Taxing and spending: it’s good for business!

As an Obama-era Gordon Gekko might put it to shocking effect: “Government spending is good.”

The enormous “government handout” that is the stimulus package is encouraging growth of emerging industries and doing so partly by bringing major private-sector investors on board. The development puts the lie to the simple dichotomy drawn in the last few decades between the market and the government and to pretend incompatibility of the two. Unabashed taxing and spending is looking pretty good for business — and not just the businesses in need of bailout. The stimulus is stimulating major U.S. companies to actually make things and build industries that will pay dividends well into the future.

Look at a short list of the companies committing significant investments in the smart-grid sector, all of them expecting large returns: IBM, GE, AT&T, Cisco, Intel, T-Mobile, Microsoft, and Google.

That’s not a fringe lineup. And some of the sums involved are as large as the business plans are ambitious. Spurred by the commitment of the Obama administration, which has skin in the game equaling $4.5 billion in smart-grid funding, IBM has put aside $2 billion to fund smart-grid startups and utilities, looking to tap the growing $13 billion market in smart-meter components.

Camille Ricketts at Venture Beat provides a roundup of recent activity:

IBM has struck a $3.2 million deal to provide 12,000 sensors (which send information from various appliances and devices to meters) for smart grid development in Australia.

In March, AT&T solidified its partnership with smart meter provider SmartSynch, granting the startup access to its wireless network for communication between 10,000 household meters and local utilities.

Verizon has joined forces with Ambient, a close competitor of Silver Spring Networks, which has landed the business of major utilities like PG&E and Florida Power & Light.

Google recently announced its home energy monitoring system PowerMeter. The company says this tool will allow homeowners to see how much energy they are using, and how much it is costing them, from their computers in real time… it’s perhaps the most salient example of a company with few ties to the space attempting to establish dominance before the stimulus funds work their magic.

Intel Capital is working on interfaces for delivering energy consumption data to utilities and consumers alike — anticipating the ability to present this information on people’s living room television screens. … [I]t has also expressed interest in smart buildings, but is perhaps most interested in influencing policy and developing smart grid standards that will effect the entire ecosystem of companies working in the area…

Investment writer Eugene Bukoveczky says General Electric execs expect the company’s smart-grid monitoring business to grow by $3 billion to $4 billion a year over the next three to four years.

The era of “greed is good” mad money may at last be over — or at least cycled out. Bukoveczky says patient investors in the smart-grid sector will be rewarded handsomely in the years and decades to come, providing what sounds like new investment advice to match a new political era.

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