ago
    It sure looks like regulatory capture to me (what better way for a major incumbent to establish an economic moat to prevent any competition in their market?), but it's possible that congresspeople legitimately thought it was a good idea at the time.

It increases demand for that particular brand, but manufacturers don't want to invest in increasing their production levels in case they don't win the contract for the next round.

ClumsyPilot 4y ago
So its not all government's fault
- mcguire 4y ago
  It's always the government's fault.
  - ClumsyPilot 4y ago
    Even if the government was not involved, it was government's fault for not being involved. Just look at the sister thread 'why didn't government stockpile my freemarket products for me'
  - throwaway0a5e 4y ago
    Only when the government specifies how things must be done. You break it you bought it.
    - ClumsyPilot 4y ago
      So we have the entire globalised supply chain of fast fashion, every time counterfeit goods or clothing made by slave labour is discovered, which corporation owns up?
    - mcguire 4y ago
      Do you remember when some Chinese baby formula producers were including melamine powder to increase their apparent protein content, or was that before you were born?
- barry-cotter 4y ago
  If you deliberately design an extremely brittle system you are at fault for designing a brittle system.

elihu 4y ago

Imagine that EV tax credits worked the way infant formula works. Within each state, that state would produce a contract for supply of electric vehicles and open it up for bidding. The manufacturer with the cheapest car wins the bid. Let's say it's the Nissan Leaf. Within that state, Nissan agrees to sell the Leaf at a given price, and the state gives coupons to prospective car buyers good for $7500 off the price of a new EV (paid for through Federal grants to the state), but it can only be used if you buy a Leaf. That's sort of okay as long as Nissan can keep up with demand (not everyone wants a Leaf but at least one cheap EV is on the market), but let's say they're hit with a supply chain issue and can't get a critical part. Other manufacturer might be able to step in, but they're not participating in the EV rebate program so customers have to pay full price. And in this alternate reality those manufacturers probably don't make cheap or even mid-range EVs anyways because it's not profitable -- they can't compete with Nissan because they're at a $7500 price disadvantage, so they focus on selling cars for rich people. The Tesla Model S might exist, but the Model 3 probably wouldn't. A system of artificial and completely unnecessary monopoly would stop a whole competitive industry from forming.

diordiderot 4y ago
Who the hell thought that this system was a good idea? Is it corruption?
- elihu 4y ago
  It sure looks like regulatory capture to me (what better way for a major incumbent to establish an economic moat to prevent any competition in their market?), but it's possible that congresspeople legitimately thought it was a good idea at the time.