When President Obama was elected he promised to usher in a new way of doing business in Washington. Well past the half way point of his administration, it is clear that much like his promises of “Hope” and “Change” – a new Washington was little more than empty rhetoric.
Obama pledged to ban lobbyists from serving in his administration, but granted waivers to the lobbyists he wanted on his team. He pledged to make the White House more transparent, by placing its visitor logs on the internet, but his clever staff hosted meetings with lobbyists at local coffee shops, free from the burdens of disclosure. His reform rhetoric has masked the fact that his administration is actively doling out favors to entrenched special interests and his political supporters.
The most glaring example of President Obama’s “reformed” Washington, is how his political staff over stepped its boundaries to secure government support for a green energy startup funded by one of Obama’s biggest financial backers. The startup was named Solyndra. Financed by Obama funder George Kaiser, Solyndra produced solar panels for mounting on rooftops. They sold a dream – that you could transform the large empty rooftop square footage into a lean, mean, energy producing machine. This dream, much like Obama’s promises of hope and change, was never realized.
While the promise of Solyndra warms the hearts of the Al Gore’s of the world, the reality is that the business was flawed. This was clear to Wall Street, this was clear to senior government officials, but this was not clear to the White House.
Solyndra sought funding to build a plant to produce its unique brand of solar panels. It went to Wall Street, but was largely rebuffed. The most optimistic response Solyndra received was from Dun & Bradstreet which rated the company as “fair.” The ratings agency Fitch, rated Solyndra a B+, one of its most speculative ratings. One distinct problem for Solyndra was the excessive cost of its unique solar panels.
Absent broad Wall Street support, Solyndra looked to the government for assistance. During the Bush Administration Solyndra was denied loans by the Energy Department. The Office of Management and Budget recognized that Solyndra was too high a risk to move forward.
Once the Obama Administration ushered in its new way of doing business in Washington, things started to look brighter for Solyndra. Despite the Wall Street’s negative views of the company and its costly solar panels, Solyndra found support within Obama’s White House for its expansion plans.
The Department of Energy and the Office of Management and Budget took a new look at the Solyndra loan. This time they reached a different conclusion, they would support the proposal. This decision was not fully vetted because senior political officials in the Obama Administration demanded the decision be made on a truncated timetable. The reason for the rush – Vice President Joe Biden planned to attend the groundbreaking ceremony of the new Solyndra plant and wanted to announce the government’s support of the program. This political maneuvering helped secure Solyndra a $535 million dollar loan guarantee.
To sweeten the pot even further, the Obama Administration tailored the loan in such a way that if Solyndra went bankrupt investors like George Kaiser would be bailed out first and the taxpayers would be left holding the bag. This is crony capitalism at its worse because the American taxpayer gets hurt in the end.
So how do you secure such special treatment from the government for a flawed startup company? If you’re George Kaiser, it begins with spending $53,500 in support of President Obama’s 2008 campaign. That kind of money buys you access in Obama’s “reformed” Washington. Then you grease the wheels by donating $10,000 to Michelle Obama’s pet project, the University of Chicago’s Urban Health Initiative. Drop by the White House a couple of times and meet with Valarie Jarret who also worked with the University of Chicago’s Urban Heath Initiative. Finally, you promise Joe Biden a nice press event where he can feel presidential. If you follow the Kaiser/Solyndra model, maybe you too can get the Obama Administration to bail out your failing business!
The whole $38.6 billion green jobs loan program has been a total failure. President Obama promised that the program would create or save 65,000 jobs. Government records indicate that the program has directly created an anemic 3,500 jobs. The American taxpayer has been hoodwinked by this failed program that has cost billions of dollars in taxpayer money.
Solyndra suspended its operations on August 31st sending 1,100 workers to the unemployment line. Congressional investigators must get to the bottom of this growing scandal. President Obama and all those who had a hand in this failed company must be held accountable. President Obama was elected on the mantel that he was reformer. I guess he could not shake the corrupt Chicago way when he came to Washington.