Wow, which radical right-wing deathbeast Obama-hating Rethuglican Web site ran that headline?
Err, NBC’s Bay Area affiliate:
The lede is equally brutal:
President Obama faces political catastrophe in the form of Solyndra — a San Francisco Bay area solar company that he touted as a gleaming example of green technology. It has announced it will declare Chapter 11 bankruptcy. More than 1,100 people will lose their jobs.
During a visit to the Fremont facility in spring of 2010, the President said the factory “is just a testament to American ingenuity and dynamism and the fact that we continue to have the best universities in the world, the best technology in the world, and most importantly the best workers in the world. “
It’s not his statements the administration will regret; it’s the loan guarantees. The President was celebrating $535 million in federal promises from the Department of Energy to the solar startup. The administration didn’t do its due diligence, says the Government Accountability Office. “There’s a consequence if you don’t follow a rigorous process that’s transparent,” Franklin Rusco of GAO told the website iWatch News.
Last year, David Freddoso reported at the Washington Examiner, when Obama spoke at Solyndra, he claimed, “We can see the positive impacts [of the ‘stimulus’ package] right here at Solyndra:”
But even if Solyndra is a good example of what the stimulus package can do, it might not be the kind of example Obama wants to publicize. Jim McTague of Barron’s noted over the weekend that, two months before Obama’s glowing speech, PricewaterhouseCoopers released a fear-filled note in its audit of the company, which has accumulated losses of $558 million in its five-year lifetime. The firm noted that Solyndra “has suffered recurring losses from operations, negative cash flows since inception and has a net stockholders’ deficit that, among other factors, raise substantial doubt about its ability to continue as a going concern.”
Obama seemed almost unaware of this when he spoke.
“We can see the positive impacts right here at Solyndra,” he said. “[T]hrough the Recovery Act, this company received a loan to expand its operations. This new factory is the result of those loans. Since the project broke ground last fall, more than 3,000 construction workers have been employed building this plant. Across the country, workers in 22 states are manufacturing the supplies. … Solyndra expects to hire 1,000 workers to manufacture solar panels. …”
In September 2009, months before the scathing PricewaterhouseCoopers audit, the Department of Energy had announced $535 million in taxpayer-backed loan guarantees for Solyndra. Before the ink was dry on that deal, Solyndra applied for yet another loan guarantee, this time of $469 million. That application is pending.
In case you’re not familiar with federal loan guarantees, here’s how they work: If the company doesn’t pay back the loan, then taxpayers do it for them. So if you’ve ever been tempted to roll the dice on a high-risk investment, don’t bother. The government did it for you.
(H/T: Noel Sheppard, Newsbusters)
Update: Welcome Jim Geraghty, Stacy McCain, Ace and Insta-readers. And found via Kate of Small Dead Animals, John Hinderaker of Power Line asks a rather salient question: “Is it possible that the Obama administration can’t even do crony capitalism right?”