Claims from President Obama were that some failures were bound to happen, such is the risk of business:
“We knew from the start that the loan guarantee program was going to entail some risk by definition,” Obama said, adding that the “overall portfolio has been successful.”
That may be true. What he failed to mention was where they were successful.
Vice President Joseph Biden heralded the Energy Department's $529 million loan to the start-up electric car company called Fisker as a bright new path to thousands of American manufacturing jobs. But two years after the loan was announced, the job of assembling the flashy electric Fisker Karma sports car has been outsourced to Finland.
"There was no contract manufacturer in the U.S. that could actually produce our vehicle," the car company's founder and namesake told ABC News. "They don't exist here."
Alright, so maybe the jobs that were expected as a result of the government funded $97,000 luxury electric cars (of which only 2 have been delivered so far, as the company is a year off schedule), but at least this company will work to make sure the taxpayer money is repaid. Right?
That remains an open question. One which the Government Accountability Office is not so sure we'll like the answer to.
Yet an audit this year by the Government Accountability Office, the investigative arm of Congress, criticized the Energy Department for not keeping close enough tabs on its fleet of auto loans -- including those to Fisker and Tesla -- to ensure they meet benchmarks. The funding was issued under the $25 billion Advanced Technology Vehicles Manufacturing loan program, one piece of a giant umbrella of DOE loans and loan guarantees going out the door.
"DOE cannot be assured that the projects are on track to deliver the vehicles as agreed," said the GAO report examining the department's ATVM program. "It also means that U.S. taxpayers do not know whether they are getting what they paid for through the loans." [emphasis mine]
Well, that's reassuring.
Tesla, mentioned in the quote above, is yet another electric car manufacturer which received a cool $465 million for their efforts. No word yet on where the manufacturing jobs for that company will land.
But the similarities to Solyndra don't end with hundreds of millions of dollars and questions of success. As was the case with the failed solar panel company, Tesla and Fisker may have been awarded their loans because they were uniquely connected to the right people.
Fisker is backed by California VC firm Kleiner Perkins Caufield & Byers, of which one Al Gore happens to be a senior partner. More incriminating, Kleiner Perkins execs are Democrat donors and partner John Doerr serves on Obama's Council on Jobs and Competitiveness.
Tesla has even more questionable connections:
Tesla brings political pull, as well. A former Tesla board member, Steve Westly, is an Obama bundler who raised hundreds of thousands of dollars for the president in 2008 and for his 2012 re-election campaign. His Westly Group was also a financial supporter of Tesla Motors until Tesla went public in 2010, and Westly continues to back the company.
Tesla's founder and CEO, Elon Musk, is a hearty political contributor who has primarily backed Democrats, including Obama. According to published reports, another Tesla investor is Nick Pritzker, a donor to Obama and a cousin of Penny Pritzker, the national finance chair of Obama's 2008 campaign.
This is crony socialism at its finest. While the Obama administration pushes EPA regulations like MACT, which will destroy the competition for green energy (coal), they simultaneously funnel billions of dollars to unproven companies run by donors, bundlers, and friends.
In 2009, Joe Biden, discussing the $500 million loan to Fisker, had this to say:
"Folks, we're making a bet," Biden said on Oct. 27, 2009.
You weren't making a bet Joe. A bet involves putting your own money at stake. This was a heist.