The Washington Examiner
written by Mark Tapscott, Editorial Page Editor
Wednesday August 31, 2011
A star of the burgeoning clean energy industry frequently touted by President Obama, Senate Majority Leader Harry Reid and other national Democrats burned out today as Solyndra LLC announced that it is shutting its doors, laying off 1,100 employees and filing for bankruptcy.
This is the same firm that received the Department of Energy's first loan guarantee under Obama's economic stimulus program, worth $535 million and guaranteed by - who else? - the American taxpayer.
At the time, Obama praised Solyndra in May 2010 during a widely publicized speech at the company's new Fremont, California, facility that was made possible by the federal loan guarantee.
“The true engine of economic growth will always be companies like Solyndra, will always be America’s businesses, ” Obama told the assembled company employees. “Less than a year ago, we were standing on what was an empty lot. But through the Recovery Act, this company received a loan to expand its operations. This new factory is the result of those loans.”
But in fact Solyndra has had troubles from its founding amid doubts about the viability of the solar energy market the firm's investors were betting would flourish if only the federal government would provide enough subsidies to keep it afloat.
Afloat that is until Big Green environmentalists, liberal Democrat politicians and Washington bureaucrats succeeded in making gasoline and coal-generated electricity so expensive and scarce that consumers would be willing to pay more for alternatives.
Expect Obama and other advocates of massive government subsidies for clean energy companies to put the blame for the lengthening list of clean energy industry failures like Solyndra on Republicans and conservatives in Congress and elsewhere who argue the government has no business picking winners and losers in the marketplace because consumers will always do a better job of it.
Brian Harrison, Solyndra's CEO, may have had such a blame game in mind in today's announcement with his observation that “regulatory and policy uncertainties in recent months created significant near-term excess supply and price erosion. Raising incremental capital in this environment was not possible."
Apparently Harrison was unaware that capital flows to where it's most needed to fulfill economic needs in a free market, unless it is prevented from doing so by government, which almost always acts at the behest of firms that can't otherwise raise sufficient funds to stay in business due to lack of demand for their products.
The loan guarantees are at the center of a sometimes testy contest between the House Energy and Commerce Committee's investigative subcommittee and Obama's top political appointees at DOE and the Office of Management and Budget, which reviewed the loan guarantee before it was awarded.
Obama's appointees have slow-walked responding to the subcommittee's request for documents concerning the loan guarantee, and have outright refused to provide many of those sought. A congressional subpoena was issued last month, but committee sources say administration officials have since been more responsive.
Upon hearing the news of Solyndra's bankruptcy, committee chairman Rep. Fred Upton, R-MI, and subcommittee chairman Rep. Cliff Stearns, R-FL, issued this statement:
“We smelled a rat from the onset. As the highly celebrated first stimulus loan guarantee awarded by the DOE, the $535 million loan for Solyndra was suspect from day one. Our investigation to protect American taxpayers has revealed that in the rush to get stimulus cash out the door, despite repeated claims by the Administration to the contrary, some bets were bad from the beginning. And yet, despite the red flags and vocal concerns this Administration continued to tout Solyndra as a stimulus success story, going so far as to have the President visit the plant last summer.
“It is clear that Solyndra was a dubious investment, but DOE doubled down in March of this year and restructured the loan, possibly further increasing taxpayers’ liability. That is a question we want answered. In this time of record debt such disregard for taxpayer dollars cannot be tolerated.
“For an administration that parades around the banner of transparency, they fought us tooth and nail all summer long in turning over relevant documents related to the credit approval, and today we found out why. Committee Democrats have played politics, protesting our investigation every step of the way, and our issuance of a subpoena for OMB documents was a 14 to 8, straight party line vote.
"But our investigation continues, and with Solyndra’s bankruptcy we expect full and continued cooperation from the OMB, as we must ensure American taxpayers are not left holding the bag. Unfortunately, Solyndra is just the latest casualty of the Obama Administration's failed stimulus, emblematic of an economic policy that has not worked and will not work. We hope this informs the President ahead of his address to Congress next week.”
For a timeline of the subcommittee's investigation of the Solyndra loan and related documents, go HERE.
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