Solyndra Used by Republicans to Bash Obama’s Job Plan

Solyndra Hearing
Jonathan Silver, executive director of the Department of Energy Loans Programs Office, speaks during a House Energy and Commerce Committee hearing on Solyndra LLC on Sept. 14 in Washington, D.C. Photo: Andrew Harrer/Bloomberg

House Republicans used a hearing on Solyndra LLC’s slide into bankruptcy to attack the Obama administration’s stimulus plans, past and proposed, showing the issue may linger as a political liability for the White House.

The Fremont, California, solar-panel maker won a $535 million federal loan guarantee in September 2009, the first awarded by the Energy Department, using funds from that year’s stimulus package. The company filed for bankruptcy protection on Sept. 6, and the FBI raided its offices two days later.

Republicans released a report at a House Energy and Commerce Committee panel hearing yesterday that they said showed White House officials sought to rush a decision on the loan award, and that Energy Department officials failed to see signs of the rising risks in supporting the company.

Solyndra is a “poster child” of the first stimulus and a reason to oppose Obama’s proposed $447 billion package intended to create jobs, Representative Steve Scalise, a Louisiana Republican, said at the hearing.

“I hope you understand now why a lot of us are real skeptical when the president says, ‘Pass the bill now,’ because he did that with the stimulus bill, and we see the failure the failure there,” Scalise told two Obama administration officials called to defend the Solyndra loan award yesterday.

In a Sept. 8 address to Congress, Obama outlined a plan that includes payroll tax cuts, an extension of unemployment assistance, and new construction spending to lower an unemployment rate that has hovered above 9 percent.

“This is exactly what we get when the federal government tries to put money into businesses and tries to pick winners and losers,” Representative Mike Pompeo, a Kansas Republican, said.

Denying Climate Change

Democrats led by Representative Henry Waxman of California said Republicans were using Solyndra to taint other clean-energy projects. Global competitors led by China spend billions of dollars to support their green industries, threatening to dominate the growing market for alternative energy sources, he said.

“The majority of Republicans on this committee deny that climate change is real,” Waxman, the top Democrat on the House Energy and Commerce Committee, said. “If you are a science denier there’s no reason for government to invest in clean energy.”

Republicans were trying to “discredit clean energy,” Representative Edward Markey, a Massachusetts Democrat, said at the hearing.

$9.6 Billion Provided

The Energy Department has provided about $9.6 billion in loan guarantees to 18 developers and manufacturers since 2009. An additional 14 projects have received conditional commitments for $9.2 billion in guarantees, according to the Energy Department website.

Representative Cliff Stearns, a Florida Republican who is chairman of the House investigations panel, said the administration should halt the program to protect taxpayer money and “somebody should be fired” over the support for Solyndra.

Documents collected during the Republicans’ investigation “raise troubling questions” about whether the staff of the Office of Management and Budget “was rushed to complete its review of the Solyndra loan guarantee by Sept. 4, 2009, in time for a groundbreaking event organized at Solyndra’s facilities organized by the White House,” according to the report.

Protecting Taxpayers

The Department of Energy and the Office of Management and Budget “did not take adequate steps to protect taxpayer dollars,” according to the report.

Moira Mack, a spokeswoman for the Office of Management and Budget, disputed a statement in the Republican report that OMB reviewed the loan award in only nine days.

“OMB was briefed for months dating back to the previous administration,” Mack said today in an e-mailed statement. Jeffrey Zients, deputy director of the Office of Management and Budget, described his agency’s review of the risks associated with the loan guarantee as thorough at the House hearing yesterday.

Obama administration officials weren’t trying to influence or accelerate the Solyndra review, White House spokesman Jay Carney said yesterday.

‘Scheduling Matter’

The e-mails in the committee report show only that “there was an urgency to make a decision about a scheduling matter,” he told reporters traveling with Obama to an event in North Carolina. “People were simply looking for answers about whether or not they can move forward.”

Carney said he hasn’t discussed the matter with Obama. The administration stands by its investments in alternative-energy technology, he said.

Republicans also criticized the administration’s decision to let taxpayer support for Solyndra take a back seat to $75 million in funds from new investors in a restructuring of the loan terms earlier this year.

In testimony to the committee, Jonathan Silver, executive director of the Energy Department’s loan office, said the restructuring gave the company “a fighting chance to compete and succeed,” and that the U.S. may still recoup some of its money through the bankruptcy process.

Exiting the Field

Silver said pressure from China, not from senior administration officials, led the department to support clean-energy companies. That nation provided $30 billion in credit to its largest solar manufacturers last year, about 20 times the U.S. investment, Silver said.

“What we can’t do is exit the playing field,” given projected growth in clean energy markets globally, Silver told reporters after the hearing.

House Energy and Commerce Chairman Fred Upton, a Michigan Republican, said in a time of record debt, “I question whether the government is qualified to act as a venture capitalist.”

Brian Harrison, Solyndra’s chief executive officer, and Bill Stover, its chief financial officer, will testify before the House panel on Sept. 23, according to the committee.

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