When it comes to spending government money in the private sphere, China is second to none. Now, the country is doubling down on subsidies for the production of electric vehicles (E.V.s). The U.S. should make sure not to follow suit.
As Yoko Kubota and Clarence Leong wrote in The Wall Street Journal this week, China is "encouraging unprofitable carmakers to keep producing as officials try to boost economic growth, preserve jobs and expand China's role in the global electric-vehicle business." The authors detail Zhido, a shuttered Chinese E.V. manufacturer that has reentered the market. "State-backed funds and dozens of other investors pumped fresh capital into the company late last year—despite widespread signs that China has too many carmakers to serve its needs."
