Yep: Bankrupt Obama-stimulus recipient goes to the highest bidder, the highest bidder being China
posted at 10:41 am on December 10, 2012 by Erika Johnsen
Let me get my obligatory free-trade qualifier out of the way here first: It’s not so much that there’s anything at all wrong with businesses buying and selling on the international arena, because foreign markets may have demands for products we don’t, and we all stand to make money off of one another in a mutually beneficial and productive way. Free-trade is not a zero-sum game, and everybody wins.
The problem here is that in the case of A123 Systems, a manufacturer of lithium-ion batteries for electric cards, the Obama administration spoon-fed hundreds of millions of dollars of taxpayer money into what they assured us was a guaranteed-successful endeavor at ushering in the glorious green-energy revolution and leading us down the path of ostensibly necessary energy independence. Not only has President Obama’s “investment” failed to inspire a dearth of American-made electric car-buying (which has also been very generously subsidized, courtesy of the taxpayer), but it’s brought us no closer to the energy self-sufficiency at which President Obama constantly suggests he’d like us to arrive.
The Washington Post reports:
Wanxiang America, the U.S. arm of a Chinese automotive parts giant, won the bidding for a bankrupt Massachusetts-based lithium battery manufacturer that was once hailed as a cornerstone of President Obama’s quest for American dominance in electric vehicles and battery technology.
A123 Systems announced Sunday that Wanxiang would pay $256.6 million for all of A123’s technology, its manufacturing facilities in the United States and China, and its contracts with utilities seeking grid storage and automakers seeking batteries for electric and hybrid vehicles. …
Wanxiang would not acquire A123’s Ann Arbor, Mich.-based government business, which includes all of its U.S. military contracts. Those would be acquired for $2.25 million by Navitas Systems, a Woodridge, Ill.-based provider of energy storage products for commercial, industrial and government agency customers.
True that the A123′s Michigan plant will remain open, but what we’ve essentially accomplished here is borrowing money from the Chinese, to build a company at a loss, to then sell it to the Chinese. And hey, I thought President Obama was an opponent of offshoring on principle? How is it not an intellectual inconsistency that it’s not okay when American businesses make use of international labor markets, but it’s fine and dandy when foreign-owned businesses set up shop here? Could it be that the door actually does swing both ways?
If these renewable energies into which President Obama so magnanimously gifts our money have a shot at success, the free market won’t ignore them — the federal government needs to stop playing political games with its romantical notions of venture-socialism. All appeals to logic and reason aside, don’t expect the madness to stop anytime soon:
President Obama travels to Detroit today to talk about the need for increased taxes on top earners to finance federal spending, and is using an announcement of a $100 million investment from German auto giant Daimler to illustrate that his economic prescription is working.
Obama is not likely to discuss another big business story of the day – the sale of the assets of battery maker A123 to a Chinese competitor. A123 spent at least $132 million of its $249 million stimulus package grant to build two Detroit-area factories, including one in Livonia, right next door to Redford Township, where Obama is speaking today.
Assuming a bankruptcy judge and the Obama Treasury Department approve of the sale of A123’s assets to Wanxiang Group, the Chinese battery maker would immediately become the dominant force in the industry.
Breaking on Hot Air