Solyndra, a manufacturer of solar panels, is bankrupt, which is inconvenient for the Obama administration, which extended half a billion dollars’ worth of loan guarantees to the firm as part of the president’s stimulus effort. The inconvenience extends to the 1,100 Solyndra employees who have just lost their jobs and to the U.S. taxpayers who may be on the hook for the bankrupt firm’s loans. The project was indeed “shovel ready,” as the president likes to put it; unhappily, in this case, the shovel belongs to the gravedigger. Perhaps the gravestone could read: “Another project funded by the American Recovery and Reinvestment Act.”
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Solyndra was an irrestibly juicy piece of bait for stimulus-happy progressives. President Obama, like all Democrats, labors under a special challenge when it comes to economic affairs: His economically illiterate base spends its time decrying “corporations,” but urban-gardening cooperatives don’t create a lot of jobs, and community-based nonprofits by definition don’t create any profit, and therefore no investment capital, and therefore no economic growth. You want to see some real, sustainable, long-term jobs created, your best bet is to look to a “corporation”—“corporation” simply being the word for a business that has grown large enough or profitable enough to require the legal organization of its affairs. But if you’re Barack Obama, not just any corporation will do: It has to be just the right sort of corporation.
And boy, was Solyndra just right: It made solar panels, a product so green that Democrats could almost forget that this was a profit-oriented corporation, backed by venture capitalists, oil money, and private-equity funds, and led by a former Intel executive. The firm was in Nancy Pelosi’s back yard, and it was looking to expand, with plans to build a factory for the mass production of its photovoltaic cells. But the firm was not thriving, and those venture capitalists were not eager to put their own money on the line for that new facility. So they put your money on the line, instead.
The Government Accountability Office would later single out the Solyndra deal as an example of the government’s failing to fully vet such arrangements before approving the loan guarantees. With all those stimulus dollars burning a hole in its pocket, the Obama administration was overeager to get them spent. “If you don’t have really strong processes in place, and if you’re under pressure to get a lot of these dollars allocated, you can make unproductive decisions and ones that ultimately put taxpayers’ dollars at risk,” GAO analyst Franklin Rusco said. In fact, the administration announced its commitment to the loan guarantees before the required outside reviews were even in hand.
And as those who have followed the machinations of T. Boone Pickens know, when there’s a green-energy plan looking for a federal backstop, there’s an Oklahoma oil man behind the curtain. In the case of Solyndra it was billionaire George Kaiser, a Democratic donation bundler and a major financial supporter of Barack Obama’s 2008 campaign. Mr. Kaiser was heavily invested in the firm. Other Democratic bundlers received similarly generous treatment under the guise of green jobs, stimulus, and other expressions of President Obama’s magical thinking. It’s easy to spend several hundred billion dollars of somebody else’s money in a hurry; it’s hard to spend it well or wisely.
So, the indictment reads: wasteful, inefficient, non-transparent, irregular, unseemly, and, finally, bankrupt. The thousands of jobs the Solyndra project was supposed to create have not appeared, and more than a thousand jobs have just disappeared. The president is planning a big speech about jobs, and perhaps he’s had enough law-school Latin to know what mea culpa means.
Just a reminder:
'Barack Obama and Joe Biden have a comprehensive plan to invest in alternative and renewable energy, end our addiction to foreign oil, address the global climate crisis and create millions of new jobs."
I now have Mark Steyn's view of America, "This place is dead man walking."
So, not too much upsets me about the US government.
Here are some facts of life to chew on: The USA has four successful jet fighter programs since 1963. 4. That's it. 4.
Obama threw money at some "green" company and missed the gangrene in the company's balance sheet. Well, Obama meant well. So did Bush II, so did Clinton, so did Bush, so did Reagan, and so did Carter. Ford was not really around that much to get involved with private business. Nixon was too much of a moderate giving liberals everthing they wanted to really mean well.
All things pass. So what if Obama blew the background investigation of a balance sheet?
The nation is dying and we know it. Ask any US military member and - if they spend any time next to a foreign army - they will tell you a nation that lets openly gay members serve in the ranks that that nation's military become ineffective very fast. And it becomes a laughing stock to other nations' military.
