Solyndra, a solar panel manufacturer whose name has become synonymous with the failure of President Obama’s “green jobs” vision, declared bankruptcy earlier this month, despite receiving a $535 million loan from the Obama Administration. This should prompt two key questions. First, how did the company burn through all that government cash so quickly? Second, why should the government invest in private industry at all?
The “green jobs” lobby still has many defenders, who try to shrug off Solyndra as if it was just one more failed company. Phil Greenough, president of Greenough Communications, is just one among many taking the losses lightly:
As for the government’s $535 million loss, he references the private parties that also lost — “big boys and girls,” investors who maturely understood the risk of investing in Solyndra.
But Solyndra is not just another failed company. Taxpayers, who have lost big on it, did not have the choice that private investors did.
Solyndra was already a failing company in early 2010, a fact that did not prevent Obama’s Energy Department from making the loan. PricewaterhouseCoopers released an audit last spring stating that the company was already in debt by $558 million, which should “raise substantial doubt about its ability to continue as a going concern.” As a result, Solyndra was forced to cancel its Initial Public Offering (IPO). This allowed Solyndra to stop disclosing its financial information to the public, and also limited the number of private investors who might have helped out — if any willing and reckless parties could in fact be found after such a brutal audit.
Of course, taxpayers’ money, provided by a friendly White House, is what allowed Solyndra to avoid the market’s clear verdict for so long. This appears to be lost on many defenders of the subsidized “green energy economy.” It is certainly lost on Greenough.
