Seems more like a problem of US companies being allowed to continue to stall for too long, often due to lobbying and political points, without measurable improvement than the subsidies.
Meanwhile China subsidizes much of their R&D and everyone is astounded at how fast they've improved. Sounds like they're just better at doing it.
The US government isn't going to exert that level of influence on a private enterprise without being a majority shareholder, which is what happened with GM in the 2008 bailout.
The government also can't be in a position where pulling billions in funding based on targets it sets leads to mass layoffs, that would be a political minefield come election time. Subsidies are about creating jobs as much as they are about enabling technology development.
The modern EV was born from Californian regulation but that early lead has been squandered.