Stop me if you’ve heard this before. An administration walks into Congress and insists on billions of dollars to “invest” in green-tech startups, then loses its shirt on bad bets — even while knowing the bets were bad. If that sounds like Solyndra, well, you’re right — but it’s also part of a pattern in which Barack Obama and the White House have treated taxpayer funds like Monopoly money. CBS and the AP unveil the latest example of this pattern, Fisker Automotive, which continued to get millions in taxpayer funds even while failing to meet the conditions of its loan:
Newly obtained documents show the Obama administration was warned as early as 2010 that electric car maker Fisker Automotive Inc. was not meeting milestones set up for a half-billion dollar government loan, nearly a year before U.S. officials froze the loan after questions were raised about the company’s statements.
An Energy Department official said in a June 2010 email that Fisker’s bid to draw on the federal loan may be jeopardized for failure to meet goals established by the department.
Despite that warning, Fisker continued to receive money until June 2011, when the DOE halted further funding. The agency did so after Fisker presented new information that called into question whether key milestones — including the launch of the company’s signature, $100,000 Karma hybrid — had been achieved, according to a credit report prepared by the Energy Department.
Some may wonder what will happen to all of the American manufacturing jobs that the loans helped create. On that score, we don’t need to worry … because all of that cash didn’t produce a single job anyway:
Vice President Joe Biden announced in late 2009 that Fisker would reopen a shuttered former General Motors factory in Wilmington, Del., to produce plug-in, electric hybrid vehicles. The plant was never completed and never produced any cars.
Now, some may also wonder whether we’re not seeing a replay of the Preston Tucker saga. Tucker’s prescient design and skillful manufacturing built 50 of the most enduring post-WWII vehicles until a political fight ruined Tucker and his automobile company. The Wall Street Journal gives a much different picture of the Fisker Karma:
Mr. Simon says his car broke down four times over the span of a few months. Each time, Fisker Automotive Inc. picked it up and sent it by trailer from his home in Omaha, Neb., to a dealer in Minneapolis.
The Karma was “so vulnerable to software errors, and the parts used were of such poor quality that eventually I insisted they take the car back and return my purchase price, which they did,” he says. “It’s a real shame, the car itself was beautiful.” …
Troubles with suppliers and regulatory requirements added months to the Karma’s release. Its engineers expressed concerns that the software that ran the Karma’s display screens and phone connections wasn’t ready, people familiar with the situation say. Still, the Karma went out to customers. The company said that its problems were expected of any new model. …
Fisker stopped production of the Karma at a factory in Finland in July 2012 in an attempt to negotiate a cost-saving contract. The following month, Fisker recalled its cars for a second time to fix a cooling system flaw that was linked to battery fires.
It hasn’t built a car since.
Once again, we see that “investing” only works when the investor is managing his own money, and not public funds. How many millions of dollars have been lost because this administration couldn’t admit that it backed turkeys — and also admit that firms that can’t attract investors on its own are the worst possible bets in the first place? The biggest question that the White House should answer is the names of those who kept approving the cash disbursements to Fisker, Solyndra, and a host of others in its loser portfolio even after finding out that the companies were failing.