White House's Haste On Solar Firm Loan Creates Political Headaches
While there are still many open questions, some things are more certain in the sorry tale of Solyndra, the now bankrupt solar-cell manufacturer President Obama once praised as a model for the nation's renewable energy future.
One, U.S. taxpayers will take a loss on their $535 million federal loan guarantee that was part of the stimulus program.
Two, 1,100 workers have been laid off.
Three, the Federal Bureau of Investigation last week raided Solyndra's offices.
Four, the Obama White House has an uncomfortable political problem because of its past support for Solyndra.
Five, the president's political opponents will continue to exploit that White House discomfort to greater or lesser degrees. Republicans cite it as a failure and symbol of the hasty wastefulness of the 2009 stimulus program. They say it raises doubts about the administration's funding of green technology. And it's an example of crony capitalism, they charge.
Much of the rest is unclear, at least to outsiders looking in.
One of the biggest questions is, did White House officials improperly pressure the Office of Management and Budget to approve the loan guarantee to Solyndra, a company with an investment from a foundation associated with Tulsa billionaire George Kaiser, a major Obama fundraiser. Kaiser has denied that he did anything to secure the federal loan guarantee and White House officials say there was no interference from them.
Washington Post reporters obtained emails that suggest, however, that White House officials did push the Office of Management and Budget harder than OMB officials would've liked to speedily review Solyndra's application to keep on schedule an official groundbreaking event featuring Vice President Biden.
An excerpt from a Washington Post story by Joe Stephens and Carol E. Leonnig:
One e-mail from an OMB official referred to "the time pressure we are under to sign-off on Solyndra." Another complained, "There isn't time to negotiate."
"We have ended up with a situation of having to do rushed approvals on a couple of occasions (and we are worried about Solyndra at the end of the week)," one official wrote. That Aug. 31, 2009, message, written by a senior OMB staffer and sent to Terrell P. McSweeny, Biden's domestic policy adviser, concluded, "We would prefer to have sufficient time to do our due diligence reviews."
What makes the current situation especially ironic is that OMB officials warned White House officials that the rush might lead to later regret. Another excerpt:
In one e-mail, an assistant to Rahm Emanuel, then White House chief of staff, wrote on Aug. 31, 2009, to OMB about the upcoming Biden announcement on Solyndra and asked whether "there is anything we can help speed along on OMB side."
An OMB staff member responded: "I would prefer that this announcement be postponed. . . . This is the first loan guarantee and we should have full review with all hands on deck to make sure we get it right."
That now seems prescient.
A House Energy and Commerce subcommittee held a hearing Wednesday on the Solyndra debacle. The full committee's chairman, Rep. Fred Upton (R-MI) noted in his opening statement that Solyndra has set off alarm bells for the administration's loan guarantee program which has already committed $8 billion in loan guarantees and has until the end of September to commit $10 billion more:
Was Solyndra just one bad bet by an Administration rushing to claim credit for the first loan guarantee, or is it the tip of the iceberg? DOE has closed over $8 billion in loan guarantees to other "green tech" companies, and it has about $10 billion left to spend in the next few weeks, before the September 30 deadline.
If the administration was so wrong about Solyndra after nine months of due diligence, how can it possibly exercise the proper controls when doling out $10 billion dollars in a matter of weeks? In this time of record debt, I question whether the government is qualified to act as a venture capitalist, picking winners and losers in speculative ventures and shelling out billions of taxpayer dollars to keep them afloat.