Green jobs and gray areas

It remains to be seen whether the bankruptcy of the Solyndra solar panel firm in California was just another expensive government blunder or possibly a bona-fide scandal. But it is already an obvious and growing embarrassment to the Obama administration, a prime example of stimulus funding failure and Washington crony capitalism.

Solyndra received a $530 million federal loan through the American Recovery and Reinvestment Act that was replete with spending aimed at “green job” creation. The company filed for bankruptcy Sept. 6 and started laying off nearly 1,200 employees, basically leaving taxpayers on the hook for the squandered loan.

Let’s be clear about one thing. Just saying green jobs are the key to saving the planet does not make it so. In fact, so far you can’t even say that green jobs are the key to saving the economy. In this case, Solyndra was a hemorrhaging venture that ran squarely into powerful market forces, most notably heavily subsidized competition in solar technology from China. 

In May of 2010, President Obama visited the company to tout it as an example of stimulus funding success, but it has become a flashing marquee of failure.

“It is here that companies like Solyndra are leading the way toward a bright, more prosperous future,” he said at the time.

“We can see the positive impacts right here at Solyndra,” he said. “Through the Recovery Act, this company received a loan to expand its operations. This new factory is the result of those loans.”

Now it’s a closed factory. And it is increasingly embarrassing as new information comes out regarding the riskiness of the venture — and the access of Solyndra leaders to the White House. Two months before the loan was awarded, a corporate auditor warned that the company had enough financial problems to “raise substantial doubt about its ability to continue as a going concern.”

And the struggles of green industries elsewhere in the world were disregarded as the Obama administration, flush with stimulus funding, pushed headlong with its green jobs agenda. It seems no one accounted for Spain’s struggles in heavily subsidizing alternative energy technology and development. A well-publicized study from a Spanish university found that 2.2 jobs were lost for every green job created.

It is becoming increasingly apparent that Washington should have been extremely wary of Solyndra, and equally apparent that there was a full court press to simply make this loan happen.

More information is likely to be revealed with a House committee exploring the matter and, to the credit of Obama’s Justice Department, an FBI investigation that is under way as well.

We recall the outrage and relentless media coverage of the Bush administration when it was discovered that Vice President Dick Cheney had been having closed-door meetings with energy executives. There was a perception of shady dealmaking for the benefit of the energy industry.

Politics aside, the best policy is almost always full disclosure. That’s what we need now. There clearly was a direct and expensive subsidy to a single company, and surely some folks, including Solyndra executives and investors, made out well from it all. The Solyndra situation deserves every bit of attention it gets. Let the chips fall where they may.