Tag Archives: Solyndra

Meet the FFB: The Largest D. C. Slush Fund Ever: Part 1

Way back in 1973, Congress created another apparent political money-laundering, graft, and bribery payout-machine, (using our tax dollars) titled  The Federal Financing Bank. (FFB) As always, when Congress creates a new way to try to steal more money from the working class taxpayers,( while trying to keep them from finding out about it ) they come up with wonderful, serious-sounding "mission statements" like the following supposed explanation of what the FFB was created for:

Federal Financing Bank The Federal Financing Bank (FFB) is a government corporation, created by Congress in 1973 under the general supervision of the Secretary of the Treasury. The FFB was established to centralize and reduce the cost of federal borrowing, as well as federally-assisted borrowing from the public. The FFB was also established to deal with federal budget management issues which occurred when off-budget financing flooded the government securities market with offers of a variety of government-backed securities that were competing with Treasury securities. Today the FFB has statutory authority to purchase any obligation issued, sold, or guaranteed by a federal agency to ensure that fully guaranteed obligations are financed efficiently

Congress created our Treasury Department in 1789 and then in 1913 created the Federal Reserve as a new U. S. central banking system.  If both the Treasury and the Federal Reserve are doing their jobs correctly, then why would congress decide to create The Federal Financing Bank in 1973?  The answer to that is the fact that there was no valid reason for creating the FFB, other than to obscure and hide the massive slush fund that Congress has given themselves in order to buy  votes and increase their power over the people.  (with your money)  I also find it highly hypocritical that certain politicians demand an audit of the Federal Reserve while ignoring this Congressional money-shifting-mafia style taxpayer-abusing fraudulent loan shark program called the FFB. One look at their July 2011 statement and we start to get a real idea of just how the tyrants of Congress view OUR tax dollars as their personal political piggy banks to buy some votes here, give relatives and friends a few billion there, all the while doing their best to make it difficult for the average taxpayer to recognize it as taxpayer abuse and fraud by creating another banking entity, and therefore creating another difficult paper trail to investigate. For the readers who do not click the link to the FFB page,  I shall include a few sections of just what they have been up to in the month of July of 2011, alone.  Note: This is the end of Sept, and we have YET to see the numbers for the FFB in August. They certainly know they are being scrutinized today for being the middleman in the Solyndra scandal among other things, so one could imagine the effort they will put into "creating" a nice clean August report, whenever they decide to grace us with that information.  First of all, how many readers even knew that the loan-sharks at the FFB "loaned" the USPS money every single day in July, 2011? Wait, I made a mistake there. The FFB loaned the USPS money every single day in July that they were open,  but sometimes,  like on July 13th,   for example, they loaned them money four times, not just once. Look right  here, if you do not believe the information stated in this article. The FFB takes however much money it wants from the U. S. Treasury and then "loans" it out as it sees fit, with little to zero Congressional oversight or input. This is mafia-style loan sharking except for one big difference: The mafia-don actually loans out his own money at super high interest rates. while the mobsters of Congress just take the taxpayer’s money from them to "loan" it out as they see fit, and if that loan goes to a relative or crony-capitalist such as Solyndra, they do not even charge them 1% interest!  Add to that the fact that Congress also often  "forgives" the interest rates on loans made to crony-capitalists, political vote buyers, and certain "colleges of color."  That’s right, as in this statement from a Fox News article by Elizabeth MacDonald yesterday, that first called my attention to the Congressional mafia-style loan sharking going on at the FFB:

For instance, the FFB has been hit with losses on loans to the U.S. Department of Agriculture, loans the Agriculture Dept. received to service rural utilities. The Agriculture Dept. is stiffing the FBB on interest it owes on these loans, a cumulative $1.7 billion in losses here.

The bank also lets the General Services Administration [GSA], as well as “Historically Black Colleges and Universities,” and the Veteran Administration slide on interest costs on their loans, too. The bank lets them defer interest costs “on their loans until future periods,” the KMPG report say.

