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by Don Azarias
November 1, 2011
“Spend and waste the taxpayers’ money. Never mind that we are trillions of dollars in debt.” That seems to be the rallying cry of President Barack Obama and the Democrats who are hell-bent on making their payback to their political sponsors instead of protecting the American taxpayers.
In my last article regarding the failure of Solyndra, a California solar panel maker that went bankrupt after receiving $535 million in government loan and laid off 1,100 workers, I wrote about the widespread public disapproval and the Republicans’ disgust about Obama’s attempt to provide government loan guarantees to companies that are connected to people who made big contributions to his political campaign.
Solyndra, of Fremont, Calif., was the first company to receive a loan guarantee under a stimulus-law program to encourage green energy and was frequently touted by the Obama administration as a model. Since then, the company’s bankruptcy filing and revelations that officials hurried review of the loan in time for a September 2009 groundbreaking has become an embarrassment for Obama as he tries to sell his job-creation program. Now the president and his Democratic allies are at it again.
According to the Associated Press (AP), the Department of Energy (DOE), recently approved two loan guarantees worth more than $1 billion for solar energy projects in Nevada and Arizona, two days before the expiration date of a program as the Obama administration pushed forward with the loan program despite pleas from GOP critics to halt it to avoid another Solyndra-like debacle. Then, in what seemed to be another fast track approval, the DOE approved four more solar energy loan guarantees worth nearly $5 billion, hours before a controversial loan program was set to expire. At least seven more projects worth more than $5 billion are pending as the Obama administration pushed forward with the loan program.
Energy Secretary Steven Chu said the department has completed a $737 million loan guarantee to Tonopah Solar Energrey for a 110 megawatt solar tower on federal land near Tonopah, Nevada and a $337 million guarantee for Mesquite Solar 1 to develop a 150 megawatt solar plant near Phoenix.
Also, according to Chu, the Nevada project would produce enough electricity to power more than 43,000 homes, while the Arizona project would power nearly 31,000 homes. The two projects will create about 900 construction jobs and at least 52 permanent jobs. “If we want to be a player in the global clean energy race, we must continue to invest in innovative technologies that enable commercial-scale deployment of clean, renewable power like solar,” Chu said in a statement.
Senate Majority Leader Harry Reid (D-Nevada), is a strong supporter of the Nevada project, which he says will help his state’s economy recover. Former Gov. Jim Gibbons, a Republican, also supported the project.
Rep. Cliff Stearns (R-Florida), chairman of a House energy subcommittee that is investigating Solyndra had this to say: “In a last-minute mad dash to beat the stimulus deadline, DOE rushed out an unprecedented tidal wave of taxpayer dollars——and the question still remains, ‘Where are the jobs? American taxpayers are already on the hook for half a billion dollars for the sins of Solyndra. What surprises does DOE have in store from (Friday’s) rush job?”
A government watchdog group said the Solyndra bankruptcy shows the need for greater oversight of all the department’s loan guarantee programs. “It is time for a full audit of their activities, their management and their results,” said Tom Schatz, president of Citizens Against Government Waste, Washington-based advocacy group. “Candidly, it might be time for the federal government to rethink the whole idea of loan programs,” Schatz added, calling the government’s track record on loan guarantees “lousy.” Too often, the government either backs risky or failing ventures, resulting in a loss of taxpayer money, or subsidizes companies and industries that are mature and profitable and don’t need the money, such as the oil and gas industry, Schatz said.
The Obama administration, in its attempt to insulate itself from public criticism, instructed the Justice Department to do what’s needed to take away control of Solyndra from its management and transfer it to a court-appointed trustee. In a filing with the U.S.Bankruptcy Court in Delaware, the Justice Department said it was seeking the appointment of a trustee because top Solyndra executives refused to answer questions about its finances and operations. Solyndra CEO Brian Harrison and financial chief W.G. Stover refused to testify before Congress last week, citing their Fifth Amendment protections against self-incrimination.
Solyndra, which filed for Chapter 11 bankruptcy protection in early September, faces a criminal investigation by the FBI, as well as scrutiny from congressional investigators and inspectors general at two federal agencies, Energy and Treasury. Experts said management often remains in control of a company during Chapter 11 reorganization, but in some cases a court orders the appointment of a trustee to take control. If the Justice Department motion is granted by the bankruptcy court, the trustee could make decisions about the company’s operations, including whether to liquidate the firm, a Justice Department spokeswoman said.
Chu said the solar projects, which could cost taxpayers as much as $6 billion, should help the U.S. as it competes with China and other countries to develop renewable energy. “To win the clean energy race we must invest in projects like this that fund jobs and increase the generation of clean, renewable power in the U.S.,” Chu said in a statement. “Deployment of utility-scale solar power will help bring down the cost of solar and strengthen our position as a global clean energy leader.”
But Mr. Secretary, is that good enough reason to continue to dole out taxpayers’ money to fund private business ventures and lose them because of your department’s incompetence?
It makes me wonder why Obama is in such a rush to approve these loans before the program’s expiration. Is he trying to make sure that he receives those capitalists’ campaign contributions or is he worried that he’ll lose the 2012 elections and might not have a chance to do a payback to his political bankrollers?