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Dems On Stimulus Bets: “What’s a Billion Anyhow?”
NRCC | November 1, 2012

Dems On Stimulus Bets: “What’s a Billion Anyhow?”

As Stimulus Losses Accumulate for Taxpayers, Dems Dish Tax Breaks to Special Interests

  • Newly released e-mails document the extensive political pressure from President Obama and Vice President Biden to approve taxpayer-funded loans to their political allies.

  • Indeed, the losses for taxpayers from the Democrats’ stimulus bets are growing. A recent report estimated that the bankruptcy of stimulus poster child Solyndra could cost taxpayers $849 million.

  • But as taxpayers are losing out, the Democrats’ donors are winning special tax breaks.

Newly released e-mails document the extensive political pressure from President Obama and Vice President Biden to approve taxpayer-funded loans to their political allies:

“NEW E-MAILS POINT TO POLITICAL INFLUENCE ON ENERGY LOANS”: “Previously undisclosed emails made public today by the House Oversight and Government Reform Committee describe multiple instances of White House pressure on career Department of Energy officials to speed up approval of government loans to clean energy firms like Solyndra and Abound Solar.” (“New E-mails Point to Political Influence on Energy Loans,” The Washington Times, 10/31/2012)

DOE LOAN OFFICER: “REID MAY BE DESPERATE. WH MAY WANT TO HELP. … WHAT’S A BILLION ANYHOW?”:“Since this is not going to go into the DOE, and just to be clear, the translation is: Reid may be desperate. WH may want to help. Short term considerations may be more important than longer term considerations and what’s a billion anyhow?” (“E-mails Contradict President Obama, Administration Officials on Energy Dept. Loan Program,” House Committee on Oversight and Government Reform, 10/31/2012)

OBAMA AND BIDEN BOTH PERSONALLY INTERVENED TO MOVE THROUGH PROJECTS: President Obama is described in one of the emails as having personally approved ‘moving it ahead,’ thus reversing a prior decision by DOE career officials not to extend $2 billion in tax-funded help to AREVA, a French nuclear power company, on an Idaho project. Vice-President Joe Biden is described in other emails as exerting heavy pressure to gain approval of a $1.3 billion wind farm project at Shepherd’s Flat, Oregon. The new emails contradict claims by Obama and others in his administration that all decisions on the $20 billion DOE clean energy loans were made by career executives in the department.” (“New E-mails Point to Political Influence on Energy Loans,” The Washington Times, 10/31/2012)

“POTUS” OVERRULED DOE CONCERNS ON LOAN TO NOW-BANKRUPT ABOUND SOLAR: “ ‘I am growing increasingly worried about a fast track process imposed on us at the POTUS [President of the United States] level based on this chaotic process that we are undergoing … by designing the fast track process and having it approved at the POTUS level (which is an absolute waste of his time!) it legitimizes every element and it becomes embedded like the 55% recovery rate which also was imposed by POTUS,’ McCrea said.

“‘In another email made public today by the House panel, Silver instructed McCrea to tell a Treasury Department official of White House support for DOE help to Abound Solar.

“ ‘You better let him know that WH wants to move Abound forward. Policy will have to wait unless they have a specific policy problem with abound,’ Silver said in the June 25, 2010, email.” (“New E-mails Point to Political Influence on Energy Loans,” The Washington Times, 10/31/2012)

OBAMA’S “GREEN” PROGRAM “INFUSED WITH POLITICS AT EVERY LEVEL”: “Meant to create jobs and cut reliance on foreign oil, Obama’s green-technology program was infused with politics at every level, The Washington Post found in an analysis of thousands of memos, company records and internal ­e-mails. Political considerations were raised repeatedly by company investors, Energy Department bureaucrats and White House officials.”(Joe Stephens and Carol D. Leonnig, “Solyndra: Politics Infused Obama Energy Programs,” The Washington Post, 12/25/2011)

WHITE HOUSE HAS PREVIOUSLY DENIED POLITICAL INFLUENCE IN LOANS:

OBAMA INSISTED LAST WEEK STIMULUS LOAN DECISIONS WERE “MADE BY THE DEPARTMENT OF ENERGY, THEY HAVE NOTHING TO DO WITH POLITICS”: (“9News Questions President Obama on Libya Attack,” KUSA, 10/26/2012)

