Should the government be picking technologies?

I don't think so, but it's an interesting dilemma we're in. I also don't think that's what they are up to.  They are mostly funding the R in R+D.  VC' s and other investors rarely fund anything like this which could be one reason we haven't seen enough innovation in renewables.  

A new energy initiative, modeled after the department of defense funding, is "investing" (although it's not clear if taxpayers see the return) in new clean tech mostly in the fuel space.)  

This industry needed to grow and scale 30 years ago, but the question is can it now?  VC's and other early stage investors are hesitant to invest so how do we make this happen without government?  Well, this is a government solution that could have some legs.  They shouldn't be the ones loaning the A123-type companies money to build a new plant there's a conflict of interest and inexperience there but the government should definitely be there to fund the research for the entrepreneurs that can create the next A123. 

This $400 million is pennies compared to the $13 Trillion in national debt but it might just end up helping drive our future economic growth.  

http://www.nytimes.com/2010/08/19/business/energy-environment/19fuel.html?pagewanted=1&hpw