Last week, the House Energy and Commerce Subcommittee on Oversight and Investigations heard testimony from top Treasury officials regarding the department’s role in the Solyndra loan scandal. More hearings are planned as investigators continue to shift through documents provided (reluctantly) by the Obama administration.
The most notable piece of evidence unveiled last week was a memo authored by the DOE legal counsel defending the controversial decision to prioritize private inventors ahead of taxpayers with respect to the first $75 million recovered in Solyndra’s liquidation. But while it sheds some light on DOE’s dubious rationale in this case, the revelation appears to raise more questions than it answers. Here is a look at a few of the questions Republican investigators will hope to answer in the coming weeks and months:
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Who was involved in the decision to restructure Solyndra’s loan agreement? At a previous committee hearing, Jonathan Silver, the former head of the DOE loans programs, told members under oath that he would provide them with a list of all the individuals involved in the decision to subordinate taxpayers in the restructuring agreement. Silver has since resigned. The committee is still interested in speaking to the people involved in the decision, particularly Susan Richardson, the chief counsel of the loans program who wrote the authorizing memo.
Energy secretary Steven Chu has already assumed responsibility for approving the restructuring agreement, and the committee certainly hopes to hear from him at some point as well. The most pressing question, though, remains the extent to which the White House was involved in the decision. E-mail evidence already suggests the White House was rather aggressive in pressuring the Office of Management and Budget to rush its approval of Solyndra’s initial $535 million loan guarantee. Given President Obama’s connections to George Kaiser, the Oklahoma billionaire whose family foundation (through investment arm Argonaut Ventures) was one of the private investors receiving preferential treatment in the loan restructuring — not to mention the political capital Obama himself had invested by making Solyndra a “green jobs” posterchild — it is certainly reasonable to ask whether the White House exerted any undue pressure on DOE officials. An e-mail among Treasury staff on Aug. 28, 2011, just days before Solyndra filed for bankruptcy, paints a disturbing picture:
I think DOE should be thinking through whether the proposed deal is just giving the investors more time to extract more value from the firm before bankruptcy . . . in which case it’s clearly in the investors’ interest regardless of the firm’s prospects.
Which brings us to the next question.
Why did DOE repeatedly ignore concerns from Treasury and OMB regarding the legality of the loan restructuring? As early as December 2010, just as DOE was entering negotiations to restructure Solyndra’s loan agreement, senior OMB officials were questioning the legality of the decision to subordinate taxpayers to private investors. The Energy Policy Act of 2005 stipulates that loan guarantees approved by DOE “shall be subject to the condition that the obligation is not subordinate to other financing.” In other words, the taxpayer comes first. In an e-mail dated Dec. 15, 2010, a senior OMB official raised doubts about DOE’s creative interpretation of the statute. “I think they have stretched this definition beyond its limits,” the official wrote.
Solyndra's plight warns that we can go bankrupt assuring the solar industry's success. The problem: Solar power for general use collides against the law of physics; and there is nothing anyone can do about it. Ever! Look at the electric car. The first electric car could travel about 40 miles on a full battery charge. After billions of dollars of research into high-tech batteries at our greatest science institutes, our new electric car can travel...40 miles between long recharges. There is only so much energy that can be crammed into a limited-sized battery. The laws of physics will not bend to our desire for sustainable energy.
The lesson of Solyndra is simple: We should not double down on ignorance and graft and end all government subsidies for "sustainable energy."
The real scandal isn't that the Obama administration gave the loan guarantee to Solyndra just in time for the the American taxpayer to be on the hook for the loan now that they are declaring bankruptcy. The real scandal is that the whole Federal government is a Solyndra. It is kept afloat only by loans from China. It is poorly run and in the red every day. It's products are too expensive. It wastes money like crazy on new buildings when there is a glut of old buildings which would work quite well. It's not the Federal government which should be investigating Solyndra, it's the American taxpayer which should be investigating the entire Federal government.
I would like to see what connection there is between the Solondra executives and investors in the now defunked CCX (Chicago Climate Exchange).