So now our Congress thinks itself to be so all-powerful that it can break Federal anti-discrimination laws in Federal loan programs and favor one college over another based on the color of the skin of their students, and decide to forgive, or delay proper payment of the interest due on their taxpayer-funded loans. Notice how the Solyndra loans ( in link above) were  given out at a measely .01% interest rate there? The loan sharks of Congress dish out over a half a billion tax dollars to largely Democratic campaign donors, and then decide to basically do it for free? With our money. Just who in the hell do these people think they are here?  Congress has now given themselves the power to use taxpayer money to enrich themselves, their friends and relatives, and dole out billions of taxpayer dollars to phony companies and assorted dysfunctional entities like in the Solyndra Scandal of late. YES SOLYNDRA received loans from the FFB.

The FFB was akin to the mafia loan shark on the street who handed Solyndra the bag with half a billion taxpayer bucks in it, knowing darn good and well that they would be bankrupt in very short order as reports had told them YEARS before, when they were originally denied taxpayer funding by Congress and the GWB administration. Then the mafia Don, in this case the Democratic Party of tyrants in Congress, when told that Solyndra has went bankrupt and the taxpayers will not get any money back,  just shrugs his head and tells the loan collection agents not to worry about it, as it wasn’t their personal  money that was lost, it was just money he/they had stolen from the people to begin with. ( in taxes)  Easy come easy go, according to the Congressional loan sharks of today. Ms. MacDonald goes on to further show how this loan sharking "Bank" was flat broke in 2008, and yet has given out some 61 billion dollars in loans ( In just the month of July 2011 ) while Barack Obama and  the fake Democrats were ruling all of Congress. While Republicans have probably been up to their necks in this Congressional loan sharking scam in the past, thanks to the Solyndra scandal, we now see that it is mainly  Democrats who have been caught red-handed in the most recent episode of the FFB loan-sharking scheme of the past 3 years.

This little-known government bank, the Federal Financing Bank [FFB], had a zero balance in 2008 for green energy projects, but now, with little Congressional oversight, it is giving out billions of dollars in loans to White House pet projects often at dirt-cheap interest rates below 1% , plus the bank is funding the insolvent U.S. Post Office; the White House’s expensive green car projects at Ford Motor, Nissan and Tesla Motors; a $485 million loan to an expensive solar project that’s lost $160 million over the last three years that’s backed by Google, BP and Chevron; plus the FFB is funding the teetering HOPE housing bailout program, which gives delinquent mortgage borrowers breaks on their loans.

And if that isn’t enough to get your blood boiling yet, we now see the Agriculture department getting in on the pay-to-play loan sharking fraud from within the the FFB:

And according to KPMG’s audit report of the bank, the FFB is losing billions of dollars in taxpayer money because it is forgoing collecting interest costs on already inexpensive loans that are financing projects at agencies like the Agriculture Dept.

Ms. MacDonald takes it one step further in explaining that what should really have the taxpayers concerned is the fact that the loan sharking Tyrants of Congress  have now empowered themselves  through the The FFB to "borrow unlimited amounts of taxpayer money from the Treasury for these kinds of political pet projects. Under the 1973 “FFB Act, the bank may, with the approval of the Secretary, borrow without limit from the Treasury,” says the bank’s audited statements from KPMG." (emphasis mine) Considering that today’s Secretary of the Treasury is proven tax dodging felon Timothy Geitner,  it is of little comfort to the American taxpayers that all that Congress needs to access billions of dollars of the people’s money for their loan-sharking enterprise known as the FFB,  is Mr. Geitner’s approval. "The Treasury Department’s inspector general is now investigating the bank over its $528 million loan to Solyndra. FFB’s chairman of the board is Treasury Secretary Tim Geithner, and the bank’s board executives are Treasury officials." How many treasury executives did you people vote into office in 2010? If you said zero you get a star, as the U.S. Treasury is a bunch of political appointees who do not have the authority to bypass the U. S. Congress in giving out taxpayer funded loans. Clear enough Mr Geitner and company? Just because the past clowns of congress in 1973 decided to create this loan sharking bank at taxpayer’s expense does not make it Constitutional. Period.

