TUSCALOOSA, Ala. – Energy Secretary Steven Chu should resign as a result of the disastrous decision to guarantee $537 million in loans to failed solar panel manufacturer Solyndra.
The federal government’s rush to guarantee the loans despite numerous warning signs threatens to cost taxpayers more than $500 million. Career government employees repeatedly warned that this “investment” was flawed from the beginning. Not only was Solyndra betting on an unproven “thin film” technology, but it was trying to compete with a cost structure that was uneconomical even under optimistic assumptions.
Regardless of your position on the merits of government investments in green energy, you should insist on Chu’s resignation.
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As a skeptic, I’m horrified but not surprised at a massive loss of public money in a badly managed firm. But if you think green energy investments are a good idea in general, you should be furious over Solyndra.
Not only did the company hand out $37,000 to $60,000 bonuses to its managers as it spiraled into bankruptcy this summer. Solyndra built a brand-new facility in one of the highest cost locations in America rather than recycling an existing building in a cheaper location, ordered expensive robots that whistled Disney tunes rather than focusing its spending on production, and paid investors dividends even as the company ran short of cash.
As Rep. Brian Bilbray, R-Calif., noted, putting taxpayer money in such a firm was “felony dumb.”
Worse, there is little doubt that the decision to guarantee the loans was politicized. The email trail uncovered by congressional investigators demonstrates considerable political pressure from the White House to approve the guarantees, leading some to speculate it was due to the Solyndra connections of Obama donor George Kaiser and his George Kaiser Family Foundation.
Kaiser was a key fundraiser for Obama’s presidential campaign, hosting a 2007 fundraiser at his home that raised more than $250,000. Kaiser’s foundation (which had nearly $4 billion in assets in 2009) was a key investor in Solyndra.
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Again, Solyndra appears to be just the tip of the iceberg as we learn of more green energy firms with political connections that have received federal loan guarantees and other subsidies.
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