todays news article

bgarrett

http://www.futurepundit.com/archives/006435.html

BB.

Re: todays news article

And I will argue that the author's thoughts (from comment section):

I'm coming around to Engineer-Poet's argument that subsidies for deployment will bring down costs faster than subsidies for research. He's been telling me that for maybe 5 years. I think he's right.

... is subsidies for deployment artificially "jack up the price"--with virtually all of the subside going into the pocket of the industry. Giving them little incentive to reduce prices below enduser retail+government pricing.

Whether it is solar or cars--when the subsidies go away, the enduser is still paying, roughly, the same retail price (and high cost/poor quality vendors disappear). The government section just ends up being welfare for industry.

Sure--there may be some slight benefits from government subsidies (new, more efficient factory, some investments in R&D, etc.)--but those "benefits" are probably in the single digit percent range--meaning that over 90% of the government cash was just a transfer payment from tax and rate payers to industry.

And, it may well have served to subsidies the less efficient factory, process, vendor and served as a disincentive for private investment because there is already money being made (with 30-50+% subsidies)--and given that subsidies are typically only known/guaranteed one year out--there is little future market understanding; again adding to resistance of future capital investments (and product/pricing improvements) because the "market" can dry up tomorrow if government policies change.

-Bill