 Most people go about their lives not concerned about things like this government loan sharking scam until someone gets killed or seriously hurt by it, as in the current Fast and Furious gunrunning scandal where our very own government enabled drug cartels to purchase assault weapons resulting in the murder of border agents and hundreds of citizens in the U.S. and Mexico. By then its usually too late, the innocent citizens are dead and buried, and, in the case of the FFB,  all the money has been stolen to never be seen again.   Even then, after the fraud, graft, loan sharking and outright theft of their hard earned money is exposed as it is right here, they say well you can’t fight the government so, oh well. The problem with that is that the end result will be that eventually all the money will be gone, America will default on her $15 trillion dollars of debt, and there will be chaos in the streets due to shortages of common everyday necessities,  such as food and shelter. This is not over-stated fear-mongering, but is in fact, a serious dose of the reality of what is happening in American politics today. When this country becomes insolvent, chaos will ensue, and society will become unstable.  Similar examples of the dangers of  common  types of loan-sharking that ends up hurting everyday people, can be seen in the mafia wars in NYC and across the nation in past history. The mafia employed loan sharks who mainly used unscrupulous tactics to take advantage of poor people who otherwise could not afford a loan. In the case of the FFB loan to Solyndra, Congress was told they were a bad risk to lend money to, but Democrats could not resist the chance to fluff up their campaign coffers with a few billion tax dollars, while also getting the head Democrat, one Barack Obama on national TV to be seen by millions of Americans promoting the "Successful Solyndra Solar Company."  Hint to the eventual Republican presidential candidate  winner in 2012: The video clip of Barack Obama while actually giving a speech touting the validity of green energy companies at the now bankrupt Solyndra Solar company will make a wonderful campaign ad in 2012. Oh yes we can.

 

The people of NYC were also living in fear at one point in history from the mob bosses and their loan sharks, as their power increased and the blood ran deep in the streets on a daily basis during their power struggles. Loan sharks would break legs and arms if you couldn’t pay up, unless they decided to just make you disappear altogether for being unable to pay up in full.  As the power struggle during the mafia wars ratcheted up, many innocent people were killed when they were caught up in the gunfire. The people saw that  as the mob’s power increased, life got worse and worse for them, and they were not even free to walk the streets safely at night. Murder became commonplace during the height of the mafia wars in America. Today, the blatant theft of our tax dollars is now becoming commonplace, due  to political greed and the career politician’s quest for more power over the people.

These acts of tax dollar thievery such as the loan-sharking scam at the FFB will eventually add to the already very dangerous debt load and impending insolvency of  America.  Billions are being stolen under the guise of government loans and bailouts, and eventually the people will have to make a stand by changing their government at it’s core, and the way they allow them to handle their business. We have already seen the theft of almost a trillion taxpayer dollars in the form of the stimulus bill of 2009, in which we were promised by Barack Obama, that all those taxpayer dollars  would keep unemployment under 8%. Over two years later, we see little to no actual accounting of all that money, but in fact we currently see between 15 and 20 million Americans either unemployed or underemployed as they struggle to make ends meet. The stimulus program was just another government loan-sharking scheme where the taxpayer got screwed while the politicians friends in the unions, their crony-capitalists in the green energy scams, and their direct and indirect relatives enriched themselves to the detriment of our economy. ( More on a big name politician involved in this fraud to come in part 2 ) This was also the very reason that Barack Obama and company directed all Democrats and their media puppets to stop using the word "stimulus" in public recently.  Americans got wise to that scam in 2010,  so politicians turned to their other loan-sharking scam known as the FFB, and started doling out taxpayer dollars through it in a pathetic attempt to obscure their obvious theft of billions of hard-earned tax dollars once again. Will the FFB  government loan-sharking fraud ever be honestly investigated in the United States Congress in the near future?  Considering that this so-called bank was set up for the sole purpose of enabling politicians to use it as a way to bypass certain aspects of Congressional accountability as to how our tax dollars are being spent, the answer to that question has to be an emphatic NO.

 

I,d like to personally thank Ms. Elizabeth MacDonald of Fox Business for having the fortitude and courage to originally report on the FFB, which should be more aptly titled the Congressional Loan-Sharking Criminal Enterprise of America. In Part 2 of this expose’ on the FFB Congressional loan sharking we will take it a step further, and show you just what your tax dollars have been funding through the FFB, and just which honorable members of our government have ties to the latest episodes of the FFB slush fund loan sharking at taxpayer expense saga. 

Updated info alert: Apparently the FBB exposure piece done by Ms MacDonald has drawn some damage control rhetoric from none other than than "someone" in the U.S. government. They had her change some tiny aspects of her article. Here is the link:  http://www.foxbusiness.com/markets/2011/09/28/government-bank-financing-more-solyndras/  The petty reasons for the minor changes in her article do not in any way change the fact that this is a Congressional-loan-sharking-criminal-enterprise using taxpayer dollars unconstitutionally ! 

