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Drew Bixby

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Tesla was blocked from selling cars in Texas. Is this a bad sign?

In the book Why Nations Fail, (http://whynationsfail.com/) the authors argue that inclusiveness is what made the US great and extractive-ness is what makes nations like Venezuela fail. Very generally, inclusiveness means everyone has an equal opportunity to compete and the laws support such an environment. In contrast, extractive-ness is an environment where rules, over-regulation, political favors, and financial weight give preference to certain groups over others.

This case with Tesla seems very "extractive"/non-iinclusive by their definition. Is this just isolated or is this a bad sign for the state of things in the US?

In case you are not aware, here is a brief synopsis of the Tesla case:
http://www.autoweek.com/article/20130604/green/130609929

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    Jun 17 2013: Drew, Every article I read on this causes me to read another. It seems that Telsa is asking for exception to the law that all autos must be sold through a dealer to avoid tax and franchise laws. However if that is true it would just be a matter of the state saying no ... the law suits are being filed by the auto dealers. Why would they file a suit if the law was on their side and it being illegal to not sell through a dealer.

    As I read I saw that many other states are involved not just Texas.

    When I rotated back to the states one of the big thing in the military was the offer to buy autos direct from the manufacturer and go there to pick them up. My question is ... wouldn't that be about the same thing. The dealers in the state are left out ... state franchise and tax laws would have been bypassed ... why didn't the dealers sue over that program.

    I can see this going to the high court soon ... more federal intervention as if we need more federal control.

    Everytime I read a article on this I have more questions .... any way to clear this up for the non lawyer?

    Thanks. Bob.
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      Jun 17 2013: Bob, I also took advantage of the program for the military in Europe. AAFES was actually the dealer for paperwork and instead of hiring people to have a dealership, You did that part of the job for them. And you probably never read the local papers to hear the local dealers cursing AAFES. The power of status of forces agreements. That's another conversation.

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