Obama’s government lifted up and subsidized Solyndra as a shining example of entrepreneurial savvy, developing America’s fortunes in the field of solar energy. They went bankrupt last month. Why do government methods make me so sad?
- Pres Obama says this is “the future” of solar energy. I don’t like that future. If the technology is really so poorly received that the companies go bankrupt, please stop jamming this technology down our throats. Instead, let the market mature and let customers find value.
- The FMB raided Solyndra facilities this week, investigating whether executives misled the government to secure more than $500M in loan guarantees.
- Solyndra filed for bankruptcy. The government stimulus didn’t help. It just flushes tax payer money down the drains. I guess it does promote jobs because the FBI and support agencies are now going to have to paw through the financial events.
- Collapse of Solyndra is a bad witness. The 2005 loan guarantee program received $Billions (that’s thousands of millions) from the 2009 stimulus. Solyndra was the first deal executed, and it’s a bad company bet, and a bad process demonstration.
- In 2009, $527M in funds arrive. March 2010, external auditors advise the company could not survive. May 2010, Pres Obama personally visits and hails the company as a “testament to American ingenuity and dynamism.” Feb 2011, with an out-of-court restructuring, the DOE agreed the government would be paid after private investors. Aug 2011, judge gives the company one month to find a buyer, or be liquidated.
- One of the private investment firms is from George Kaiser. Mr. Kaiser was also a campaign contribution bundler for Pres Obama. He gets paid back before the taxpayers.
- A bad bet from the beginning, why does our Federal government need to put money at risk to artificially jack up the progress of this technology?
- Why all the targeted, custom selection of friend-related businesses? Bank bail-outs happened the same way. How about removing the burden of so many regulations, and let all the distributed businesses succeed? The only reason I can find is that it would be a loss of control. It seems these days, the government wants to collect money and selectively distribute it, rather than just stop collecting and let everybody succeed.
- I am again reminded that whoever controls the purse strings, controls the agenda. Well, then the lawyers control the comptroller. No wonder a company like this cannot survive. Where are the engineers actually *doing* the job of designing solar energy?
Quoted from WSJ, today: “The new factory built with Department of Energy funds foisted fixed costs on a company already struggling through an industry shake-out, they say. What’s more, the debt paradoxically made raising more money difficult. Once the government demanded priortity in the event of failure, private investors were less likely to prop up the company.”
There are just too many unintended consequences to flooding government money into situations. This is just one more example. People think they are helping because their vision goes out about 6 months or less. These are “kinetic kicks”. This is the same thing Obama is trying to do with his short-term, short-fix job plan. Instead of “kinetic kick”, we all need some “established equilibrium.” Something businesses can trust for the long term.