 

 

 

 

 

 

 

 

 

Obama's Latest Plan: Rescuing America From Rich People and Success

Obama in WH Rose Garden announcing plans to save America from money

The President gave another campaign speech disguised as a “deficit reduction plan” Monday morning, this time in the White House Rose Garden.  Perhaps he hoped the the backdrop of thriving foliage would add to the illusion that his “plan” would help the economy thrive and flourish.  Here are some highlights from the campaign speech:

Obama wants $248 Billion to come out of Medicare, 90% of which will come in the form of reducing over-payments to providers.  Did you hear that, America? The administration that  has presided over recent scandals such as Fast & Furious and Solyndra, the administration that spends $3.93 billion a day (consider that a billion seconds=31 years and let that blow your mind) wants to reduce waste and fraud in Medicare? Don’t you feel safer already? I know I do.

Obama wants to increase taxes on the wealthy. The wealthy don’t pay enough in taxes, you know.  Wealthy people are selfish and evil and ugly.  They steal money from the poor and keep it all in giant vaults that can only be opened with giant keys.  Then they drink expensive champagne made from the tears of women, children and minorities.  It doesn’t matter that according to the IRS‘ own, easily located statistics, the top 50% of earners pay 97% of all income taxes, and the top 1% pay 39%.  Rich people are bad.  Unless their names are Pelosi, Obama, Clinton, Kennedy, Buffet, Jobs, Gates, Frank, Rockefeller, Feinstein, Kerry, Heinz-Kerry, Gore, Edwards…..oh, you get the point.

Obama wants to put caps on itemized deductions, close tax “loopholes”, and let the Bush era tax cuts expire on individuals earning $200,000/year and couples earning $250,000/year.  Thank God.  Since most small business owners file as individuals and depend heavily on itemized deductions to stay afloat, this new and fresh idea should effectively kill small business growth; and if there’s anything America needs less of its small business and the jobs they create.  If those businesses are allowed to thrive, they might become big businesses that earn a lot of money.  Then they’ll be rich.  To reiterate, rich people are bad. Its a good thing Obama is here to rescue the average American from…jobs.

Obama wants a “Buffet” tax, named for his favorite rich person, Warren Buffet.  This tax would raise the tax rate on individuals earning over $1 million per year.   Hey, small business owners and folks who have worked very hard to earn a nice salary -Warren Buffet wants to pay more taxes!  You should want that too.  But just in case you don’t, here is a plan to force you to pay more taxes.  You’re welcome.

Oh, did you know Warren Buffet has a secretary?  Its true.  Supposedly she pays a higher tax rate than he does.  Unacceptable!  Also unacceptable – giving the secretary a raise so she can move into a different tax bracket.  Let’s not get carried away here, folks!

Obama wants to reform the corporate tax rate while closing more of the dreaded “loopholes” (when is Hollywood going to make a horror movie about loopholes? They sound absolutely terrifying).  In case you were wondering, giving hundreds of millions in stimulus money to bankrupt solar energy companies and other energy providers to help “weatherize” homes, that’s not a loophole.  Its just being neighborly.

If you are feeling concerned that these “proposals” may seem a bit…one-dimensional, have no fear.  President Obama went on to assure Americans that “This is not class warfare, it’s math.”  Phew!  No worries, everyone.  Its all under control.  The same White House that saved and/or created 100 bazillion jobs has done all the math for you: $14,711,883,847,986 in national debt minus stimulus money payouts to cronies and unions= YOU NEED TO GIVE GOVERNMENT MORE OF YOUR MONEY…NOW!  Its a simple formula, really.  Now it is all up the the Republicans in the House to pass this campaign speech right away.

Goldman Sachs arranged Loan on behalf of Solyndra, Inc.

To date, public attention in the aftermath of the Solyndra, Inc. loan scandal has been focused on the relationship between the solar power company and the Obama administration. Behind the scenes, however, Goldman Sachs, the Wall Street investment bank that served as financial advisor to Solyndra, Inc. in its successful application for a $535 million loan guarantee by the U.S. Department of Energy, has been kept out of the daily news cycle surrounding Solyndra’s implosion.

