November 16 2011

Annals Of Transparency: The Solyndra Layoffs

Charlotte Hays

Let me get this straight: The Obama administration wasted half billion dollars of taxpayer money and then tried to keep us from finding out about it until after the 2010 midterm elections.

That is about the size of it:

The Obama administration wanted the failing solar energy company Solyndra to delay announcing an early round of employee layoffs until after the 2010 midterm elections, according to newly released emails.

An October 2010 email from a Solyndra investment adviser to a colleague said Energy Department officials were pushing "very hard" to delay making the layoffs -- an early sign of the company's financial woes -- public until Nov. 3, 2010 -- the day after the midterm elections.

"Oddly they didn't give a reason for that date," the email states….

According to the Washington Post story quoted above, the push to delay layoffs was coming from officials in the Department of Energy. This should provide conversational fodder tomorrow when Secretary of Energy Steven Chu is scheduled to appear before Congress to discuss the Solyndra loan.

Congress should not just focus on how the Sylyndra mess was made and the need for “more oversight” (yada yada) but on whether government should have these vast pots of money to invest in pet projects in the first place. Please  ask Mr. Chu what, other than a fondness for green energy, makes him qualified to invest our money.

One argument against government investing is that if a project is going to fly, it will attract money from private investors. In fact, the willingness of an investor to risk money is a good barometer of whether an endeavor is likely to succeed. Injecting public money distorts the market and leaves taxpayers—not people who have gone into the deal with their eyes open—on the hook for the money.

These emails make clear another reason that government shouldn’t be in the investment business: Government can put pressure on companies to, at least temporarily, hide failure from the taxpayers, the source of the money, for political reasons.

Speaking of politics and investment, the Los Angeles Times reports on what Reason magazine (“Annals of Crony Capitalism”) dubs a “sweetheart deal” for a Democrat-friendly a biotech company:

Over the last year, the Obama administration has aggressively pushed a $433-million plan to buy an experimental smallpox drug, despite uncertainty over whether it is needed or will work.

Senior officials have taken unusual steps to secure the contract for New York-based Siga Technologies Inc., whose controlling shareholder is billionaire Ronald O. Perelman, one of the world's richest men and a longtime Democratic Party donor.

A pox on letting the federal government invest our money!

 

 

 

 

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