(Fred Weinberg/The Penny Press) – This is probably going to surprise my regular readers a bit, but I have a hard time getting too worked up over the bankruptcy of Solyndra and the Obama administration’s faux pas in pushing the Department of Energy to grant a half a billion dollar loan guarantee to prop them up. Even with their executives’ cheesy pleading of the fifth before Congress.
Now I need to be clear.
I don’t think it is the government’s job to pick winners and losers.
And this administration seems intent on trying to roll an egg uphill with its nose by trying to back “green” energy projects with tax dollars. In doing so, they’ve wiped out serious, privately funded, generation projects such as the coal fired power plants in Ely which cost Nevada thousands of jobs and devastated the economy of White Pine County.
Further, there is a systemic reason that wind and solar are not yet ready for prime time. Neither lends itself to big plants which feed a grid and, like it or not, that’s the current system we use to distribute power. Most executives at utilities will tell the government anything it wants to hear, but if they had a rare moment of honesty, they would tell you that they really don’t care how much money is flushed down the toilet because, by law, they can take whatever it is from you and me, their customers.
That said, I spent 17 years in Oklahoma and I can tell you that George Kaiser is not some kind of evil, influence peddling investor. He’s a decent, community-minded guy whose bank, the Bank of Oklahoma, backed everything which benefited the state and never asked if you were a conservative or liberal when you proposed something to them.
OK, so he raised a hundred thousand dollars for Obama’s campaign.
In his circles, that’s pocket change.
Further, I would hope that during his 16 visits to the White House which the media keeps bellowing about he imparted some of his business acumen to the children (including the head guy) who have mostly never held a real job or run a business. Because, he has some despite his political leanings.
You can be a liberal and a good businessman. It’s just a little counterintuitive.
There are a couple of subjects which, when the bulk of the media is called upon to explain, they do an awful job. Business is one of those subjects.
Company goes bankrupt, somebody must have stolen the money, right?
Most likely, this deal was simply based on a bad business plan.
One of the problems with making solar panels is that the Chinese can do it cheaper because they don’t pay near for their labor what we do. The other problem is that, absent government subsidies which come in all types including loan guarantees, it’s pretty hard to make money selling them.
That’s because we can still make electricity cheaper by burning coal, boiling water and letting the steam turn a turbine. And we are the Saudi Arabia of coal.
So, I’m not prepared to go after the Obama administration on the loan or the restructuring which allowed Kaiser’s family foundation to make an emergency loan in front of the taxpayer’s loan guarantee because if my lawyers were arranging that transaction they would insist on doing it the same way. That’s business. And, further, if I had to guess, Kaiser will still be a big net loser in this deal.
What I will go after is the concept that the future is in “green” energy. And the follow-on concept that it is the government’s job to somehow subsidize it until it can stand on its own. That’s the kind of dimbulb thinking which causes real business problems that real business people have to work around if they want to stay in business.
Let me give you an example of this kind of dimbulb thinking.
There is a company called LightSquared whose investors are also FOB’s (Friends of Barack). They want to bring out technology to create a wireless network using frequencies close to the Global Positioning System which we all have grown to depend on for things we probably don’t even know about.
Despite the objections of almost every government agency which uses those systems, the Federal Communications Commission said, sure, go ahead and test it.
A now retired four-star General says he was told to change his Congressional testimony on the issue. He was against the LightSquared proposal on national security grounds.
But the FCC has become an increasingly political body and it has ignored its own professional staff. To help an FOB.
Yet the same FCC is considering joining the Department of so-called Justice in trying to stop the folks at AT&T from buying out the Germans who own T-Mobile which would arguably be good for national security.
Now in the Kaiser case, I’m pretty sure that the only sin was the fact that the government was involved at all in subsidizing any sort of start-up green energy company. I doubt George Kaiser made any money and I think he probably lost more than you or I could afford to lose on such a venture.
But allowing the FCC to use its regulatory power to pick winners and losers and jeopardize our national security in the process is something it would behoove the media to get very involved with.
The problem of course, is explaining to reporters first that not every businessman is a crook and not every regulator is a saint.