The Chinese approach to stimulus

The New York Times recently ran a story about China's dedication to building their electric car industry. 

http://www.nytimes.com/2009/04/02/business/global/02electric.html?_r=1&scp=1&sq=china%20electric&st=cse

This plan capitalizes on the best parts of a government stimulus package - giving smart loans and incentives to encourage the growth of a sector which will be increasingly vital to consumers of the future.  In the meantime, the U.S. approach to stimulus seems to be to throw money into companies whose business models have demonstrated essential flaws (GM, Chrysler, AIG).  Fortunately there are some American companies trying to adapt to the future.  Tesla Motors (founded by PayPal mogul Elon Musk) is attempting to grow into the first large-scale electric auto manufacturer in the U.S.  They are currently seeking a $350 million loan to launch their new Model S sedan. 

http://www.businessweek.com/bwdaily/dnflash/content/mar2009/db20090326_679423.htm?campaign_id=rss_daily

This is the kind of forward-thinking that American industry should seek to emulate if we hope to remain competitive with foreign manufacturing.  Korea, Japan, and China lead the world in battery manufacturing.  In the increasingly technology-dependent world, where everything from iPhones to cars run on batteries, the U.S. is already falling behind in battery production just as we fell behind in alternative energy.  Smart incentives, tax plans, and loan programs could take a forward-looking approach to addressing national problems rather than the crisis management approach we have seen so far.  Prevention is worth a pound of cure, and there's no point in locking the barn after horse is stolen.  If we succeed in weaning ourselves from foreign oil, let's make sure we don't exchange it for a dependency on foreign batteries.  As foreign governments lend increasing support to developing industries, our domestic counterparts risk falling behind without corresponding help.  Hopefully, the Obama stimulus will help address this shortfall of innovation in time to preserve America's place in the 21^st century. 

-Joel Poelhuis