Politics

House Subpoena Widens Probe of Federal 'Green Jobs' Boondoggle

By: Kenric Ward | Posted: November 4, 2011 3:55 AM
Solyndra installation in BelgiumLargest Solyndra installation in the world, located in Belgium.
Amid revelations that the Obama administration considered bailing out the solar company Solyndra, a House subcommittee on Thursday voted to subpoena White House records related to the failed firm's financial and political connections.

Rep. Cliff Stearns, R-Ocala, chairman of the House Energy and Commerce Oversight Subcommittee, said the subpoena was necessary because the White House is "slow-walking" all requests for information.

"We want to get to the bottom of this," Stearns said of the bankrupt company that took $528 million in federal loans down with it.

On the losing end of a party-line 14-9 vote, Democrats tried to block the subpoena.

The White House said it has "cooperated extensively with the committee's investigation by producing over 85,000 pages of documents, including 20,000 pages produced just [Wednesday] afternoon."

"And all of the materials that have been disclosed affirm what we said on day one: This was a merit-based decision made by the Department of Energy," White House spokesman Eric Schultz said.

But the inspector general's office that first raised concerns about the federal loan program used to finance Solyndra said the Energy Department was ill-equipped to quickly distribute billions of dollars in economic stimulus funding.

The Energy Department’s inspector general, Gregory H. Friedman, said Energy’s $35.2 billion in stimulus funding eclipsed its annual budget by $8 billion and placed strains on the federal, state and local officials responsible for distributing the funds, according to the Washington Post.

Friedman said the department failed to properly document and could not always demonstrate how it resolved or mitigated risks before granting loan guarantees, the Post reported.

Congressional Republicans began investigating Solyndra months before the California-based Solyndra filed for bankruptcy protection in September and laid off 1,100 workers.

But even amid revelations that federal officials warned of Solyndra's problems, President Obama visited the company and praised it publicly.

At the time, Obama boasted, "Companies like Solyndra are leading the way to a brighter, more prosperous future."

The administration's document dump on Wednesday revealed that it considered a bailout of Solyndra days before it collapsed.

The bailout would have provided an infusion of cash and a new board of directors, including two directors appointed by the Energy Department, Fox News reported.

Officials rejected the plan, which was recommended in August by the investment banking firm Lazard Ltd. Lazard was paid $1 million for analyzing options related to the faltering company, the Fox report said.

According to email records released Wednesday, the bailout plan considered by the Energy Department would have converted much of the U.S. loan to equity in the company worth as much as 40 percent.

Lazard was hired to look at Solyndra's financing after the company received a $528 million loan in 2009 and $69 million in private money earlier this year in a restructuring deal approved by the administration. Under the second deal, the private investors moved ahead of U.S. taxpayers in case of a default on the loan, a move that GOP investigators criticized.

Without an infusion of new cash, Lazard wrote in an Aug. 17 memo to the Energy Department, Solyndra was almost certain to fail, which would "likely result in little recovery to the DOE." The department rejected the refinancing plan sometime after Aug. 28, and Solyndra shut its doors on Aug. 31, the Fox report stated.

White House Chief of Staff Bill Daley announced last week that he had ordered an independent review of similar loans made by the Energy Department.

Stearns was unimpressed.

Comments (5)

Groscoe
9:10PM NOV 11TH 2011
Wind and Solar are tiny parts of what powers the country......Why?......They are not price competitive with fossil fuels.......

This country was founded on cheap energy and it helped provide the way for the U,S,A, to become the world's super power economically.

Since then politicians have worked to destroy our competitiveness.......first through free trade which was an invitation for US based companies to move their manufacturing facilities overseas and shipped the same goods here using cheap labor.....Second.....the companies left due to the highest tax rate the world......Third.......excessive regulation smothers companies.....And now.....subsidizing expensive power and blocking the use of fossil fuel.....
JOEL GOODMAN
9:00PM NOV 6TH 2011
IF THE COMPLETE TRUTH WERE EVER EXPOSED, OBAMA WOULD NOT BE IMPEACHED, HE'D BE LYNCHED.
Frank
11:41PM NOV 5TH 2011
Disappointing - not even the slightest mention that this was a Bush Presidency approved program. Of course not, this is not about the facts and failed venture capitalism, it's all political about let's get Obama.
Groscoe
9:12PM NOV 11TH 2011
Frank.......Get your facts straight Bud......The Bush administration was going to pull the plug on the request........stop reliving the last administration
JOEL GOODMAN
9:02PM NOV 6TH 2011
venture capital is put up by individuals and companies-NOT the federal government./never, ever,no way, no how .