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Wednesday, October 26, 2016

Solyndra’s Bankruptcy: Another Watergate — Or Another Whitewater?

When the Republicans regained control of the House of Representatives last year, they vowed to launch dozens, perhaps hundreds, of shocking investigations of the Obama administration. So far their Congressional probing powers haven’t produced much in the way of shock, let alone awe. In the failure of Solyndra — a solar energy company subsidized with American Recovery and Reinvestment Act funds — they think they have finally uncovered a scandal that will prove the administration’s mismanagement and corruption.

According to their version of the Solyndra story, its bankruptcy shows not only that the White House misused stimulus money, but that solar energy doesn’t work and that all public investment (and especially the Obama stimulus) is synonymous with waste and fraud.

But as followers of wayward Washington know from long experience, some scandals are serious and troubling, while others are overblown and misleading. Watergate was a real scandal with vast implications; Whitewater was a fake, despite much huffing and puffing from the Beltway media. Which will Solyndra turn out to be? The initial indications suggest that it should do little damage, if any, to the Obama presidency — and that its meaning for the solar industry and public investment is the opposite of what conservative critics are claiming.

On Wednesday, the Republican-led House Energy and Commerce Committee released a report whose whose most damning conclusion after seven months of investigation is that White House eagerness to publicize progress on “green jobs” unduly influenced the decision to provide a $500-million loan guarantee to Solyndra. They leaked emails to the Washington Post suggesting that pressure to schedule a Solyndra photo op with Vice President Biden overrode concerns about the company’s solvency.

Those findings have been accompanied by much speculation — so far lacking any foundation — that political pressure on behalf of some Solyndra investors influenced the loan decision. One of the Solyndra investors bundled large sums for the Obama campaigns. But as other media have reported, the company’s second-largest investor is a fund backed by the Republican family that founded Wal-mart — and Solyndra’s CEO is a registered Republican, too.

Apart from all the noise and innuendo, there is a Justice Department investigation of the Solyndra management, some of whom are reportedly suspected of misleading federal officials in order to obtain the loan guarantee. And so far, that appears to be the limit of any plausibly alleged wrongdoing. It isn’t much — but there could be much bigger issues at stake here.

As for solar — and government’s green investments — the Solyndra case illustrates how mistaken we would be to abandon a vital future industry over one bad loan. The Solyndra loan guarantee represents just over one percent of what government spends on energy loan guarantees, and an even tinier fraction of the $10 billion or so spent every single year on average to subsidize oil, gas, and nuclear plants. You will never hear the Republican leadership complaining about those “market distortions.”

Solyndra went under because its technology was too costly to compete with the silicon-based panels produced by its competitors, both here and abroad, as the price of silicon fell drastically. Other factors contributed to Solyndra’s fall, including cheaper panels produced in China, where the state is heavily subsidizing renewable energy because the Chinese hope to dominate the world’s economic future.

Does government have an interest in promoting science and technology that benefit the public? The answer is yes, and in this country it has always done so, stimulating knowledge, commerce, environmental improvement, and gainful employment. Like so many other key technologies, from integrated circuits to the Internet, solar has become a viable alternative thanks to government support — in a world that desperately needs safe energy and clean jobs.

If there was criminal misconduct at Solyndra, it should be prosecuted — and apparently will be pursued by the Obama Justice Department. But there is no “scandal” here that justifies abandoning public investment or solar power.

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Copyright 2011 The National Memo
  • jonnyd

    To say that solar power doesn’t work is misleading. I had a solar system installed in my house free of charge and it works great. my electric bill for the last 3 months was $48 when last year is was approximately $150 per month. Before making a blanket statement like that as the media please do your homework.

  • panman62851

    Be it a windy day, water fallin off a cliff, sunshine or the dredded nuke plants, seems not to make a difference to the GOP. They would shoot their self in the face if President Obama simply told them he liked their smile. (pretty much a quote from Bill Mahr).It seems the bigotry and hatred runs deep in the GOP. For some reason they seem to trust the tried and true coal plants over anything else any way, but then they support anti labor and union busting tactics that spin Mining saftey flying up the not working ventilator shafts. They would be happy with company housing, Company stores and script replacing government money. As a guy that has worked in a coal generating sration I will tell you a couple of real FACTS…1) There is no such thing as clean coal. CleanER perhaps but coal is coal an it is a serious pollutant.2)Coal may on the surface may work, but these plants are serious money pits. At least one is down for overhaul, cleaning and asbestos removal /replacement (a month to two month procedure) ay all times. Hundreds of private contractor staffing are always their constantly maintaining these boilers at hundreds of thousands of dollars. Me and you pay them! this is on a constant rotation and is part of doing business. 3) Alternativly the wind will always blow, the sun will always shine and water will always fall over a cliff, at no charge to us…Think about it! Where you want to spend your tax dollars, China maybe?

