It’s correct to subsidize electric cars
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It’s correct to subsidize electric cars

Gov. Walz says we need to have legislation for the future of electric cars because we need to be ‘where the puck is going to be’. One of my basic principles on business is that capitalism works best when the technology and economics works is a good time for progress.

When the technology and economics were there, the government did a lot to promote the use of ethanol, including subsidizing the ethanol industry. So there are times that government intrusion has helped a new worthwhile industry.

But where is the puck now? An old lady gave me a ride in her electric car at least five years ago and I was impressed with how easily she could speed up in city traffic to pass another vehicle. So, I have done a little research on where the puck is.

You can drive 100 miles on $3 of electricity. That is farther than your gas car at $3 gas.

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There are new electric cars in the $30,000 price range. So the economics is there. Since there are not many filling stations yet, you would have to use your electric vehicle for short trips. This would make your gas vehicle last far longer because a gas engine needs to be warmed up to run efficiently and not wear out so fast.

So you could keep your minivan for family vacations and drive cheap around town. The electric cars that I checked on had a battery capacity of 40 and 62 kilowatt hours. Since the smallest circuit breaker in your house is 10 kilowatts, if your last short trip around town was finished by 11 p.m., your car could be fully charged by six in the morning.

To be where the puck is might mean that we start buying electric cars now so that the puck does not hit us in the ankles. It is just as correct to subsidize electric cars now as it was to help ethanol get started. According to economic theory, a subsidy is only good for a viable new industry, but then it is no longer good capitalism to continue the subsidy once the industry is up and running.

Roger L. Elgersma