Has there ever been a better case for markets?
At the Detroit Auto Show this week, Big Auto is lobbying hard for electric cars as the future of transportation with government being eyed to subsidize battery development. Shai Agassi, the founder of Better Place, is also in Detroit promoting electrics — but on the business model of cell phones, where government would help build a recharging infrastructure. Meanwhile, as colleague Pollowitz notes nearby, T. Boone Pickens is proposing “that Congress mandate that all new fleet vehicles run on natural gas.” Those who don’t support his plan are “unpatriotic.” And — when he’s not sinking capital into electrics — GM CEO Rick Wagoner is also investing in ethanol-powered cars with calls for government to build an ethanol-fueling infrastructure. He has found allies in California venture capitalists on the Left and national-security pundits on the Right, who want to mandate that all cars be capable of running on gas or biofuels. Meanwhile, Drew Thornley notes below the ethanol industry’s sensitivity to both oil and corn prices.
All these interests have millions to burn and have deployed armies of lobbyists in Washington to convince Congress that their technology is the most deserving. But politicians are not equipped to pick the most viable transportation fuel.
There is one solution. Let the market decide.