Yes, Mr. Kessler, there really is a crony capitalist in the White House

posted at 9:15 am on February 20, 2012 by Ed Morrissey

Glenn Kessler at the Washington Post normally does a pretty good job of fact-checking claims in politics, within the limitations of the fact-checking “science,” which are considerable.  Today he takes on claims from Mitt Romney that Barack Obama engages in crony capitalism, focusing on the auto bailout/bankruptcy and the Solyndra scandal.  Kessler takes a detailed look at both cases — and misses the point on both,  and ends up giving Romney one Pinocchio for the claim:

Obama has his work cut out for him trying to convince voters that his administration didn’t throw good money after bad, especially because internal documents suggest that the White House tried to make Solyndra look like a success despite clear signs of trouble. Still, Romney can’t assert as a matter of fact that the president practiced political favoritism in this case. He is better off saying there is “evidence” or “reason to believe” that crony capitalism occurred.

In terms of the “sweetheart deal” for the UAW, it’s fairly clear that the president gave precedence to the union and its blue collar members, who fared better than they would have been under Chapter 11. Meanwhile, scores of employees from the white-collar ranks are angry about cuts they had to accept. We won’t judge whether Obama’s stance was appropriate, but we can say that he came down on the side of the Democrat-friendly UAW.

Nonetheless, the auto bailouts have proven to be a success so far, and Romney has overstated whether his alternative approach would have been viable during an economic crisis, as we pointed out in a previous column. We’re also hard-pressed to think of a single president who hasn’t pandered to the traditional allies of his party — for Obama, this includes unions and environmentalists.

Overall, the former Massachusetts governor and Michigan native earns one Pinocchio, but mainly for accusing the president of crony capitalism in the matter of Solyndra. He doesn’t have definitive proof of Obama’s intentions, even if the evidence suggests continued grounds for suspicion.

Let’s start with the auto bailout and bankruptcy.  While it’s true that Presidents pander to their constituencies, that isn’t the objection in this case.  Obama used the leverage he created with the taxpayer bailout that he extended (George Bush initiated it, of course) to ignore the principles of bankruptcy.  Obama and his team violated the rights of senior creditors in favor of the unions in an unprecedented, politically-engineered bankruptcy.  That’s a lot different than proposing union-friendly legislation or granting new access to federal work forces, both of which Obama has also done.

Despite Kessler’s lengthy explanation on Solyndra, he leaves out a couple of key facts.  One, Department of Energy auditors raised red flags about Solyndra when processing the loan request in early 2009, a request that the Bush-era DoE had declined for the same reasons.  Energy Secretary Stephen Chu overrode those concerns, and then granted Solyndra an interest rate somewhere between a quarter and a third of the going rate for taxpayer-guaranteed loans.  When Solyndra began to fail, the same warnings were issued, but the Obama administration doubled down by restructuring the loan and subordinating taxpayer risk to that of George Kaiser — the Obama bundler who stood to benefit from a Solyndra success story.

In both cases, it might be hard to “prove” Obama’s intentions, but actions speak louder than words.


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because internal documents suggest that the White House tried to make Solyndra look like a success despite clear signs of trouble.

lipstick on a pig, still a pig…you get the drift.

ted c on February 20, 2012 at 9:18 AM

venture capitalist-in-chief and abject failure as well

thedevilinside on February 20, 2012 at 9:21 AM

Overall, the former Massachusetts governor and Michigan native earns one Pinocchio, but mainly for accusing the president of crony capitalism in the matter of Solyndra. He doesn’t have definitive proof of Obama’s intentions, even if the evidence suggests continued grounds for suspicion.

Wait a second, Pinocchio got a large nose because of lying, not for accusing. The President ought to be earning a nose for stating that Solyndra was viable and doing their damndest to make it look like it was, when it really wasn’t. That is definitive proof of Obama’s intentions, he intended to put lipstick on the Solyndra pig, but they really shoulda stuck a fork in that pig because, despite all the good intentions, she was done for.

ted c on February 20, 2012 at 9:23 AM

One Pinocchio for stating the obvious in the mildest terms possible. Remember when directing large sums of money directly to friends was called “corruption” “graft” kick backs” etc. Now it’s “crony capitalism” – whatever.

The MSM can’t help themselves reflexively flacking for Obama. Just this morning a 30 second ABC news blurb on rising gas prices started and ended with assurances that the president has no control over gas prices. They started making the excuses before even getting to any of the facts and finished with more excuses in case anyone forgot in the intervening 15 seconds that it’s totally not the president’s fault.

forest on February 20, 2012 at 9:23 AM

Does this qualify for a pinocchio for Kessler?

