A manufacturer of solar panels which President Obama touted as “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” has declared bankruptcy 15 months after the President touted it as the proud symbol of potential new Green Jobs.
It may be taking half a billion dollars worth of taxpayer money down the drain with it. “The federal government offered $535 million in low cost loan guarantees from the Department of Energy. NBC Bay Area has contacted the White House asking for a statement.” The failure of the company, according to sources of the Washington Post, was “unexpected”. Apparently nobody, least of all the President in the full rhetorical cry, anticipated that Solyndra, along with similar companies in California, would be driven down by cheaper competition from China.
“We have always recognized that not every one of the innovative companies supported by our loans and loan guarantees would succeed,” Energy Department spokesman Dan Leistikow said in a statement. “But we can’t stop investing in game-changing technologies that are key to America’s leadership in the global economy.”
The Treasury Department provided Solyndra’s loan, on the assurance of the Energy Department. The terms were reviewed in advance by the White House Office of Management and Budget, and almost all of the $535 million has been disbursed to Solyndra.
Taxpayers might be on the hook for most of the loan if Solyndra is unable to repay, said experts in the stimulus and loan guarantee program. The Energy Department could seek repayment in court, but receiving more than a nominal amount is unlikely because of the company’s depleted cash and assets.
Also in danger of being bankrupted was the image of President Obama competency in geography. When he declared Solyndra the way to a “brighter, more prosperous future” he failed to note that this future would transpire across the Pacific Ocean in China.
Part of the problem, according to Spengler at Pajamas Media, is President Obama’s difficulty with cost curves. Hiring what Spengler called “the best incompetence that money can buy”, the President nominated an economist to his Council of Economic Advisers to advise him. Unfortunately that economist believes that as prices go up, demand correspondingly rises. That is to say when Ramen noodles become more expensive, you buy more of it.
But on Planet Obama, Spengler notes, the demand curve slopes upwards. That could explain why he failed to foresee that China would beat out the government-backed solar companies in California. It costs China less to produce what California produces. So that should have meant boom times for California, on Planet Obama that is. Neverthless, the President has requested Congress to meet in joint session so that he can set the assembled legislators straight on the matter of creating jobs. Whatever else has declined the President belief in his own economic competence isn’t one of them.
Obama writes that it is his intention “to lay out a series of bipartisan proposals that the Congress can take immediately to continue to rebuild the American economy by strengthening small businesses, helping Americans get back to work, and putting more money in the paychecks of the Middle Class and working Americans, while still reducing our deficit and getting our fiscal house in order.”
The President is convinced he’s got the answer to the problems confronting the economy. “We don’t have magic bullets, but what we do have, I think, is the capacity to do some things right now that would make a big difference,” Obama said in a interview with popular radio talkshow host Tom Joyner. But with the company Solyndra gone, perhaps to be followed by other government companies in a similar competitive situation he’s going to need some his old magic back. Instead of “Hail to the Chief” the following music may be more suited to his Congressional address.
You-oo-‘ve got the magic touch (woo-oo)
It makes me glow so much (oo-woo-oo)
It casts a spell, it rings a bell
The magic touch.
If I go reeling, uh-oh
I’m feeling the glow (uh-oh)
But where can I go from you
I didn’t know too much (woo-oo)
And then I felt your touch (oo-woo-oo)
And now I’ve learned I can return
The magic touch