Through the implementation of cap and trade, several people would see their electricity and energy rates "necessarily skyrocket" according to president Obama. Through this legislation is was hopped that millions of people would switch to solar and thereby help companies like Solyndra increase sales, And indirectly their investors would make "billion" in profis from the transactions that would go through CCX. Investors like Goldman Sacks , Al Gore, Valerie Jarrett, and the President himself would indirectly benfit based of his initial involvement with the establishment of the CCX.
But once cap and trade didn't pass, everything started to unravel. CCX Disbanded and now Solyndra (without the big stick of Cap and trade) didn't have a way to "force' sales. So to protect selected investors, the government subordinates our financial position to private investors. Wounder who they are and were their webs connect?
It appears that many of the "green Jobs" are connected to people who are "big donners" to the democratic party or are related to government officials. Like the new one in
California where with the government loan (related to a sitting congressman in California) will help by increasing jobs in Mexico to make solar panels.
This whole thing is a mess and such a waist of our money. It appears there are a lot of big hands in the cookie jar and criminality is in the air!! Or is that just global warming?
This Solyndra debacle gives evidence that we can go bankrupt assuring the solar industry's success. The problem: Solar power for general use collides against the law of physics; and there is nothing anyone can do about it. Ever! Look at the electric car. The first electric car could travel about 40 miles on a full battery charge. After billions of dollars of research into high-tech batteries at our greatest science institutes, our new electric car can travel...40 miles between long recharges. There is only so much energy that can be crammed into a limited-sized battery. The laws of physics will not bend to our desire for sustainable energy.
The lesson of Solyndra is simple: We should not double down on ignorance and graft and end all government subsidies for "sustainable energy."
despite the media pig pile on the Solyndra story, nobody cares.
Compared to the bank and Big Auto bailouts, compared to the continuing enormous imbedded subsidies to Big Oil, government run electrical grids, and government supported nuclear power, and compared to the everyday waste of your average military subcontractor, Solyndra is chump change.
nobody cares. there is no heat here. move on folks, especially you media gawkers and professional scolds.
Hey kids...now now. The POINT I WAS TRYING TO MAKE is just that ....nobody cares. This is a relativistic analysis, but not in the way that you squinty sweat hogs are inferring.
The G has forever made policy decision based on the perceived utility of "official" advocacy of various resources that can be used for the public good. The G has backed, with taxpayer money and soldiers, laws, and sometimes with the heavy hand of confiscatory regulation, everything from railroad expansion to extraction of strategic resources from public lands, to the Internet, so forth. This is not "socialism", but is a legitimate role the G has to help introduce usable technology before general market acceptance or commercial feasibility allows for private companies to work a frontier type market. Think rural electrification here.
The point is that there are good legitimate policy goals that translate into grants, subsidies, tax policy, loans, and the regular flow of government funds into projects of all sorts. This is sometimes referred to as pork barrel spending, but a lot of stuff we needs gets built because the G promotes concepts and actual projects.
Energy independence using wind, solar energy, nuclear power, increase access to public lands for drilling, all entail direct and indirect government subsidies to different companies and agencies. There is nothing wrong with the G promoting what is touted as an important economic sector. Just ask the GM board of directors how much they love public bailouts.
This all requires some oversight to police fraud or malfeasance in granting contracts and giving grants and loans. Round up the wrongdoers and throw them in jail, fine. But don't overplay your hand here about Solyndra. In this climate a lot of companies that receive government money are going under. A lot of taxpayer money is propping up corporations that are circling the drains. In this economic climate I do not see anything blameworthy in the G loaning funds to a solar company that thought they had a technology that could be proven for commercial application. The G backs this sort of thing all the time. Solyndra cratered, the G looks bad, how shocking, so forth.
Right roboturkey, it's like when I was a kid and a bad report card arrived. Saying to my parents, "but Jimmy's grades are even worse than mine," didn't work for me. Psssst... that tack ain't working for you either.
Frankly, I'm pleased that we taxpayers were subordinated. That's what MADE this a story. Had "the taxpayers" been reimbursed first, the money would NOT have been returned to taxpayers. It would simply have gone into another pet program and been thrown (tried to use a naughty term, system wouldn't let me) away with little or no attention.
The arrogance of O and his cronies strikes again, while roboturkey and his MSM friends try desperately to sweep it under the rug.
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