The G-prize (as in, gimmicky)

Presidential candidate John McCain is offering $300 million to whoever can develop a better car battery “that has the size, capacity, cost and power to leapfrog the commercially available plug-in hybrids or electric cars.” His rival Barack Obama calls it a “gimmick.” I’m inclined to agree.

Prizes are all the rage these days, whether they’re for commercial space travel, decoding the human genome, or visiting the moon. People love the idea of these prizes because they imply the democratization of innovation, that some unsung inventor tinkering away in his garage somewhere holds the key to a problem that has befuddled government and the markets. In some cases, where the problems are very specific, that can be true. Netflix, the mail-order movie company, is offering $1 million to whoever can devise a better algorithm for predicting what movies customers might want to see. One of the top contenders is a retired English management consultant and amateur psychologist going by the handle “Just a guy in a garage.”

The problem is, McCain’s taxpayer-funded prize implies no one else is already working toward the goal of a production-ready, oil-less car. A quick tally reveals Toyota, Honda, GM and Ford alone will spend a combined $26 billion on research and development this year, with a growing chunk of that going to the production of market ready clean energy cars like GM’s Volt and Toyota’s plans to offer a plug-in hybrid by 2010. The fact is the potential market for such cars dwarfs McCain’s $300 million prize, and that is what will truly drive the development of a realistic alternative to the internal combustion engine.