  • Mother Outlaw

    I think Solyndra just failed for economic reasons. China can produce similar panels at much less cost and California is rather pricy in many respects. Yesterday it was announced that two other California solar panel producers are moving to Mississippi. The Golden State is getting tarnished.

  • peteserb

    The national memo should hire people over 25 to write their stories. Is Solyndra a serious case of fraud? You dam well better bet it is. The money squandered by the Obama administration was no more than an attempt to give Obama another “Green” talking point. It failed and your writer failed to paper over it. I’m glad you’ve shown what lies the left is capable of. Keep up the good work!

  • Jacquelyn Simone

    Thank you for your comment. Age does not necessarily qualify people to write about politics. Even so, The National Memo does hire people over 25 to write their stories, including Joe Conason, the author of this column. He has more than 35 years of journalistic experience, including The Village Voice, New York Observer,, and book projects, to name a few.

  • kurt.lorentzen

    Mother Outlaw is right! And that’s exactly why giving money to businesses doesn’t produce results. It just plain costs too much to produce a competitive product in the US. Rival solar energy companies hit the same wall and one recipient of the same funding is now in chapter 11 citing – you guessed it – inability to compete with Chinese solar products. This is the same problem faced by ALL US business. So think again before you blast the other side for saying over-regulation, union mob tactics (with the NLRB as their taxpayer-financed enforcers) and constantly changing tax codes aren’t a problem. Need revenue? Then create an environment where revenue-producing entities can hire some taxpayers and still make a profit!

  • DDavid Patterson

    The US cannot compete in the open market with $12 a day labor. Why would we want to? We must subsidize our new products
    until our productivity and innovation overcomes the competition from low wage countries. Of course the Chinese workers will
    eventually realize they are getting screwed and form unions but by that time it may be too late. Remember, higher wages for our workers mean higher demand for consumer goods and the ability to retire someday at a decent income. Of course, if one
    doesn’t give a rat’s tail about worker welfare or the long term future then one’s response to this issue will be different.

  • oz guy

    You say that it is not productive to give money to businesses. Why then is you kind so anxious to take money from the workers and the poor to give huge tax breaks to corporations?

  • herola

    The last time I heard- all the monies for economic recovery did not go to President Obama’s family account. It went into making life easier for Americans. The solyndra project is example how a lot of companies in US is “duping” the American people.Getting money from the “naive” Obama’s government and do nothing but put the money in the stock market to gain money for themselves and save on their taxes while the working class of the country is left holding the empty bag.
    Let the “dumning” of Americans continue by the so called “left”. It is just scary, very scary.

  • wmumart

    California is to over regulated, to strict on business. Building this in most expansive part of USA was totally political gift to Pelosi.
    If the product is as good as the owners are barging the world would pick up on this quickly.
    Competing with China is not easy same time the wages in China are skyrocketing and by 2015 many jobs will come back to USA. Of course only if we will revoke all the over regulations and close down EPA. Lay off 80 % of admi8nistartion and welfare state.

  • Bassicdave

    China is more competitive than the U.S. because of government investment. Therefore, government support is bad. Ok.

    The Solyndra loan was intiated during the Bush Administration. Therefore, the Obama Administration is bad. Check.

    Solyndra failed therefore Nancy Pelosi, EPA regulation, high corporate taxes, fraud, the Birkenstock company, or _________ (insert this morning’s GOP talking point here) must have been the cause. Right on.

    Peteserb and wmumart, next time try substantiating your assertion before writing letters like this. It’s good therapy AND you’ll look less like a marionette.

  • neutrino13

    I watched CSPAN and I learned that the officials of the Bush Administration decided to reject the grant application because Solyndra’s process was not properly validated. But even this fact is not relevant in the grand scheme of things. Here’s why:
    The conversion of energy from solar to electric is still not economically viable because the conversion factor is dismal. Instead of building solar pannel plants with taxpayers’ money which are obsolete before they produce the first pannel, the goverment should put the money into research. Let the chinese invest heavily in building plants that produce ineffient pannels because in the end the better technology will prevail. I want my government to be involved in funding research not in manufacturing. At this stage, research is where the real benefits are and I wouldn’t mind if the government labs would be allowed to license the process to the highest bidders. This way, we the taxpayers, can profit from solar pannels installed anywhere in the world. Plus, when $500 million of taxpayers’ money go to a company in which a major donor to the ruling party is invested heavily, produces a putrid smell that is hard to ignore. This becomes another reason for our dumb congress to avoid doing something about our unemployed fellow citizens. They will be busy investigating the Administration and the DOE.

  • jenny.hootyhoo

    Solyndra was supposed to have a Patent for a NEW, Solar product. Does the U S end up getting that Patent?

  • snarky

    It is too bad the repubs will assail chump change Solyndra, but won’t even consider taking a peek behind the veil of $100 Oil. I am confident there is much more involved with the $100 Oil than the one hundred bucks.