DumboTheAvenger on February 20, 2012 at 9:24 AM

focusing on the auto bailout/bankruptcy
========================================

Bailout Recipients
Last update: Feb. 10, 2012

We’re tracking where taxpayer money has gone in the ongoing bailout of the financial system. Our database accounts for both the broader $700 billion bill and the separate bailout of Fannie Mae and Freddie Mac (go here for the Federal Reserve’s emergency loans to banks).
**************************

General Motors Auto Company

Amount committed $23 B returned / $51 B disbursed

Revenue to Gov’t……$694 M

http://projects.propublica.org/bailout/list

canopfor on February 20, 2012 at 9:25 AM

MARXISM.

bgibbs1000 on February 20, 2012 at 9:27 AM

The MSM can’t help themselves reflexively flacking for Obama. Just this morning a 30 second ABC news blurb on rising gas prices started and ended with assurances that the president has no control over gas prices.

forest on February 20, 2012 at 9:23 AM

But he does have control over killing the Keystone pipeline, restricting domestic energy exploration, and imposing unaffordable EPA standards that are forcing the shutdown of refineries and coal plants. The Republicans need only repeat this ad nauseum between now and November. Obama can spin all he wants, but he can’t run away from that record.

Doughboy on February 20, 2012 at 9:29 AM

It depends on what the definition of ‘IS’…is!
Can you imagine JugEars, with Pinocchio’s nose?

KOOLAID2 on February 20, 2012 at 9:30 AM

actions speak louder than words…

You think?

Roy Rogers on February 20, 2012 at 9:30 AM

MARXISM.

bgibbs1000 on February 20, 2012 at 9:27 AM

Socialist/Marxist/Capitalist? you guys are so confused.

residentblue on February 20, 2012 at 9:41 AM

Obama is a corrupt influence seller.

However, conservatives preserve credibility if they make sure the facts are straight. Didn’t Kaiser put in more money at the time his investment received priority over the taxpayer funding? If so, and if it was only the late money that got priority, then that part of the story is not very fishy. (Plenty of stench remains, of course.)

IndyinVirginny on February 20, 2012 at 9:47 AM

We won’t judge whether Obama’s stance was appropriate, but we can say that he came down on the side of the Democrat-friendly UAW.

You won’t judge??? WTF. Oh, that’s right, we’re talking about your “you complete me” Obooboo.

msupertas on February 20, 2012 at 9:49 AM

Socialist/Marxist/Capitalist? you guys are so confused.

residentblue on February 20, 2012 at 9:41 AM

I think Failure ties it up in a neat little package, don’t you?

thedevilinside on February 20, 2012 at 9:50 AM

I’m not sure I would term Obama a crony capitalist but when the “fact” checker deserves a pinocchio there is something seriously wrong.
I love the fact that Romney is going after Obama but he needs full force. Solyndra is bad but small preanuts in the big picture.

ORconservative on February 20, 2012 at 9:52 AM

In both cases, it might be hard to “prove” Obama’s intentions, but actions speak louder than words.

Dead on as usual Captain.

These words also rang true when I was reading this today.

….well first..this is what Obama promised…his “intentions”:


I will . . . finish the fight against al-Qaida and the Taliban in Afghanistan.

Barack Obama


Mr. Obama has said that a stable Afghanistan is central to the security of the United States,

Obama Considers Strategy Shift in Afghan War
NY Times, Sept. 22, 2009

“We need to finish the fight in Afghanistan… George Bush and John McCain have been weak on terrorism. It’s time to finish the fight in Afghanistan.”

Barack Obama
2008 Presidential Campaigning

….and what are Obama’s “actions”:

(via Gatewaypundit)
Thanks Barack… Top Taliban Leader: “US-Taliban Talks Reveal America’s Failure in Afghanistan”
Posted by Jim Hoft on Monday, February 20, 2012, 7:37 AM
http://www.thegatewaypundit.com/2012/02/thanks-barack-top-taliban-leader-us-taliban-talks-reveal-americas-failure-in-afghanistan/

Pakistan’s Tehrik-i-Taliban’s leader Waliur-Rehman Mehsud told Press TV that Washington has sought to launch peace talks with the Afghan Taliban over the US failure in Afghanistan.

Mehsud added that the US-led invasion of Afghanistan was initially aimed at eliminating the Taliban militants or making them surrender.

However, he said, the foreign forces’ failure to do so has forced Washington into a negotiating position.

So just like Obama takes American’s hard earned money in the name of “social justice” to subsidize his campaign..to fill the pockets of his bundler’s…..and to buy votes from the electorate in the guise of “looking out for the folks”….

………………..Obama “talked” of having a “superior plan” in Afghanistan….winning the fight because Bush was to “weak” on terror….evoking “smart power” to beat the Taliban/al-qaeda…..

