Bloomberg View: Betting on Solar Energy; Fixing the Mortgage Mess

In a cringeworthy failure, California solar panel maker Solyndra collapsed on Aug. 31 and filed for bankruptcy, just two years after winning $535 million of federal loan guarantees. Solyndra’s rapid rise and fall should have played out entirely in the private sector. Silicon Valley is thick with venture capitalists willing to finance risky, iconoclastic startups. Ever since its founding in 2005, Solyndra had no trouble finding such supporters.

All told, Solyndra raised $1.1 billion from private sources. The extra federal support ended up having the well-intended but unfortunate effect of letting Solyndra ramp up manufacturing in a hurry, even as evidence was emerging that the company had badly misread the changing economics of the solar panel market. A few years ago, prices for the silicon wafers used in most flat solar panels were soaring. Solyndra proposed building an entirely different panel, using cylindrical tubes coated with thin films of copper-indium-gallium-selenide that would pick up light from any direction.