About computing capacity: Maybe free market capacity scales exponentially (with the number of actors?) but I don't see how it could. If an economy of n actors has a "capacity" of e^n, the average capacity of an actor would be e^n/n, which is about the same as e^n. How could an individual actor have such capacity? Perhaps my analysis here is mistaken.
Regarding government intervention, let's look at an extreme example. Do you think that, during World War II, the U.S. should have structured its wartime economy around free market principles? Did it make things worse by not doing so?
About government planning for the future: First of all, social security gets gutted because the U.S. government is not a government of the people. Business interests have too much control (that is, more than no control at all.) You also say governments are shortsighted because of elections. Even if this is the case, this is not a necessary part of government. The governance model described in the book I linked is based on sortition rather than election. China's current system, while authoritarian, is also able to plan for the future.
It seems you agree that China investing in solar power is beneficial to it, even if you disagree on the reason. So you agree that, all else being equal, it is better for China to have invested in solar power than to not have done so. In this case, this is a clear example of a government acting in the market with a good outcome. This contradicts your previous point.