Until now the Solyndra scandal only reached the White House in the guise of e-mails from staffers fretting about the political implications of the disastrous bankruptcy and how it would reflect on the President’s “Winning the Future” rhetoric.
Until now, the Solyndra scandal was a circumstantial log of White house visits by a big Obama donor who also was the failed solar company’s chief investor (those visits occurring right before a half-billion dollar loan guarantee was awarded by Obama’s Dept. of Energy).
Until now, the White House’s direct involvement in the Solyndra scandal appeared to be over-zealous operatives looking to speed-up the loan so Vice President Biden could have a nice photo-op at the doomed solar firm.
Now, we know much more.
According to an investigation by the Los Angeles Times, President Obama was warned nearly a year ago that Energy Secretary Stephen Chu’s department was not rigorous enough in vetting loan recipients and they ran the risk of funneling federal money to companies that shouldn’t receive it, or didn’t need it. And the warnings came from the President’s top economic advisers Lawrence Summers and Timothy Geithner.
Summers and Geithner also warned about the overall risks involved in relying so heavily on pumping federal stimulus money into unproven programs and technologies which would not have any lasting positive effect on the moribund economy and the stagnant job picture in America.
The divisions foreshadowed a question that has emerged since Solyndra’s bankruptcy: Was the program’s vetting process thorough enough? The disagreements also spotlighted an issue that has confronted Obama since he took office: What is the appropriate role of the government in stimulating the private marketplace?
Skeptics, noting that taxpayers could now be on the hook for $527 million the federal government loaned Solyndra, said the administration would have been better off making greater use of market incentives, not individual company loan guarantees.
“It was completely predictable that there would be a colossal failure among the bets,” said one person familiar with the internal debate.
The meeting took place in the White House last October.
Now that we know what the President knew, and when he knew it, it’s instructive to look at how his administration reacted to the information provided by the President’s top economic geniuses. The White House ignored their advice and doubled-down on the risky and fruitless endeavor of “investing” in unproven companies like Solyndra.
Here are the key actions by the White House since hearing the advice from Summers and Geithner about the risks of the President’s policy:
- Within months of the fateful meeting, the DOE restructured the Solyndra loan allowing the tax-payers to take the back seat to private investors if any money were to be paid back. This move appears to be unlawful according to Rep. Cliff Stearns of the House Energy Committee.
- In the President’s State of the Union in January 2011, Mr. Obama lectured lawmakers on the importance of “Winning the Future” and implored them to send our country further into debt by “investing” in more “green technologies” like Solyndra.
- Just today the Dept. of Energy announced a $737 million loan guarantee for a Nevada solar project in direct contradiction to the Treasury Secretary’s advice.
Yes, now we know what the president knew and when he knew it. Unfortunately, it appears the president didn’t learn anything from it.
He also lives up to the satirical definition of insanity:
“Doing the same thing over and over again but expecting a different result.”
Tom in NC