I don't think any government anywhere has ever been shamed into stopping playing with a marked deck but aside from that I think [read: hope] you are mostly right.
The news that KIOR (backed by Bill Gates and Vinod Khosla) may file for bankruptcy is certainly not good for future investments into cellulosic ethanol projects.
I wonder why it's taking BFRE so long to release any updates to its shareholders regarding the progress. Waiting for the 10-Q