Like a lot of Republicans, New Jersey Gov. Chris Christie likes to talk about how the government should get out of the way of the free market. In a speech last week in Washington, D.C., he railed against President Obama’s economic interventions. “We don’t have an income inequality problem, we have an opportunity problem in this country because government’s trying to control the free market,” he said. And he urged his fellow conservatives to shout their opposition to government regulations from the rooftops. “We need to talk about the fact that we’re for a free-market society that allows your effort and your ingenuity to determine your success, not the cold, hard hand of government determining winners and losers.”
Then Christie came back to New Jersey and signed off on a cold, hard government regulation that blocks Tesla from selling its cars in the state.
The rule change prohibits automakers from selling directly to consumers, as Tesla does. Instead, it requires them to go through franchised, third-party dealerships, as the big, traditional car companies do. In other words, it requires that the middle-men get their cut. The Christie Administration made the move unilaterally, via the New Jersey Motor Vehicle Commission. It was urged on by lobbyists for the state’s existing car dealerships, which fear the competition. The upshot is that Tesla will be forced to stop selling cars at its two existing dealerships in the state, and drop its plans to build more. It’s unclear what will happen to the employees of those dealerships.
New Jersey is the third state to effectively block Tesla by banning automakers from selling their cars directly. The other two are Texas and Arizona.
In a blog post, Tesla blasted the Christie administration for enacting the rule change administratively, rather than waiting for the legislature to resolve the ambiguity in existing law. A spokesman for Christie, on the other hand, told me the governor views the new rule not as a policy change so much as a clarification of the status quo for car sales in the state.