Yesterday I became a fan of my first non-Seahawks related Facebook page. Better Place is a company that is looking to develop and implement a network of electric cars, through a subscription-based model. The way it works is you buy a 100% electric car, then subscribe to the Better Place service, which takes care of your battery and all the electricity your car uses, and you’re billed monthly. Basically, it’s a car that you pay for like a cell phone, and you never use gas. Israel and Denmark have already signed up to deploy the technology, and Renault-Nissan is building the cars you’ll be able to buy to use the service. Oh, and California just joined up too.
So, it is with more than my usual skepticism that I read about the desired government “bailouts” the US car makers are hoping to secure. Why should the government prop up what might very well be an outdated technology or an industry that time has passed by? Isn’t one of the fundamental rules of economics that capital and resources should flow to those who can most efficiently manage that investment?
Why should the government be bailing out car makers?
If they don’t, wouldn’t that free up a ton of production capacity to allow innovative companies like Better Place and its partners to deploy those resources in a manner that achieves greater utility? Or more simply put – wouldn’t it allow them to make stuff people want to buy?
That’s the whole point of Creative Destruction, isn’t it? (Yes is the answer to that question, BTW)
Let the failures fail – if that is indeed what will happen without massive infusions of government money – and then let the vultures come in, pick apart the wreckage and get back to work. That’s how it’s supposed to work. Otherwise, the only thing we’re bailing ourselves out of is future prosperity.
UPDATED 12-3-2008 10:58pm. I got tired of the auto-play video and replaced it with a picture.