ENERGY SECRETARY STEPHEN CHU: LOANS ASSESSED “ON THEIR OWN MERITS,” “NO COMMUNICATION FROM THE WHITE HOUSE” TO PRESSURE LOANS: “Energy Secretary Stephen Chu told the oversight panel in March this year that ‘we looked at the loans on their own merits.’ Previously during a November 2011 hearing of the House Energy and Commerce Committee Chu said he was ‘aware of no communication from the White House to the Department of Energy saying to make a loan or to restructure.’” (“New E-mails Point to Political Influence on Energy Loans,” The Washington Times, 10/31/2012)

OBAMA ON “POSTER CHILD” SOLYNDRA: THEY “WENT THROUGH THE REGULAR REVIEW PROCESS”: “Obama has defended the Solyndra loan, which had been the poster child of the administration’s green jobs push, telling ABC News last month that ‘hindsight is always 20/20.’

“ ‘It went through the regular review process, and people felt like this was a good bet,’ he said.” (Devin Dwyer, “For Sale: Banner that Greeted Obama at Solyndra,” ABC News, 11/2/2011)

Indeed, the losses for taxpayers from the Democrats’ stimulus bets are growing. A recent report estimated that the bankruptcy of stimulus poster child Solyndra could cost taxpayers $849 million:

PRICE TAG FOR FAILED STIMULUS: $833 BILLION:(Congressional Budget Office, 8/23/2012)

1. SOLYNDRA: “REPORT: TAXPAYER LOSS TO SOLYNDRA MAY BE AS HIGH AS $849 MILLION”(“Report: Taxpayer Loss Due to Solyndra May Be As High as $849 Million,” The Washington Examiner, 10/22/2012)

2. BEACON POWER: BEACON POWER GOES BANKRUPT AFTER $43 MILLION OBAMA STIMULUS LOAN: (Tom Hals and Roberta Rampton, “Beacon Power Bankrupt; had U.S. backing like Solyndra,” Reuters, 10/31/2011)

3. ABOUND SOLAR: ABOUND SOLAR FILED FOR BANKRUPTCY AFTER GETTING $70 MILLION IN STIMULUS FUNDS: “A solar manufacturing company that received nearly $70 million from the Obama administration is shutting down and filing for bankruptcy protection, the Energy Department said Thursday.

“Abound Solar won approval in 2010 for a $400 million loan guarantee to aid construction of solar manufacturing facilities in Longmont, Colo., and Tipton, Ind. But amid growing problems for domestic solar panel manufacturers, the company began missing milestones laid out by the department in its loan guarantee agreement.” (Andrew Restuccia, “Another Solyndra? DOE: Loan Recipient Closing,” Politico, 7/3/2012)

“THE THIRD DOE-BACKED COMPANY TO DECLARE BANKRUPTCY”:Abound is the third DOE-backed company to declare bankruptcy. The first was Solyndra last September. Beacon Power, an energy storage company, filed for bankruptcy protection the following month.” (Andrew Restuccia, “Another Solyndra? DOE: Loan Recipient Closing,” Politico, 7/3/2012)

4. AMONIX: OBAMA-BACKED AMONIX LAID OFF 200 WORKERS EARLY THIS YEAR, RECEIVED $5.9 MILLION TAX CREDIT IN 2010: (Neil Munro, “More Solyndra-Style Failure: Obama-tied Amonix Lays Off Most of Company,” The Daily Caller, 1/30/2012)

5. BRIGHTSOURCE ENERGY: BRIGHTSOURCE ENERGY GOT $1.6 BILLION LOAN GUARANTEE, NOW FACING FINANCIAL STRUGGLES AFTER CANCELLING ITS IPO: (Dana Hull, “BrightSource Shelves IPO, Walks Away from Public Markets,” The San Jose Mercury News, 4/18/2012)

6. EVERGREEN SOLAR: EVERGREEN SOLAR DECLARES BANKRUPTCY AFTER GETTING $5.3 MILLION FROM STIMULUS: Evergreen Solar Inc., reportedly received $5.3 million of stimulus cash through a state grant to install 11,000 photovoltaic panels installed at 11 colleges and universities, a recycling facility and an education center in Massachusetts. The company, once a rock star in the solar industry, filed for bankruptcy protection last month, saying it couldn’t compete with Chinese rivals without reorganizing. The company intends to focus on building up its manufacturing facility in China. (“Solyndra Not Sole Firm to Hit Rock Bottom Despite Stimulus Funding,” Fox News, 9/15/2011)

