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Did the White House Fast-Track Solyndra’s Loan?

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The White House is bracing for criticism. Solyndra, a California-based Silicon Valley company which had hoped to take advantage of a new and developing market for solar panels, is now declaring bankruptcy. Solyndra sought and received a loan guarantee of $500 million from the Department of Energy loan office, in collaboration with the White House budget office. The application came from Solyndra late in the administration of George W. Bush, and received final approval in the spring of 2009, the first year of Barack Obama’s term.  Solyndra, which sustains relatively high production costs, failed to foresee that Chinese companies would flood the market, and that such competition would lower the price of solar equipment. An additional factor in the company’s failure was diminishing demand for solar panels in Europe.

Those who criticize the failed loan blame the White House, and suggest that the approval was hastened to provide an opportunity for Vice President Joe Biden to announce the loan’s approval at a publicized groundbreaking two years ago. The government agencies involved have defended their decisions, saying the application was carefully reviewed, and the loan approval was not politically motivated. The White House was spotlighting clean technology when the loan was approved, and had praised Solyndra and a total of 22 specific companies, many of which the president had personally visited.

Critics of the president point to emails in August of 2009. At that time, the Department of Energy (DOE) had tentatively approved the loan, but was awaiting a final financial review by the Office of Management and Budget (OMB). The emails show White House officials asking for a firm date when the final decision might be made. The OMB complained they were being rushed and needed adequate time to assess the risk. One email from an OMB official states that that office needed “time to negotiate.” A spokesman for the White House, Eric Schultz, said, “There was interest in when a decision would be made because of its impact on whether an event involving the vice president could be scheduled for a particular date or not, but the loan guarantee decision was merit-based and made by career staffers at DOE.”

Obama’s Department of Energy has repeatedly asserted that Solyndra was well on its way to receiving the loan during the final years of the G.W. Bush administration. Jonathan Silver, the executive director of energy loan programs said, “In fact, by the time the Obama administration took office in late January 2009, the loan program’s staff had already established a goal of, and timeline for, issuing the company a conditional loan guarantee commitment in March 2009.” The stimulus package had just passed Congress, and this loan was the first of many guaranteed by the DOE under a program created by a 2005 energy law.

However, Rep. Cliff Stearns (R-FL), chairman of the Energy and Commerce Subcommittee on Oversight and Investigations, said Silver was wrong to call the loan “a train about to leave the station” when Obama took office. Stearns insisted, “Only after the Obama administration took control, and the stimulus passed, was the Solyndra deal pushed through.”

Jeffrey D. Zients, deputy director for management at the White House budget office, said that during the Bush and Obama administrations, 36 loan applications had been considered, not only for solar projects, but also for wind and geothermal energy harnessing firms. The evaluation of these loans is ongoing and Zients concluded, “We have reason to be optimistic that the portfolio as a whole will perform.”

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About John Lake

John Lake had a long and successful career in legitimate and musical theater. He moved up into work behind the camera at top motion pictures. He has done a smattering of radio, and television John joined the Blogcritics field of writers owing to a passion for the liberal press, himself speaking out about the political front, and liberal issues. Now the retired Mr. Lake has entered the field of motion picture, television, and video game (now a daily gamer!) critique. His writing is always innovative and immensely readable!
  • Cannonshop

    Apparently, there’s big-donor-bundlers like George Kaiser involved in this too.

    but the failure, even without allegations of political corruption, was predictable-Solyndra wasn’t seen by most private-sector investors as a good bet, their technology and methods were already outdated before the groundbreaking.

    What’s funny, is that the DoD has been buying a LOT of Solar power equipment-and picking winners somewhat better than the Obama administration.

    Which is kind of scary-when the gilded princes of the Puzzle Palace (aka Pentagon) are better at demonstrating pragmatic frugality (with their reputation for the #50,000 hammers) than “The smartest guys in the room”, that’s a scary thought.

  • best

    Our nation has been DOWNGRADED!!!! Thick headed reps. and more spending. DOWNGRADED FIRST TIME IN HISTORY.

    We have seen what hair brained ideas they have come up with and now we are throwing money we don’t have across the seas.

  • Igor

    Where were all those smart-ass Goldman-Sachs financial guys who we´ve always been told are so smart that we just have to do what they say? Where was Geithner, Summers, etc.?

  • Pete

    The goverment should be more supportive for project like this. The sun can give us free energy.

  • Igor

    Pete: yes, the government SHOULD support good solar projects, but this was not a good one. On the other hand, it wasn´t much money as far as government projects go, just look at the typical DoD screwup.

    We need more people with training and experience in science, engineering and math in high places in the government. But even when we talk about training more people in science it’s for the purpose of getting cheaper replacement troops for the techno-slaves in industrial cubicles throughout the industrial empire, not for creating better decision makers in government.

    Look at the poor quality of even general decision-makers among our politicians, for example this raving idiot Todd Aikin in Missouri. And he wants to become a US senator, one of only 100 in that select outfit. Even worse, there are actually people who will support him and vote for him!

    Solyndra looks like a pretty inconsequential mess compared to Todd Aikin.

  • John Lake

    Pete:
    I’m curious. A quick review suggests you are Australian, with Swedish as your language of choice.
    Your comment suggests you aren’t terribly interested in the matter, just tossing off a quick remark. What up?