Solyndra Could Be Obama’s Icarus Moment

Just when it appeared things couldn’t get much worse for President Obama, the Solyndra scandal reared its ugly head this month.

The California-based solar panel manufacturer filed for bankruptcy after pocketing a $528 million loan from the Department of Energy. Not only are taxpayers on the hook for the half-billion dollars, but it appears the Obama administration pressured the Office of Management and Budget to speed its loan review so Vice President Joe Biden could trumpet the company at a 2010 press event.

The White House clearly wanted to use Solyndra as a poster child for the clean-energy jobs the president promised as part of the 2009 economic stimulus package. Instead, it looks like Solyndra will become congressional Republicans’ poster child for wasteful government spending and a potentially major election-year headache for Obama.

That became clear last week when House Republicans – some of whom had lobbied Obama for similar DOE loans to companies in their own districts – moved to slash $100 million from the DOE loan program that funded the Solyndra deal.

Rep. Darrell Issa, the chairman of the House Oversight Committee and a fierce and formidable Obama critic, hosted a hearing Thursday he billed as “How Obama’s Green Energy Agenda Is Killing Jobs.” Ironically, Issa wrote to Energy Secretary Steven Chu to lobby for federal aid to electric-car maker Aptera Motors in California last year, claiming the firm would create jobs, according to the San Francisco Chronicle.

A spokesman for Issa told Bloomberg news the Aptera application – pending three years – was different from Solyndra’s. “In the entire time that Aptera’s application has been pending, Solyndra was able to obtain taxpayer backing and go bankrupt, leaving taxpayers on the hook,” Issa spokesman Frederick Hill told Bloomberg. “Most applicants for federal programs don’t, in fact, receive the VIP treatment Solyndra did.”

As a side note, conservative websites are having a field day with reports that George Kaiser, a major Solyndra investor and Obama fundraiser, in 2008 had a series of meetings at the White House around the same time the deal was being finalized.

The Solyndra debacle not only led to the demise of more than 1,000 American jobs, but it could also cripple the DOE loan program that aims to prop up the still-fledgling clean-energy industry.

Sen. Jeff Bingaman, the chairman of the Senate Energy and Natural Resources Committee, told me last week he wasn’t familiar with the Solyndra loan application before news of its bankruptcy blew up. But Bingaman defended the loan program. He said it’s ironic lawmakers who were blasting the loan program as too slow and tedious not long ago are now complaining that it moved too fast.

“As a general matter, both Democrats and Republicans have been complaining about the slow pace of dealing with these energy loan applications,” Bingaman said. “And there is great frustration on the part of the applicants who can’t get quicker action – that the government is being too careful and risk-averse.”

In the past few years, the DOE has dramatically boosted efforts to develop transformational – or “game changing” – energy technologies. This was the theory behind the 2007 congressional creation of the Advanced Research Projects Agency-Energy, or ARPA-E, and it is a driving force behind the DOE’s loan program. The idea is that government backing can inspire private-sector confidence in risky but potentially highly rewarding energy research and development.

“The loan guarantee program was set up to provide credit where commercial credit was not available and have the government take on some of the risk for some of these new technology ventures,” Bingaman said. “I think it was inevitable there were going to be some losses.

“The question is, overall, is the program creating jobs and developing technology and manufacturing capacity for the country that is important to have? I think it’s doing that but it’s still in its early stages.”

The New Mexico Democrat, who is retiring next year, pointed out that China and other countries are moving quickly to develop these technologies, often with huge government subsidies. Bingaman said he’ll be disappointed if the Solyndra debacle leads to the demise of the DOE loan program.

“I think it’s going to be very unfortunate if that’s the way it plays out,” Bingaman said. “The idea that we’re going to just get the government out of these areas is a recipe for just turning it all over to China and other foreign competitors.”

Meanwhile, Rep. Ben Ray Lujan, a New Mexico Democrat who is working to carve out a niche in the energy policymaking arena himself, said if Solyndra was a “bad actor” it should be punished. Solyndra execs pleaded the Fifth Amendment to congressional questions on Friday.

“If there is a bad actor out there in any sector – if anyone is trying to take advantage of the federal government – then we need to look at it,” Lujan said. “If there are criminals out there we need to go after them.”

E-mail: mcoleman@abqjournal.com. Go to www.ABQjournal.com/letters/new to submit a letter to the editor.