USA can dominate the Bitcoin Beanie Babies scene tomorrow... They just have to shift a small percentage of their war funding to Bitcoin mining Beanie Babies production and focus Silicon valley
development onASIC chip Beanie Babies manufacturing and they can dominate the scene. You chose your own battles... 
development on
FTFY. US government is not going to subsidize electricity to make a few guys rich when they turn it back into heat
They don't need to subsidize anything. Just sell superior hardware. Those that have access to cheap electricity will figure out the rest.
So this superior hardware will go to China? How will this affect centralization??
If shovels are made in New York, would you pan for gold in Manhattan?
We don't have to theorize on what would happen. GPU mining, for example, never became centralized in China despite the lower electric costs there.
Of course we have to theorize, otherwise this is a pointless conversation.
GPU mining was never centralized in China because Bitcoin's market cap was laughably small, because the power consumed was a fraction of the rig's cost, because people mining were weirdo hobbyists like me, who ran FurMark as an alternative, and because buying BTC directly was always more profitable.
Please.
1. GPU mining for bitcoins is alive and well. But it has to be done indirectly, through altcoins. GPU =>altcoin=>bitcoin, voila!
2. GPU miners are different than ASIC miners in that you can resell the hardware (PCs, CPUs, RAMs + the GPUs themselves) after a few years and get something back or even repurpose the systems for something else. It has even less CAPEX if you start with used hardware. Obviously, buying older GPU hardware is not the same in terms of speed and power efficiency but people with subsidized power wouldn't care that much, would they? (Kind of like saying that no matter how slow the mining hardware is, it can still be profitable with extremely cheap or free electricity)
Still, it ain't happening (China centralization of GPUs).
What the west lacks, is access to cheap and fast ASIC equipment. There are people who can run mining hardware for free (flat electricity bill) or very cheaply for various reasons related to their power setup, location, etc etc, yet they don't have access to cheap and fast ASICs. Theoretically they can use older hardware and still be profitable, but in the grander scheme of things, they will not represent a significant percentage of the hashrate pie while using outdated hardware. The situation would be different if there was cheap access to efficient ASIC hardware for westerners, provided by western chip industries. The situation where mining companies keep their miners for themselves and simply create farms, or sell to outsiders with very big profits, is creating mining asymmetries.