Monday, December 14, 2009
Department of Energy as Venture Capitalist
This WSj article, reports on a $13 billion gusher from the Department of Energy to fund 'Cleantech' start ups. Unfortunately, what appears to be happening is the emergence of an industry designed to maximize the acquisition of government handouts. Whenever massive amounts of money are poured into a economy, distortions in incentives and risk preceptions will occur. One does not have to look further than the corn-based ethanol fiasco of 2008. Why is private venture capital funding for Cleantech only 1/5 of the DOE's? Could it be that the market knows something the government does not?
at 6:31 PM