Last Updated:December 20 @ 06:45 am

Fact: Obama loan to Solyndra resulted in $500M loss of taxpayer money

By Kevin Freking and Tracie Cone

WASHINGTON (AP) - Republicans investigating the government's investment in a bankrupt solar panel manufacturer have concluded that the Obama administration ignored numerous red flags about the company's financial viability, leaving taxpayers on the hook for more than $500 million.

For months, Republican lawmakers have made the government's loan to California-based Solyndra Inc. the centerpiece of their criticisms of President Barack Obama's $787 billion economic stimulus package. The release of the report Thursday by the House Energy and Commerce Committee gave them another opportunity to reinforce that message.

The White House countered that the report showed that none of the accusations that Republicans had made about political interference in approving the loan turned out to be true. Democrats on the committee also released a memorandum taking issue with the findings.

"The Republican report is partisan and one-sided. It does not substantiate the primary allegation that motivated the committee's Solyndra investigation, which is that the loan guarantee decision was a form of political payoff to a campaign contributor," the Democratic memo said.

The Energy and Commerce investigation lasted 18 months and included the review of more than 300,000 pages of documents. Backers of the loan have said competition from Chinese solar-panel manufacturers was a major factor in Solyndra's failure. The report said White House Office of Management and Budget staff was aware that China's effort to penetrate the U.S. market could hurt Solyndra.

An email from an OMB reviewer in August 2009 said pricing pressures from China "raise concerns about how strong Solyndra's position will be in the face of rising competition."

The reviewer had requested to his supervisor that the Solyndra loan be postponed, the report said.

The committee said federal workers also identified risks when the Energy Department and OMB reviewed a restructuring of the loan in late 2010 and early 2011, but the agencies allowed it to move forward anyway.

Solyndra filed for bankruptcy protection in September 2011. Lawmakers estimated that the government could have saved hundreds of millions of dollars if officials had decided to cut the government's losses rather than to restructure the loan.

"Solyndra was a mistake that would have been much smaller if, in fact, career professionals had not been overruled," said Rep. Darrell Issa, R-Calif., the chairman of the House Oversight and Investigations Committee, which had held hearings on the Solyndra case.

But the committee's Democratic staff said Republicans were twisting internal debates among reviewers into evidence of mismanagement. In the end, decisions were made based on merit after extensive consideration of the company's prospects, they said.

"Some of the decisions were difficult decisions, but they were thoroughly debated within the administration, as they should be," the Democratic memo said.

The White House raised questions about the cost of the investigation and said Republicans should be focused on jobs and legislation that would let more homeowners refinance their mortgages.

"This was a merit-based decision and the president overwhelmingly believes it was the right decision to invest in clean energy technologies in this country," White House spokesman Jay Carney told reporters traveling with the president to Florida on Air Force One.

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Cone reported from Fresno, Calif.

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3 Comments

  1. dtowndComment by dtownd
    August 3, 2012 @ 11:11 am

    “The White House raised questions about the cost of the investigation and said Republicans should be focused on jobs and legislation that would let more homeowners refinance their mortgages.”

    Translation: This is your fault! Let’s talk about something else!

    Seriously, how could the right be so narrow and short-sighted as to waste money looking into the HUNDREDS OF BILLIONS we STOLE? Also, how can we get some more? Mortage business, hey, haven’t done that in a couple years…

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  2. freedomthinkerComment by freedomthinker
    August 3, 2012 @ 4:23 pm

    Well, we already knew that Obama doesnt LIKE business (except, maybe, certain business people who make BIG contributions). Solyndra just establishes the probability that he doesn’t LIKE business because he doesn’t UNDERSTAND anything about it. So, how can you promote (or regulate) something you don’t understand? -Especially when there are experts in the Government that said, “Nope. This is not a good thing to do. These guys are likely to go bust.” – But the Emporer always has the last word.

    Maybe that’s the biggest problem with our Economy…

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  3. John SweetComment by John Sweet
    August 3, 2012 @ 8:04 pm

    I much rather they look and see where that money went? Like how far back upstream does it go to Obama’s re-election funds now that would be interesting and one reason Obama is against the investigation which I am sure should focus on all the funds that Obama floated to his supporters and now sees the political donations flowing into his campaign funds.

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