“Solyndra’s failure doesn’t discredit the entire idea of a green energy economy, but some might take it as a sign of the Obama administration’s incompetence”
Investor’s Business Daily digs deeper into the Solyndra scandal.
As the solar panel maker teetered on the brink early this year, the White House OK’d a restructuring giving private creditors the first $75 million, before taxpayers, in any Solyndra liquidation.
That was over objections by the White House’s Office of Man agement and Budget that the deal would put taxpayer funds at risk, according to emails revealed during a House Energy and Commerce Committee hearing.
“(T)he company may avoid a default with a restructuring, (but) there is also a good chance it will not,” an OMB staffer wrote Jan. 31. “Questions will be asked.”
Solyndra declared bankruptcy Aug. 31, putting 1,100 out of work and potentially leaving taxpayers on the hook for $527 million.
George Kaiser, Solyndra’s chief investor,was a top 2008 fundraiser for Obama and met with White House officials in 2009 as the loan was in the approval process.
Republicans argued that the restructuring violated Energy Department rules that loan guarantees must “not be subordinate to the other financing.” In other words, taxpayers come first.
Republicans zeroed in on the change at Wednesday’s hearing.
“Why did the DOE allow Solyndra’s investors to be first in line to recover ahead of the taxpayers?” asked Rep. Phil Gingrey , R-Ga.
Jonathan Silver, DOE’s top loan officer, told the panel that the administration “needed to ensure we have all of the tools necessary to secure the taxpayer’s interest.”
OMB emails indicate a fear that without giving other investors first crack, Solyndra couldn’t attract new capital and would fail.