……….his “action” have been nothing more than trophy hunting with drones….declaring the Taliban “not our enemy”….and surrendering Afghanistan to the jihadist who now will be stronger than when we came in 2001.

Obama’s “actions”…his “results” never,ever meet up to the words and promises he so boldly pronounces.

Baxter Greene on February 20, 2012 at 9:54 AM

Despite Kessler’s lengthy explanation on Solyndra, he leaves out a couple of key facts.

He made it lengthy with the hope that the omissions would be unnoticed.

itsnotaboutme on February 20, 2012 at 10:00 AM

crony capitalism –> corruption, can we be truthful on this ?

and Frank Luntz agrees.

williampeck1958 on February 20, 2012 at 10:03 AM

Doughboy on February 20, 2012 at 9:29 AM

Strangely, ABC didn’t mention any of that stuff.

forest on February 20, 2012 at 10:06 AM

residentblue on February 20, 2012 at 9:41 AM

So many apply, take for instance in your case, denial. Could also be, abnegation, or even projection. Or perhaps one might go with disavowal. You see how that works. Many descriptives can be used all equally correct. You got it?

Bmore on February 20, 2012 at 10:06 AM

The MSM can’t help themselves reflexively flacking for Obama. Just this morning a 30 second ABC news blurb on rising gas prices started and ended with assurances that the president has no control over gas prices.

forest on February 20, 2012 at 9:23 AM

Funny that, because George Bush had control over gas prices, and he proved it. In 2008 we saw gas prices approach $4 a gallon. Bush lifted the moratorium on off-shore drilling and gas prices dropped almost over night, levelling off at $1.84 the day Obama took office. But Obama….Nooooo, he has no control over gasoline prices!

Trafalgar on February 20, 2012 at 10:09 AM

Socialist/Marxist/Capitalist? you guys are so confused.

P.S. Capitalist, not even a poor one. He would have to believe in it first. 0 doesn’t.

Bmore on February 20, 2012 at 10:11 AM

The MSM will always find a way to rationalize corruption in a Democratic Administration.

Too many people in the GOP don’t get that the MSM is a constituent group of the Party.

The Romney people least of all.

victor82 on February 20, 2012 at 10:11 AM

As a lefty friend of mine says “That was then, this is now”.
Pretty much sums it up.

GinSC on February 20, 2012 at 10:13 AM

See, once again, the press is trying to make progressivism seem less radical than it really is. Why? Well, of course, because if people really know what it is, they won’t want it.

It would be much more honest to say Obama believes strongly in the green energy market, largely because it may prove to be the path forward but also in part because it supports traditional political allies. He selected Solyndra for public funding because it represents both of these factors.

It is also likely true that the green energy agenda was in part behind the bailout for GM as a quick and massive infusion of cash could help jumpstart the fledgling American electric car market. The structuring of the deal to wipe out bondholders and build up the unions was a blatant political move.

So in both cases, it was clearly crony capitalism. Why WaPo feels it needs to cover Obama on this is curious and can only mean that if voters knew the details, they would likely be turned off by either the practice or the substance. Which by it’s very nature, makes it un-American.

BKeyser on February 20, 2012 at 10:14 AM

It would be delicious if the GOP could use a Monty Python clip (as if) to illustrate the “dead-parrot economy” (h/t:Mark Steyn). The perfect metaphor.

~(Ä)~

Karl Magnus on February 20, 2012 at 10:16 AM

I was confused by the headline; I think it detracted from the point more than added: “Yes [Virginia/Mr. Kessler]…there is a Crony Capitalist in the WH.” I’m sure Ed did not want to say, “Be reassured, if you embrace your imagination, there is a heartening way to reckon that Cronyism indeed lives (but wink, wink, it doesn’t exist the way most people think of “reality”). The point Ed wants to say is the opposite: The hard reality of Obama is cronyism/corruption; it is wishful to think otherwise.

G. Charles on February 20, 2012 at 10:21 AM

Let’s not let the Liberals win this word battle. It’s not crony capitalism it is socialism. It is a system that rewards those in political favor and that is collectivism at it’s heart. There is no capitalism here.

jukin3 on February 20, 2012 at 10:25 AM

In criminal court the standard of evidence is beyond a reasonable doubt (which ignorant jurors think mean no doubt). In civil court the standard is preponderance of evidence, which means likelyhood. In politics the standard changes if you’re Republican or conservative.