7. SPECTRA WATT: SPECTRA WATT FILES FOR BANKRUPTCY AFTER RECEIVING $500,000 TAXPAYER DOLLARS FROM STIMULUS: “In June 2009, SpectraWatt received a $500,000 grant from the National Renewable Energy Laboratory as part of the stimulus package. SpectraWatt was one of 13 companies to receive the money to help develop ways to improve solar cells without changing current manufacturing processes. The company filed for bankruptcy…” (“Solyndra Not Sole Firm to Hit Rock Bottom Despite Stimulus Funding,” Fox News, 9/15/2011)

OBAMA’S DOE LENT $14.5 BILLION OVER 27 PROJECTS, “TURNED A BLIND EYE TO THE RISKS THAT HAVE BEEN GLARINGLY APPARENT”: “By the expiration of § 1705 program in September 2011, the DOE had approved 27 projects totaling more than $14.5 billion in guaranteed loans. Inexplicably, DOE management has turned a blind eye to the risks that have been glaringly apparent since the inception of the program.” (“The Department of Energy’s Disastrous Management of Loan Guarantee Program,” U.S. House of Representatives Committee on Oversight and Government Reform, 3/20/2012)

“REPORT: ENERGY LOANS COULD COST $3B” FROM “HIGH-RISK” GREEN PROGRAMS:(“Report: Energy Loans Could Cost $3B,” Associated Press, 2/10/2012)

But as taxpayers are losing out, the Democrats’ donors are winning special tax breaks:

OBAMA DOUBLED DOWN ON MORE INVESTMENTS IN COMPANIES LIKE SOLYNDRA AT THE LAST DEBATE: “But I also believe that we’ve got to look at the energy sources of the future like wind and solar and biofuels, and make those investments.” (“Remarks by the President and Governor Romney in First Presidential Debate,” The White House, 10/4/2012)

ENERGY SECRETARY STEPHEN CHU GAVE HIMSELF AN “A-” FOR MANAGING TAXPAYER INVESTMENTS: BROUN: “So what grade would you give yourself?” CHU: “Oh -” BROUN: “A to F, what grade would you give yourself?” CHU: “ There’s always room for improvement, maybe an A-.“ (Energy Secretary Steven Chu, Committee On Science, Space, And Technology, U.S. House Of Representatives, Testimony, 3/1/12)

NEW DOCUMENTS: TAX BREAKS FOR SOLYNDRA INVESTORS COULD BE BETWEEN $306 MILLION TO $341 MILLION: “Papers filed Tuesday by Solyndra’s lawyers say that, under a best-case scenario, the shell company that will be the sole corporate remnant of Solyndra may be able to reap tax breaks from $306 million to $341 million.” (Peg Brickely, “Solyndra Backers Could Reap More Than $300 Million In Tax Breaks,” Wall Street Journal, 9/4/2012)

SOLYNDRA INVESTORS WILL BE ABLE TO USE SOLYNDRA LOSSES TO AVOID TAXES ON FUTURE INCOME COMPLETELY UNRELATED TO THEIR FAILED SOLYNDRA INVESTMENTS:“It will, however, hold ‘tax attributes’ consisting of more than one-half billion dollars in net operating losses,” the government filing states. “The equity holders … may then, assuming they meet the other requirements of the Internal Revenue Code, use those net operating losses to reduce their income tax liabilities on income earned from other sources completely unrelated to Solyndra.” (Jim McElhatton, “Solyndra Investors Could Reap Tax Windfall,” The Washington Times, 8/29/2012)

QUESTIONABLE LOAN RESTRUCTURING ALLOWED INVESTORS TO BE PAID BACK BEFORE TAXPAYERS IN CASE OF DEFAULT“In addition to earlier financing, both companies provided $75 million to Solyndra last year in a controversial restructuring deal approved by the Department of Energy (DOE) that allowed the financiers to be paid back before taxpayers in case of a default… Republicans said that the restructuring only caused taxpayers to lose more money and that the arrangement violated federal rules.” (Jim McElhatton, “Solyndra Investors Could Reap Tax Windfall,” The Washington Times, 8/29/2012)

Dems On Stimulus Bets: “What’s a Billion Anyhow?” http://ow.ly/eVvVS

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