CBS: Obama admin spent $6.5 billion on risky green-tech ventures; Update: Obama proposes to save less than half in org consolidation
posted at 11:54 am on January 13, 2012 by Ed Morrissey
We already know that the Obama administration’s stimulus-funded subsidies of green-energy firms have been rather poor investments. Solyndra, after all, collapsed while taking over half a billion dollars in taxpayer money with it, after the Department of Energy illegally subordinated taxpayer risk for later investors — mainly an Obama bundler from 2008, George Kaiser. CBS News’ Sharyl Attkisson takes a break from reporting on Operation Fast and Furious to give a closer look at the performance of Barack Obama’s bets in the green-tech sector — and says that Obama bet more than $6.5 billion of taxpayer money in junk bonds:
Asked whether he’d put his personal money into Beacon, economist Peter Morici replied, “Not on purpose.”
“It’s, it is a junk bond,” Morici said. “But it’s not even a good junk bond. It’s well below investment grade.”
Was the Energy Department investing tax dollars in something that’s not even a good junk bond? Morici says yes.
“This level of bond has about a 70 percent chance of failing in the long term,” he said.
In fact, Beacon did go bankrupt two months ago and it’s unclear whether taxpayers will get all their money back. And the feds made other loans when public documents indicate they should have known they could be throwing good money after bad.
It’s been four months since the FBI raided bankrupt Solyndra. It received a half-billion in tax dollars and became a political lightning rod, with Republicans claiming it was a politically motivated investment.
CBS News counted 12 clean energy companies that are having trouble after collectively being approved for more than $6.5 billion in federal assistance. Five have filed for bankruptcy: The junk bond-rated Beacon, Evergreen Solar, SpectraWatt, AES’ subsidiary Eastern Energy and Solyndra.
I’m pretty sure Atkisson will be getting another screaming, expletive-laden phone call from the White House any time now. After all, the meme of the day for the Obama administration is reform — which led to this ironic juxtaposition on the CBS website:
Update: Obama wants to save money by merging six government agencies that duplicate efforts, but it comes to less than half of what Obama has put at risk:
President Obama said on Friday he will ask Congress for the authority to shrink the size of the federal government by merging six agencies. Each agency handles aspects of trade and commerce, and Obama made the case that the overlap in responsibilities causes confusion for American businesses and consumers.
But Obama will need approval from Congress to do so and he urged lawmakers to act. “This should not be a partisan issue,” he told an East Room audience.
Jake Tapper noted on Twitter that the proposed savings, $3 billion, is one-four-hundredth of the debt limit increase he just requested from Congress. It’s also less than half of what Obama tossed away on his supposed green-tech jobs stimulus. Mitch McConnell laughs at the irony of a President who has spent the last three years expanding government attempting to blame Congress for not reducing it:
But a spokesman for Senate Minority Leader Mitch McConnell, R-Ky., was quick to respond with little enthusiasm.
“After presiding over one of the largest expansions of government in history, and a year after raising the issue in his last State of the Union, it’s interesting to see the president finally acknowledge that Washington is out of control,” said spokesman Don Stewart.
“And while we first learned of this proposal this morning in the press, we’ll be sure to give it a careful review once the White House provides us with the details of what it is he wants to do.”
I’m all for reducing duplication and inefficiency, whether it’s in the public or private sector. At least in the private sector, though, I don’t have to put my own money at risk in bad investments, while clearly Obama wants to do that with our money for his own purposes.