Subsidies Keep America on Top

Froma Harrop on Apr 14, 2026

That $7,500 tax credit to buy an electric vehicle, now gone, was a "grotesque misallocation of federal spending." It was a form of "rent-seeking," whereby companies seek "to dominate the bureaucracy instead of the marketplace."

Thus wrote Kyle Smith in a Wall Street Journal column titled "EVs Can't Compete Without Subsidies." Smith deserves the Pulitzer for Clueless Commentary, a competitive category. About six weeks earlier, Trump launched a war on Iran paid for -- subsidized! -- by the American taxpayers. Some of it was to obliterate Iran's nuclear program, a worthy goal. But it was also about oil, hence, the ongoing struggle to keep the Strait of Hormuz open for tankers.

Let's talk about carmakers and subsidies. In 1908, when Henry Ford's Model T first rolled off the assembly line, 93% of America's rural public roads lacked any kind of surfacing. Until decent roads could permit town-to-town car travel, the market for Ford's new product would be largely limited to well-to-do city folk seeking a new plaything.

The fledgling car industry clearly needed good roads to prosper. Several industry leaders proposed pooling their resources to privately build some kind of national highway system. Not Henry Ford. Government should pay for it, he said. And Ford became a major force in the Good Roads Movement, which pushed for greater government involvement. It achieved ultimate victory with the Federal Highway Act of 1921.

This was classic "rent-seeking," to use Smith's dismissive term, that is, getting the government rather than the marketplace to advance an industry's interests. In 2023 alone, U.S. taxpayers spent about $285 billion building, maintaining and policing roads. But rent-seeking can also lead to good results for the nation at large. The modern road system helped America prosper into the 20th century and beyond.

And what do electric vehicle makers need from government? Not roads. The existing roads do just fine. They need something that costs considerably less than a network of interstates.

Many would-be customers for EVs worry that they'd be on a long trip with nowhere to charge their vehicles. The Biden administration tried to address that concern by budgeting a mere $8 billion to build a coast-to-coast system of charging stations along said interstates.

Trump tried to kill it. He froze the charger-station plan, miring much of it in litigation. He launched a smear campaign against EVs. Many MAGA devotees followed him in mocking them. Candidates campaigned against EVs as a "hoax."

Governmental sabotage and a drop in gasoline prices devastated U.S. efforts to adopt the technology the rest of the world was running toward. Ford stopped making its all-electric Ford F-150 Lightning last year.

Consider this: The owner of an electric Tesla Model Y can drive 100 miles for less than $5. With pump prices of $4 a gallon (they're $6 in California), a comparable compact SUV, the 2025 Toyota RAV4, costs more than twice as much, $10.40, to go that distance. And it's a hybrid.

Meanwhile, at today's gas prices, the driver of Ford's gas-powered F-150 may have to shell out $20 to travel the same 100 miles.

Where's China in all this? Mostly watching as high gas prices strain the U.S. economy -- and not minding it one bit. For over a decade, China has devoted massive resources to reducing its need for imported oil, while becoming the world's biggest maker of EVs. (China now has charging stations that can "refill" a car in five minutes.)

With gas prices spiking, Americans are again looking at EVs -- just as discouraged American carmakers had largely given up on them. We're losing.

What were EV subsidies subsidizing? They were subsidizing our economy, our national security and our future.

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Follow Froma Harrop on Twitter @FromaHarrop. She can be reached at fharrop@gmail.com. To find out more about Froma Harrop and read features by other Creators writers and cartoonists, visit the Creators webpage at www.creators.com.

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