The Marshall Policy Institute has released a new study weighing the costs and benefits of the U.S. government’s subsidization of the electric car.  Their damning analysis exposes the initiative as one which harms American producers, consumers, and taxpayers, all the while failing to substantially address the environmental issues at which it is aimed.

In 2010, one fourth of GM and Ford’s hybrids were purchased by the federal government.  Nissan got a $1.4 billion dollar loan from the feds to develop their electric car, the Leaf.  Several thousands of dollars in tax credits per car have to be shelled out to make these models saleable.  These and other measures, the Marshall paper notes, are spurred largely by the altruistic wish to save the environment, regardless of whether the cars have any real effect: 

“According to the Congressional Research Service (CRS), cars and other light duty vehicles accounted for 17% of U.S. emissions in 2007, which translates into about 4% of global emissions. Since electric vehicles will account for only a small percentage of the U.S. fleet anytime soon, under 5% until after 2020 or beyond, their impact on global emissions will be swamped by developing country emissions.”

Proponents of subsidizing electrics and hybrids cite lessening dependence on foreign oil and the creation of “green” jobs to support their position.  In reality, the facts are quite different.  The reduction of oil imports from increased usage of the cars is miniscule, especially when compared to a simple increase in domestic oil production and exploration, which the Obama administration has made a point of suppressing.  Additionally, the ill-defined “green” jobs created by production of these cars are far offset by the net waste of investment dollars that could have created far more of them elsewhere in the economy.  This is a no-win situation:

“If the rationale for promoting electric vehicles cannot withstand close scrutiny, it stands to reason that there is even less justification for the large subsidies that the government is providing to promote them. It also raises questions about the real motivation for electric vehicles being such a high government priority. It is not coincidental that the Obama Administration has demonstrated a strong “off-oil” bias.”

Although the Marshall Institute’s study doesn’t touch on the question, it is important to note that the feds have no business promoting one product over another in the first place.  Even if it were constitutionally proper, it makes little sense to experimentally sabotage the American auto market at a time when our economy is still struggling to get back on its feet.  Who wants the same people who gave us a $13.8 trillion deficit meddling with our cars?

In the end, the success of a product will always be determined by one thing: whether it works.  Many politicians, however, will always use another metric: whether it makes them look good.  If we take the electric car off of welfare and let private enterprises do their work, there can be no question that a future Henry Ford will make it a resounding success.  Not with subsidies, not with tax-dollars, and not with politics.  You know, the way American innovation used to be.