“Government can efficiently affect energy usage through fuel taxes and basic research. When it intervenes on behalf of specific technologies and specific companies, however, bad things happen — resource misallocation, windfall-seeking, even, sometimes, corruption. The Fisker debacle proves once again that, in the immortal words of former White House economist Larry Summers, ‘government is a crappy VC’.”
“Government can efficiently affect energy usage through fuel taxes and basic research.” Well, perhaps they can. By their track record, though, they don’t.
Fisker is an excellent example of how, when the government tries to pick winners and losers in business, it winds up picking losers. Fisker might have succeeded if they had had to work without subsidies; maybe even the Volt would. As soon as you get government tampering, though, you lose the vital effect of the market.