An going debate between Joseph and Mark

Mark and I have been discussing this post by Noah Smith.  I tend to agree a lot with Noah's points in the post, but I think it ignores the elephant in the room.  Consider this post by Matthew Yglesias:

There's lots of hypocrisy in politics all the time, but it's really amazing how quickly and ferociously all kinds of conservative views about the evils of central planning, government intervention in the economy, and industrial policy go out the window when the subject of fossil fuels. The very same people who'd bang the drums loudest about efforts to spur more advanced renewal energy technology think nothing of dumping billions of dollars in the laps of Shell Oil.

Modern industrial policy seems to be focused around encouraging and subsidizing the use of fossil fuels.  Why not simply adopt a neutral stance to the whole matter?  It would allow alternative energy to displace fossil fuels if and when a specific technology is efficient enough to do so.  Maybe it would let nuclear or hydro or solar energy generation compete on a more level footing.  It may be too late to stop global warming and I am in favor of searching for innovations to improve all aspects of the economy/society.

But do we really have to make subsidizing fossil fuel a policy objective?