A Better Place or Business As Usual?

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 Why should the government prop up what might very well be an outdated technology or an industry that time has passed by?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.

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5 Responses to A Better Place or Business As Usual?

  1. Alex Pietsch says:

    You mean, you are now a fan of something other than Seahawks and the City of Renton on Fb.

  2. We are very excited to bring the electric car infrastructure network to the United States and happy to announce California as our first state to do so! Follow us on Twitter @bpcommunity and checkout planet.betterplace.com to get the conversation started. We want to chat with you!

  3. billmcsherry says:

    Fair point, Mr Pietsch.

    But isn’t Renton considered Seahawks-related?

  4. Herb Pearse says:

    Hi Bill… I have always tried to take the simple approach to solving problems. Since our government is dancing around what to do about the current financial crisis, nothing is getting resolved except shoving some monies to those who are essentially the perpetrators of the problem.
    My suggestion for a simple fix:
    Have the Federal Government set an interest rate at 1 or 2% (or whatever will keep lending institutions operational / profitable without ripping off the borrower) above prime to allow a reasonable profit on lending money. Apply this interest rate limit retroactively to current debtors accounts and to future lending for mortgages, credit cards, and any monies in general that are loaned. Eliminate fees! Make Futures Trading, Hedge Funds, etc. illegal (the dramatic fluctuations in petroleum prices has proven how detrimental these activities are to the financial structure in general)!
    Now that we have leveled the playing field, businesses and consumers will now have access to money at a reasonable rate of interest which should greatly stimulate the economy and allow business to grow and hire.
    There is a down side… Upper echilon executives would have to rethink their exhorbitant compensation packages / benefits / golden parachutes, etc., and oh yes… how to fuel the corporate jets!!!
    !!!NO BAILOUTS!!!

  5. Sam Kaplan says:

    And you also meant besides the Trade Development Alliance Facebook page. All the cool cat kids are befriending it.

    BTW, I agree on rest of post. Subsidizing three automakers essentially means punishing all others, no matter how innovative, environmentally-friendly and economically sound

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