Goldman Sachs was one of the banks in 2008 and 2009 that received billions of dollars in U.S. Government funds to help it to stay afloat. Goldman Sachs is a major player in almost every industry affected by federal legislation. According to opensecrets.org, Goldman Sachs gives the majority of its political contributions to Democrats. Public records for 2011-2012 reveal that Goldman Sachs has given President Obama $44,750 during this time period.

The following is a press release issued by Solyndra, Inc. on March 20, 2009 in which it announced the loan which has stirred up so much controversy. The last paragraph mentions Goldman Sach’s involvement in the deal.

Fremont, CA, March 20, 2009 – Solyndra, Inc. announced today that it is the first company to receive an offer for a U.S. Department of Energy (DOE) loan guarantee under Title XVII of the Energy Policy Act of 2005. Solyndra, a Fremont, California-based manufacturer of innovative cylindrical photovoltaic systems, will use the proceeds of a $535 million loan from the U.S. Treasury’s Federal Financing Bank to expand its solar panel manufacturing capacity in California.

“The leadership and actions of President Barack Obama, Energy Secretary Steven Chu and the U.S. Congress were instrumental in concluding this offer for a loan guarantee,” said Solyndra CEO and founder, Dr. Chris Gronet. “The DOE Loan Guarantee Program funding will enable Solyndra to achieve the economies of scale needed to deliver solar electricity at prices that are competitive with utility rates. This expansion is really about creating new jobs while meaningfully impacting global warming.”

Designed specifically for commercial, industrial and institutional rooftops, Solyndra’s proprietary photovoltaic (PV) systems generate significantly more solar electricity per rooftop at a lower installed cost than conventional flat panel PV technologies. Further, Solyndra’s PV systems are fast and economical to install due to the simple horizontal mounting and unique air-flow properties of the solar panels. Solyndra’s panels are fully certified for U.S. and international use and have been commercially shipping since July 2008.

The guaranteed loan, expected to provide debt financing for approximately 73% of the project costs, will allow Solyndra to initiate construction of a second solar panel fabrication facility (Fab 2) in California. On completion, Fab 2 is expected to have an annual manufacturing capacity of 500 megawatts per year. Solyndra and DOE will finalize the transaction upon completion of definitive documentation and satisfaction of certain conditions precedent. Over the life of the project, Solyndra estimates that Fab 2 will produce solar panels sufficient to generate up to 15 gigawatts of clean, renewable electricity–enough to avoid 300 million metric tons of carbon dioxide emissions. Further, Solyndra estimates that the construction of this complex will employ approximately 3,000 people, the operation of the facility will create over 1,000 jobs, and hundreds of additional jobs will be created for the installation of Solyndra PV systems, in the U.S.

“DOE, in consultation with independent consultants, performed a thorough investigation and analysis of our project’s financial, technical and legal strengths,” said Dr. Kelly Truman, Solyndra’s Vice President of Marketing, Sales and Business Development. “We are proud to be the first company to pass this comprehensive review, and we would like to acknowledge the exceptional efforts of the staff of the DOE Loan Guarantee Program Office.”

Goldman, Sachs & Co. acted as exclusive financial advisor to Solyndra in connection with this loan guarantee application.

There is a veritable plethora of connections between Goldman Sachs and the Obama Administration. Treasury Secretary Timothy Geithner is a former protégé of Robert Rubin, who served as Treasury Secretary in the Clinton Administration. Rubin is also a former co-chairman of Goldman Sachs. Gene Sperling, one of Geithner’s top advisers, reportedly received $887,727 from Goldman Sachs in 2008, according to s story in Harper’s Magazine which was published on October 15, 2009.

But the connections between Goldman Sachs and the Obama Administration go well beyond personal relationships. Money is also to be found in this relationship between the Executive Branch of the United States Government under Barack Obama and Goldman Sachs. Peter Roff, writing in U.S. News and World Report on April 20, 2010 in a story titled “Goldman Sachs May Be Obama’s Enron” said:

As the Democrats attempt to push a new financial regulation bill through Congress the emerging Goldman Sachs scandal threatens to engulf the Obama administration.
As most everyone now knows, the U.S. Securities and Exchange Commission has brought suit against the giant Wall Street firm, charging it deliberately misled investors who participated in a mortgage securities trade that was designed to fail. The firm, which posted a profit of more than $3 billion for the first quarter of 2010, denies the allegation, has come to symbolize in the minds of many the kind of bloated, malefactor of great wealth the Democrats used to suggest pulled the strings in the Republican Party.

