As far as new investments though, China arguably picks their winners and has learned valuable lessons in boosting manufacturing from garage to factory. Their lead in solar manufacturing was astronomical.
The US have also done this, look at how Boeing, HP, Intel, the Auto industry and others had their start. Lots and lots of loans and grants.
If anything our policies are overly conservative and careful with new investment, investing heavily in the "idea factory" models surrounding higher education and subsidiaries. Fortunately that's also led to a large and mostly competent investment community that is willing to bet the farm on new companies.
Comparing the industrial & investment growth to industry in Europe and the ME has informed my view that we do a pretty decent job. Corruption is there, but it isn't the norm that I've see in other parts of the world.
When China plays clear favorites with its companies, the US is forced to compete in tis unfair market.
This is especially relevant for industries that require such an extreme amount of capital to be bootstrapped, that it is essentially impossible for a competitor arise in the market fair and square.
Because "winners" in this sense right now just means "who can build it cheaper" -- and there's no intellectual bankruptcy there. The answer is pretty much always "K, build it cheaper? Build it somewhere else then."
It would be as if in the late 70s deciding we had to subsidize supercomputer and mainframe computer development, to hire all these talented engineers who were wasting time building and programming kit computers and “pc”s that could never be as important to our economy, and our “technological leadership”.
We can’t industrial plan the future.
The market doesn’t care if US democracy triumphs over (or even survives) Chinese state managed capitalism. But I think a lot of us have skin in the game on this one.
China has long recognized the strategic importance of this kind of thinking, see the massive subsidies they provide many of their industries to create the very dependencies you’re crediting as a natural market efficiency.