So what if Obama can't pick and chose winning businesses. He chose GE and they are doing a fantastic job of money laundering Federal Dollars to his political campaigns. Obama has wrecked the US Space program. Obama has poisoned the US military. Obama is killing the US health care system.
Who cares about some California business which supported the policies that have turned America terminal?
"...an example of the government’s failing to fully vet such arrangements before approving the loan guarantees. With all those its pocket, the Obama administration was overeager to get them spent."
Hmmmm... Sounds eerily familiar, perhaps like banks with dollars burning holes in their pockets due to federal pressure to make loans to unvetted would-be home owners.
As always follow the money. Only in this case, follow the money not just from Obama to Kaiser, but now look to see how much of the half billion dollars are flowing in some form back to Obama, or his minions. If Acorn were still around, I check there first.
I'll bet also that an Acorn by any other name is still an Acorn.
Can't wait until the unions finish the fleecing of GM and Chrysler in contract talks.
The question remains whether the bailout of the auto industry will have different results than funding the green energy industries has had for Solyndra?
Why is not someone investigating this fiasco? In my life, someone would be facing jail time. But times have changed. So has the value of the American Dollar.
"In the case of Solyndra it was billionaire George Kaiser, a Democratic donation bundler and a major financial supporter of Barack Obama’s 2008 campaign."
The single most damning statement in this sorry story. Corruption is, by definition, using public money to benefit yourself or your friends.
Half a billion--who cares? This is a one day, page 16 story.
What I'd be interested in knowing is how Kaiser's investment in the firm is structured. Is it in the form of a loan or preferred stock that the taxpapers are on the hook for bailing out? If so, I think we're entering impeachment territory.
The president is following his road map. This is not the result of an incompetent president. This is his mission. The transformation and destruction of the U.S.A.
great, lets cheer the downfall of another home grown american company. instead of turning this article into a political piece meant to add another one to the pile of arguments against green jobs, perhaps you should look to real reasons why the company failed. Solar in general is a volatile market and a hard one at that.
The marketplace is unemotional. The marketplace rewards those who provide value and destroys those who don't, but its not personal. Its not emotional. Its just ruthless and efficient.
And that's precisely what is wrong with this sort of subsidy. It is made for emotional reasons. The atmospherics around Solyndra were every Leftist's dream. It was irresistible.
But that didn't make it a good investment. In fact, it was obviously a bad investment. Anyone could have seen it. How? By the fact that real people (even dedicated Leftists) were declining to put any more of their own money at risk.
This whole thing reminds me of the dot-com bubble from 10+ years ago. Back then, the idea was to build something, anything, that would get investor attention. Profits? Cash flow? Assets? That was "Economy 1.0" thinking, and this is an "Economy 2.0" world, right? Anything to get some publicity and attract the next wave of investors (ie, the "greater fools") to buy out the first wave of investors.
Solyndra was the same thing, only in this case the "greater fools" was the Obama administration....and ultimately all of us.
Governments should not subsidize businesses. There is no authority under the Constitution for the feds to do that. Even if it were allowed, it is foolish to entrust resource allocation to politicians and bureaucrats. Leave it to people who are dealing with their own money.
Whoever Obama's opponent is, he or she should pledge to end crony capitalism by vetoing any bill that contains business subsidies.
"Theory #5 – It has never been profitable from day 1.
I would personally bet on this theory. The Company talks about $100 million in sales in 2009 and $140 million in 2010. There is no mention of “profit”. If it costs $120 million to generate a $100 million in sales, you are not profitable. Being profitable means you have a positive cash flow. Companies that only talk about revenues usually have negative cash flows. Negative cash flows mean you’re going to go out of business eventually. Further support of this theory is the fact that they needed a government guarantee to secure the $½ billion loan they received. If the Company was cash flow positive and showing signs of success, investors would have been lining up at the door to invest, government guarantee or not."
Next time, maybe you should read all the way to the end of what you link, as it comes to THE SAME CONCLUSION AS NRO's EDITORS.