The problem now is that the shoe is on the other foot.

As J.P. Freire writes in Tuesday’s Washington Examiner, Goldman Sachs employees gave Obama “nearly seven times as much as President Bush received from Enron workers.” He adds:

… the mere $151,722.42 (inflation adjusted) in contributions from Enron-affiliated executives, employees, and PACs to Bush hardly add up to Obama’s $1,007,370.85 (inflation adjusted) from Goldman-affiliated executives and employees. That’s also not taking into account how much Goldman contributed to Obama cabinet member Hillary Clinton ($415,595.63 inflation adjusted), which was itself almost three times as much as Bush received as well.

There’s more in the money trail between Obama, other top Democratic politicians, and Goldman Sachs. Goldman Sachs and its executives are major contributors to Democratic politicians at both the state and national levels. For example, Goldman Sachs former CEO Jon Corzine contributed $916,800 to Democratic politicians and the Democratic Party in recent years.

Goldman Sachs is also one of the heavy hitters in the lobbying industry. Reported expenditures by Goldman Sachs for 2011 have already reached $2.4 million. This figure was released by the Senate Office of Public Records and the data is accurate as of its release date of September 18, 2011. This is a paltry sum compared to the lobbying dollars Goldman Sachs reported for 2010. That figure reached $4,610,000. Goldman Sachs spent another $2,830,000 lobbying the Obama Administration and Congress during 2009. Goldman Sachs reported having hired 44 lobbyists so far in 2011. They also report 14 revolving door personnel. These are personnel who spend time in the private sector at Goldman Sachs and then move to the public sector and vice versa.

As the investigation into Solyndra’s loan proceeds, the involvement of Goldman Sachs in seeking a loan on behalf of a client who has now been revealed to have submitted such a poor application that the Bush Administration rejected it and even Obama Administration officials warned against granting the loan, is likely to be investigated. Questions remain for Goldman Sachs to answer, including what led Goldman Sachs to submit an application for a loan to the Department of Energy when, as the public now knows, the application package had major problems associated with it. It is assumed that Goldman Sachs also had access to the results of Solyndra, Inc.’s annual audit reports. The questions for Goldman Sachs will be what in those audit reports convinced Goldman Sachs that the loan was viable, was convinced Goldman Sachs that the loan could be repaid, and was undue access to the White House on behalf of Solyndra, Inc. granted in exchange for political donations? The FBI investigation has just commenced but the questions already are piling up and the Obama Administration, Solyndra, Inc. and Goldman Sachs will all be queried by investigators, the press, and the public demanding answers to these and other questions that will surely arise.

Solyndra Loans – What Did the WH Know and When?

The $535 (or $528) million Loan

Obama administration officials defended a $528 million loan to Solyndra, but stated that federal investment in alternative energy must continue.  [emphasis mine] The Obama administration stood by Solyndra, through auditors warned to not risk an initial public offering and a refinancing where taxpayers were behind new investors. A day before Solyndra ceased operations, the Energy Department turned down the company’s request to renegotiate the US loan agreement, saying “a second restructuring was not feasible.” And Department of Energy (DOE) executives participated in day-to-day operation of Solyndra.

DOE guarantee of a $535 million loan to Solyndra was small change. For example, First Solar, for its Sunlight and Topaz projects, received $3.7 billion. The DOE loan guarantees go to risky endeavors such as Solyndra. But, the government gave loans and breaks to Solyndra, backed by a major supporter of President Obama. Evidence suggested the government-backed venture was rather risky. Obama’s DOE pressed forth in the face of a sea of warnings in awarding its green energy loan. In 2008, Solyndra asked DOE for a loan to build a new plant to produce its unique solar panels. Fitch gave Solyndra a B+ credit rating. Dun & Bradstreet had already issued a credit appraisal of the company. Its assessment: “Fair.” Fitch Ratings spokeswoman Cindy Stoller said a B+ rating: “It’s a non-investment grade rating.” She provided a company ratings definition, showing that B+ falls between a “highly speculative” B and “speculative” BB.

