Welcome to Democrats’ “Green” Casino

October 11, 2011

Obama Says Democrats in Congress Designed the Stimulus to Let Him “Take Bets” on Solyndra—Bets that Cost Taxpayers Half a Billion Dollars

Defending his administration’s failed loan to now-bankrupt Solyndra, President Obama claimed last week that the Department of Energy’s loan guarantee program was designed by Democrats in Congress to “take bets” with taxpayer money, a role he evidently favors for the federal government.
The president’s attempt to paint Solyndra as a legitimate government “bet” obscures the fact that his administration pressured loan reviewers to rush their approval process in order to serve the political needs of the White House.
Moreover, the administration wanted to give Solyndra a second loan of more than $400 million to follow its first $500 million plus loan. If taxpayers have learned anything from this fiasco, it’s not to trust Democrats with their money.

BACKGROUND

Defending his administration’s failed loan to now-bankrupt Solyndra, President Obama claimed last week that the Department of Energy’s loan guarantee program was designed by Democrats in Congress to “take bets” with taxpayer money, a role he evidently favors for the federal government:

OBAMA: “THE NATURE OF THESE PROGRAMS… WAS TO TAKE BETS”: “And the nature of these programs are going to be ones in which for every success there may be one that does not work out as well. But that’s exactly what the loan guarantee program was designed by Congress to do, was to take bets on these areas where we need to make sure that we’re maintaining our lead.” (“News Conference by the President,” The White House, 10/6/2011)

OBAMA CLAIMED “HINDSIGHT IS ALWAYS 20/20,” AND SOLYNDRA “WENT THROUGH THE REGULAR REVIEW PROCESS”: ” ‘Hindsight is always 20/20,’ Obama told ABC Good Morning America anchor George Stephanopoulos in an interview broadcast online Monday. ‘It went through the regular review process and people felt that it was a good bet.'” (Matthew Mosk and Ronnie Greene, “Obama on Solyndra: ‘Hindsight is Always 20/20,'” ABC News, 10/3/2011)

The president’s attempt to paint Solyndra as a legitimate government “bet” obscures the fact that his administration pressured loan reviewers to rush their approval process in order to serve the political needs of the White House:

OMB STAFFERS SPECIFICALLY INVOKED PRESSURE FROM OBAMA IN TRYING TO RUSH LOAN: ““White House staff discussed in emails that either President Obama or his former chief of staff Rahm Emanuel were eager to help spotlight a solar company in early 2009, despite numerous internal warnings that the company could be financially unstable, according to new e-mails. …

” ‘Ron said this morning that the POTUS definitely wants to do this (orRahm definitely wants the POTUS to do this ?),’ one White House staffer told an Obama scheduler on Aug. 17, 2009.” (Carol Leonnig, “Solyndra: Obama and Rahm Emanuel Pushed to Spotlight Energy Company,” The Washington Post, 10/7/2011)

“WHITE HOUSE BRUSHED OFF SOLYNDRA WORRIES, E-MAILS SHOW”: “White House officials dismissed concerns about Solyndra LLC ahead of President Barack Obama’s May 2010 visit to the failed solar-panel maker, despite acknowledging that the company and other clean-energy ventures could go ‘belly-up’ by the 2012 election, according to emails released by Democratic lawmakers.” (Deborah Solomon, “White House Brushed Off Solyndra Worries, Emails Show,” The Wall Street Journal, 10/3/2011)

SOLYNDRA REVIEW TOOK ONLY 9 DAYS; AVERAGE WAS 28 DAYS: (Ryan Tracy, “House Probes Solyndra Loan,” The Wall Street Journal, 9/14/2011)

E-MAILS SHOW WHITE HOUSE TRIED “TO RUSH FEDERAL OFFICIALS” TO ISSUE SOLYNDRA LOAN: (Tim Mak, “Report: White House Pushed on Solyndra,” Politico, 9/14/2011)

OMB TO WHITE HOUSE, MARCH 2009: “THIS DEAL IS NOT READY FOR PRIME TIME”: (Phillip Klein, “OMB Had Warned Solyndra ‘NOT Ready for Prime Time,'” The Washington Examiner, 9/14/2011)

