Energy Department loses a casual $42 million on failed loan to green van company, no big deal

posted at 8:01 pm on September 9, 2013 by Erika Johnsen

I know the general focus of the news cycle right about now is largely occupied with the unfolding foreign-policy drama of the debacle in Syria, but never fear — the many moving parts of the federal government are still busily toiling away with their relentless penchants for stupendous errors and inefficiencies, and the Department of Energy just got some sweet news about yet another project in government venture socialism. Yet another of the beneficiaries of their ghastly loan guarantee program has made it to the end of the line, and not in a good way:

The Energy Department said Friday it will lose about $42 million on a loan to a now-shuttered Michigan company that made vans for the disabled.

Vehicle Production Group, or VPG, suspended operations in February and laid off 100 workers. The company had paid back $5 million of a $50 million federal loan this spring, and the remainder of its debt was sold at auction this week to Humvee manufacturer AM General, which paid $3 million to buy the Energy Department loan.

VPG, of Allen Park, Mich., received a federal loan in 2011 under the same clean-energy program that provided a $529 million loan to electric car maker Fisker Automotive Inc. Fisker had received $192 million before a series of problems led U.S. officials to freeze the loan in 2011. The Obama administration has seized about $28 million from California-based Fisker, which has laid off three-fourths of its workers. …

‘‘After exhausting any realistic possibility for a sale that might have protected our entire investment, the department determined that auctioning the remainder of VPG’s loan obligation offered the best possible recovery for the taxpayer,’’ spokesman Bill Gibbons said in an email.

One of the most galling bits of the DOE’s loan program, however, isn’t merely that the DOE is frivolously throwing around taxpayer money in what they refer to as “investing” (when they’re actually just propping up their preferred projects based on romanticized ideology rather than competitive merit), but also that their doing so affords them so many conveniently concealable opportunities to funnel said taxpayer money to generous Democratic donors. Crony capitalism, for the win! Via the WFB:

DOE’s relationship with VPG came under scrutiny in 2011 after it was revealed that James Johnson, the former top executive at federal mortgage giant Fannie Mae and a major Obama fundraiser, chaired an investment firm, Perseus LLC, with a stake in the company.

Johnson bundled between $200,000 and $500,000 for Obama’s 2008 campaign. His financial support for Obama dates back to 2003, when he donated $1,000 to his U.S. Senate campaign.

Johnson helped Obama court Clinton supporters in 2008 after a bloody Democratic primary.

He also sat on a three-person vice presidential selection panel for the campaign, though he stepped down after it was revealed that he received sweetheart mortgages from predatory lender Countywide Financial.

Both Perseus and DOE have denied that federal financing for VPG was political in nature.

Yes, because I’m sure such a thing has never even been heard of among The Most Transparent Administration, Evah.


Related Posts:

Breaking on Hot Air

Blowback

Note from Hot Air management: This section is for comments from Hot Air's community of registered readers. Please don't assume that Hot Air management agrees with or otherwise endorses any particular comment just because we let it stand. A reminder: Anyone who fails to comply with our terms of use may lose their posting privilege.

Trackbacks/Pings

Trackback URL

Comments

OOF!

workingclass artist on September 9, 2013 at 8:18 PM

I didn’t see the debt clock budge?

But hey, that’s chump change. We wasted 4x that much on a choo-choo train here in Tuscon that runs 4 miles from nowhere to nowhere.

The “modern streetcar” got its first test today,,, by being dragged down the tracks by a towtruck…

wolly4321 on September 9, 2013 at 8:20 PM

I know the general focus of the news cycle right about now is largely occupied with the unfolding foreign-policy drama of the debacle in Syria,
==================

D*mmit Erika,your O/Topic!!

(KIDDING):)

canopfor on September 9, 2013 at 8:24 PM

There seems to be a NeverEnding Waste of Americasn taxpayer lootery!!

canopfor on September 9, 2013 at 8:25 PM

Besides, we can afford it. Putin sequestered our Tomahawks saving us all that money.

wolly4321 on September 9, 2013 at 8:29 PM

$42 million? My goodness. There goes Michelle’s next vacation money…

Don L on September 9, 2013 at 8:35 PM

Oh come on! It all went to Area 51! Hasn`t anyone seen “Independence Day?!” :)

ThePrez on September 9, 2013 at 8:37 PM

You know, when you work for a small company whose annual income is a fraction of one of these loans, and yet you realize you helped pay for them, it breaks your heart. Corrupt jerks.

WitchDoctor on September 9, 2013 at 8:37 PM

We’ll only ever be able to put a significant dent in the systemic corruption of government at all levels — nothing will ever completely stop it — with an appropriate disincentive: make any and even the slightest abuse of the public trust (including your basic political favor and for parties on both sides) a capital offense.

Put the executions on Pay-Per-View and use the revenue to start paying down the impossible-to-ever-eliminate government debts.

ShainS on September 9, 2013 at 8:37 PM

Both Perseus and DOE have denied that federal financing for VPG was political in nature.

Of course it wasn’t! They’ll stake their credibility on it!

As soon as they can find it.

GarandFan on September 9, 2013 at 8:37 PM

I’ll take $42 million to paint vans green!

And achieve more than the company ever did, too.

Cheaper at twice the price, I say.

ajacksonian on September 9, 2013 at 8:39 PM

OK Folks…Sell the Trains – Obama

workingclass artist on September 9, 2013 at 8:41 PM

Meh. We saved that much by canceling one F-22.

/The One’s “logic”

The way this administration pumps taxpayers’ money into “deep green” scams would have the MSM calling for a Republican president’s head. Regardless of what the money was spent on, and even without the kickbacks. This isn’t just illegal and irresponsible. It’s also delusional.

But those three words have been the hallmarks of this entire regime’. So it’s also business as usual.

clear ether

eon

eon on September 9, 2013 at 8:44 PM

You know, when any individual in his/her personal life makes an investment, they are accountable for their actions. If they personally lose 42 million, they are broke, homeless, bankrupt, but the government doesn’t care about dumb investments, meaning ones that they know will fail,because IT”S NOT THEIR MONEY. We as taxpayers need to hold these frivolous fools accountable for losses of our hard earned money. They need to suffer dire consequences for stupid investments. On the other hand, they should be rewarded for making good decisions, and investments, just as if they were running a business.

F_This on September 9, 2013 at 8:53 PM

On a side note, don’t come to me for any more money you stupid, frivolous idiots.

F_This on September 9, 2013 at 8:55 PM

All I want to know is where can I pick up a DOE loan application? I can default on a $50 million load much more efficiently than most “green” companies. Heck, I can do it for $49.5 million.

RoadRunner on September 9, 2013 at 10:32 PM