U.S. Solar Enterprise Goes Bust

Obama’s green model company – a millions’ grave

“Here is the future”, cheered Barack Obama when the Solyndra company inaugurated its new factory. The manufacturer of solar cells was regarded as a model example of a new green American economy. Only 15 months later, the company goes bust and the U.S. president has to face uncomfortable questions:

• Suspect: Subsidy fraud

• Twilight: Major patron of the Democrats

Barack Obama was in the best of spirits. The president was able to ‘do good’ in Fremont, California, on this sunny morning in May 2010. Here, at the edge of Silicon Valley, the company Solyndra, built its huge assembly plants on a green pasture. The manufacturer of solar panels presented the plant as model example for Obama’s vision of a new, green U.S. economy.

Washington assisted the start-up with a state-backed guarantee to cover Solyndra’s debt worth $535 million. Obama went into a rave about “thousands of new jobs” and about the belief that over years, the factory would produce enough solar collectors, “to replace eight coal power plants”. The guest (Obama) had no doubts: “Here is the future!”

Only 15 months later, that is already ‘passé’. At the end of August, Solyndra filed for bankruptcy, 1,100 workers are now out on the street and it looks like the Obama administration has to write off $528 million of the tax-payers money. That is why outrage has now broken loose in Washington. The Republicans complain about sloppiness and wastefulness. They are even suspecting corruption. The Solyndra case came like a windfall for the opposition, which scourges that every subvention by the state is a violation against the market rules: Only the previous week, the president asked for $450 billion more from Congress in a passionate speech to fight America’s massive unemployment.

Exactly during Obama’s appearance on Capitol Hill, FBI investigators started to search Solyndra’s business head quarters in Fremont. They suspect subsidy fraud. Investigations are also under way in the capital city. A hearing of the environmental committee in the House of Representatives brings all kinds of e-mail messages to light. Among other things, they show that the White House exercised pressure in late summer 2009 to push the multi-million dollar state guarantee for the solar enterprise through the government bureaucracy.

No time for questions

The responsible Ministry of Energy had already approved the deal while the government examined the Solyndra portfolio. They had questions, but as an official regrets: “no time to negotiate”. On August 31, an assistant of Rahm Emanuel, at the time the almighty chief of staff in the White House, asks again in writing: “Can we help with anything to accelerate this (deal)?”*

Vice-President Joe Biden was whining that he personally wanted to announce the state-backed guarantee for America’s sunny future. The budget office hesitated: “I would prefer that we postpone the announcement”, was the written answer from the official, “we should conduct a thorough examination to ensure that we get it right.”* Only four days later was Biden allowed to make the company happy with a congratulatory video call about the approval of the funds: “You guys have it made!”*

The Republicans have yet a more evil suspicion. They are pointing out that billionaire and philanthropist George Kaiser is the biggest investor in Solyndra. He was one of the main contributors of the Democrats in the 2008 election campaign and these days still goes frequently in and out of the White House. A second look would presumably reveal that Republican patrons also had shares in the bankrupt company.

Aside from that, this affair reveals another bust: The controversial credit program for green workplaces scantly picked up. Instead of 65,000 new jobs, it has only created 3,545 so far.

*Editor’s note: Although accurately translated, quotes could not be verified.