InterestedObserver on February 20, 2012 at 10:38 AM

i am not sticking up for obama admin but it is false that they violated the priority rights of the secured creditors in bankruptcy. while the admin put undue and unprecedented pressure on those creditors they voluntarily relinquished their rights. again what obama long ago figured out is that if nobody actually resists you you can do anything you want. the so called reces appointments the contraception mandate and so on are examples od this tactic.

casel21 on February 20, 2012 at 10:40 AM

Thomas Sowell had a three-part series on Progressivism. Which of our GOP contenders falls into this trap of the “progressives” in terms of interfering with the economy and picking winners and losers in the marketplace?

http://townhall.com/columnists/thomassowell/2012/02/15/the_progressive_legacy_part_ii/page/full/

onlineanalyst on February 20, 2012 at 10:47 AM

Weakish arguments, weaker conclusion. This guy started strong and fizzled by the end.

jeanie on February 20, 2012 at 11:08 AM

Another fine example by the WAPO and croney journalism

Sparty on February 20, 2012 at 11:16 AM

In criminal court cases it is always difficult to establish with absolute certainty for the jury a defendant’s intent. That is why a jury may infer intent from the actions of the defendant.

skatz51 on February 20, 2012 at 11:17 AM

Politically, Obamacare’s great ‘change’ is that it gives politicians and bureaucrats unbridled control over insurance premium dollars, adding vast new sums of money to funnel toward their cronies on top of what tax revenues already provide.

Obama is at this very moment demonstrating to his elite cronies how it is going to be done. He is using health-insurance-premium-payers money to funnel political favor and power toward elite “feminist leaders”.

It is going to get far, far worse. Under the rubric of “preventative care” billions upon billions of dollars of tax-payer and now premium-payer money will be going to Democrat cronies of all flavors.

And much of what progressive politicians, bureaucrats and judges will deem “preventative care” will be related to health care only in their fevered money-drunk, rationalizations.

DrDeano on February 20, 2012 at 11:35 AM

case21: “i am not sticking up for obama admin but it is false that they violated the priority rights of the secured creditors in bankruptcy. while the admin put undue and unprecedented pressure on those creditors they voluntarily relinquished their rights”.

If someone with great power over you literally or figuratively puts a gun to your head insisting you relinquish your rights as they demand, and you do so, your are not “voluntarily” relinquishing those rights.

Also, I agree with your observation that: “what obama long ago figured out is that if nobody actually resists you you can do anything you want.”

Obama is a bully and that is exactly how bully’s function.

DrDeano on February 20, 2012 at 12:00 PM

He doesn’t have definitive proof of Obama’s intentions, even if the evidence suggests continued grounds for suspicion.

-
So are we now going for ‘beyond a shadow of a doubt’ before a politician’s half a billion dollar walking around money move(s) can be pointed out?
-
BTW… I love the ‘well you caught him here, almost caught him here, but didn’t really catch him here’ feel of Kessler’s analysis. Paints Obarry as a sneak and a thief.
-

RalphyBoy on February 20, 2012 at 12:06 PM

Kessler is not only blind. He’s stupid. Just another Obamalama apologist.

GarandFan on February 20, 2012 at 12:27 PM

“We won’t judge whether Obama’s stance was appropriate, but we can say that he came down on the side of the Democrat-friendly UAW.”

We wouldn’t want a Post writer daring to stick his neck out with a criticism of Barry, would we? I don’t seem to recall the Post being hesitant to judge Bush.

Colony14 on February 20, 2012 at 1:59 PM

In terms of the “sweetheart deal” for the UAW, it’s fairly clear that the president gave precedence to the union and its blue collar members, who fared better than they would have been under Chapter 11.

General Motors will eventually be back in trouble again in the next few years. The systemic problems that resulted in GM’s bankruptcy are still in place and will eventually lead GM to return to the government teat. Market forces can’t resolve the problems when the government keeps interceding. Just like Amtrak, the taxpayers will be on the hook for GM forever.

TulsAmerican on February 20, 2012 at 3:10 PM

In terms of the “sweetheart deal” for the UAW, it’s fairly clear that the president gave precedence to the union and its blue collar members, who fared better than they would have been under Chapter 11.

General Motors will eventually be back in trouble again in the next few years. The systemic problems that resulted in GM’s bankruptcy are still in place and will eventually lead GM to return to the government teat. Market forces can’t resolve the problems when the government keeps interceding. Just like Amtrak, the taxpayers will be on the hook for GM forever.

TulsAmerican on February 20, 2012 at 3:10 PM

Yes, and the root of that systemic problem is the greedy UAW. Until the UAW is thrown on the trash heap of American history, American auto manufacturing will not survive.

slickwillie2001 on February 20, 2012 at 3:36 PM

The Obama administration, for its part, says there is no basis for the crony capitalism claims.

There you go, clearly the accusation is false; the accused says he didn’t do it… what more do you need to know how innocent he is?

gekkobear on February 20, 2012 at 6:42 PM