When asked about the ratings, energy officials said DOE conducted “extensive due diligence” on the application, which included consideration of the Fitch rating. “We believed the rating, which is used to inform our analysis of potential risks associated with the loan, was appropriate for the size, scale and innovative nature of the project and was consistent with the ratings of other innovative start-up companies,” said spokesman Damien LaVera. In March 2009, Energy Secretary Steven Chu announced DOE’s guarantee of $535 million going to Solyndra. The loan would be provided by the Treasury Department’s Federal Financing Bank, with the Energy Department guaranteeing the issue in case of default.

Bottom line: Taxpayers were bankrolling Solyndra’s venture.

E-mails Show the WH Stayed Informed

E-mails showed the WH monitored DOE deliberations over whether to make a $535 million taxpayer-backed loan to Solyndra, a politically-connected solar energy company. Solyndra’s solar panel factory was touted as a centerpiece of Obama’s stimulus-backed green energy plan – billed as a way to jumpstart a promising new industry while creating jobs. Internal WH emails show the Obama administration monitored progress of the Solyndra loan, even as analysts expressed concerns about the risk involved. An analyst at the OMB advised against moving too quickly. Then DOE announced its commitment to guarantee the Solyndra loan, which the administration had fast-tracked as the first green energy project backed by stimulus dollars. Obama wanted to unveil the announcement while he was on a visit to California.

White House emails suggests the Obama administration pushed for approval of a $535 million loan to Solyndra, even as WH analysts warned the deal was “not ready for prime time.” The emails appeared to show the administration rushed to get the loan approval in order to announce the loan at Solyndra factory groundbreaking in September 2009. “One e-mail from an OMB official referred to ‘the time pressure we are under to sign-off on Solyndra.’ Another e-mail said, ‘There isn’t time to negotiate.'” Vice President Joe Biden’s chief of staff, Ronald A. Klain, had his reservations. “If you guys think this is a bad idea, I need to unwind the W[est] W[ing] QUICKLY,” Klain wrote in March 2009.

The Investigation

A House committee, the Energy and Commerce Committee, want to have the Obama administration provide answers for risking taxpayer money on Solyndra. “It is not the role of government to pick winners and losers in the market,” said Reps. Fred Upton (R-Mi) and Cliff Stearns (R-Fl). “How did this company, without maybe the best economic plan, all of a sudden get to the head of the line?” Upton said. The committee has been investigating Solyndra for six months, and wants to hear from officials with the DOE and the OMB, which played the central roles in approving the loan guarantee. The loan guarantee is an insurance policy against a company’s debt in the event of default. In Solyndra’s case, the guarantee came from the federal government.

House Republicans are planning to widen the scope of an investigation into Solyndra. “We can’t reveal the other ones we’re looking at, but we’re certainly looking at loan guarantees made through the Department of Energy related to solar panels, biofuels and the energy grid,” Stearns said. Republicans sent a letter to the White House asking for documents and emails related to the Solyndra loan guarantee.

Taxpayers Subordinated to Investors

The Obama administration let $385 million in taxpayer money for Solyndra be subordinated to money from investors in an unsuccessful effort to keep Solyndra from declaring bankruptcy. Solyndra’s liquidation value was $91 million to $99 million in December, 2010, which would have provided less than a 22 percent return to the government. By subordinating $385 million of the government loan to $75 million from investors, the government calculated that Solyndra’s conservative enterprise value this year would be $240 million to $360 million. So that means that, after paying off investors, taxpayers are the owners of a bankrupt company. The George Kaiser Family Foundation, backed by billionaire George Kaiser, holds about 35.7 % of Solyndra. Not that it means anything (sarcasm intended), Kaiser made 16 visits to the White House since 2009.

“Selection of companies to receive U.S. backing are ‘merit-based decisions’ made by career staffers at the Department of Energy, and the process for this particular loan guarantee began under President George W. Bush,” said DOE spoksman Eric Schultz. “Every project that receives financing through the Energy Departments goes through a rigorous financial, legal and technical review process,” Schultz said. What Schultz neglects to point out is that, during the Bush administration, Solyndra’s loan application was unanimously rejected.

Solyndra is the third US solar manufacturer to fail in a month. Five US companies have been awarded $1.56 billion in loan guarantees through a program championed by Obama. So, if these five companies have the same deal as Solyndra, “we ain’t seen nothin’ yet.”

But that’s just my opinion.

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