OMB STAFFER CALLED OUT WHITE HOUSE: “WE WOULD PREFER TO HAVE SUFFICIENT TIME TO DO DUE DILIGENCE REVIEWS AND HAVE THE APPROVAL SET THE DATE FOR THE ANNOUNCEMENT RATHER THAN THE OTHER WAY AROUND”: (Ryan Tracy, “House Probes Solyndra Loan,” The Wall Street Journal, 9/14/2011)

OMB STAFF WORRIED THAT “GIVEN TIME PRESSURE WE ARE UNDER TO SIGN-OFF ON SOLYNDRA,” NO TIME FOR THOROUGH RISK ASSESSMENT: (Tim Mak, “Report: White House Pushed on Solyndra,” Politico, 9/14/2011)

OMB TOLD WHITE HOUSE: WE “WOULD PREFER THAT THIS ANNOUNCEMENT BY POSTPONED”: (Tim Mak, “Report: White House Pushed on Solyndra,” Politico, 9/14/2011)

Moreover, the administration wanted to give Solyndra a second loan of more than $400 million to follow its first $500 million plus loan. If taxpayers have learned anything from this fiasco, it’s not to trust Democrats with their money:

OBAMA’S DEPT. OF ENERGY “WAS ACTIVELY PUSHING” SECOND LOAN GUARANTEE WORTH $469 MILLION:“The Obama administration’s Department of Energy was poised last summer to give Solyndra a second major taxpayer loan of $469 million, even as the company’s financial situation was growing more dire.

“The Energy Department was actively pushing to provide the second loan guarantee to the troubled solar-panel manufacturer in April and May 2010, when Solyndra’s auditors warned the company was in danger of closing due to its rapidly mounting debts and expenses, according to complete e-mails just released by a House committee investigating the original loan.” (Carol Leonnig, “Solyndra E-mails: Dept. of Energy was Poised to Approve $469 Million for Firm,” The Washington Post, 10/5/2011)

BUT DOE OFFICIALS WERE WELL AWARE OF SOLYNDRA’S TROUBLES, USING “GALLOWS HUMOR” AND PREDICTING DEFAULT: “White House career staffers, who had first raised concerns in the fall of 2009 about the Department of Energy providing Solyndra with its first taxpayer-backed loan of $535 million , wrote e-mails in gallows humor in April 2010 about the prospect of giving Solyndra more money. That spring, industry analysts were publicly questioning how the Silicon Valley startup could so quickly be running out both the federal loan and $933 million in private capital.

” ‘Apparently the loan size for Phase II is $469 million,’ one Office of Management and Budget analyst wrote of DOE seeking a second loan for Solyndra. The analysts’s name was not released by the committee. ‘I’ve been told we should expect the see that project soon for conditional commitment.’

“Another joked: ‘Possible to close and default on one before closing on a second??? Could be a new record.'” (Carol Leonnig, “Solyndra E-mails: Dept. of Energy was Poised to Approve $469 Million for Firm,” The Washington Post, 10/5/2011)

NO WONDER EVEN LEFT-LEANING EDITORIAL BOARDS ARE CRITICIZING OBAMA’S JUDGMENT:

THE WASHINGTON POST: “SOLYNDRA: A BAD BET OBAMA SHOULD REGRET”:“The important lesson is that the government ‘is a crappy vc’ — venture capitalist — as then-White House economic adviser Lawrence Summers put it in an internal e-mail. Government can foster clean energy by subsidizing basic research, whose fruits become available to a variety of entrepreneurs, and by setting broad incentives that shift demand in favor of alternative energy. Subsidizing selected technologies or companies, by contrast, is a game that taxpayers often lose, as the history of boondoggles from synthetic fuels to the fast breeder reactor suggests. We suspect China will learn this lesson, too.” (Editorial, “Solyndra: A Bad Bet Obama Should Regret,” The Washington Post, 10/6/2011)

USA TODAY: SHOULD “UNCLE SAM PLAY VENTURE CAPITALIST? SEE SOLYNDRA”: “Even if Solyndra’s collapse is nothing more than good intentions gone awry — a big if — it is a cautionary tale about why government should be extremely wary about betting tax dollars on specific companies. If there’s one thing the marketplace virtually always does better than government, it’s picking individual successes in an uncertain and highly competitive business. In fact, government involvement can unfairly tilt the playing field toward one company and away from competitors.” (Editorial, “Uncle Sam Play Venture Capitalist? See Solyndra,”USA Today, 9/14/2011)