The more the government looks into Solyndra, the failed solar panel company that received stimulus money, the worse it looks for the Obama administration. Criminal charges should be forthcoming.
Prior to leaving office President Bush turned down Solyndra’s application for federal loans. Company records from 2009 reveal the wisdom of his decision; Solyndra was a bad investment risk with operating costs nearly doubling income in 2009.
President Obama, within six days of taking office, placed Solyndra on a fast track to receive the loan guarantees. The principles of the company were heavy Obama campaign contributors who made numerous visits to the White House.
The above paints an all too familiar shady picture; a picture that we’ve gotten used to as observers of Washington DC. It doesn’t outline or highlight the legal problems that are emerging as this story unfolds, however. Andrew McCarthy of National Review fills in the details of the workings of fraud:
The criminal law, by contrast, is not content to assume the good faith of government officials. It targets anyone — from low-level swindlers to top elective officeholders — who attempts to influence the issuance of government loans by making false statements; who engages in schemes to defraud the United States; or who conspires “to defraud the United States, or any agency thereof, in any manner or for any purpose.” The penalties are steep: Fraud in connection with government loans, for example, can be punished by up to 30 years in the slammer.
Although Solyndra was a private company, moreover, it was using its government loans as a springboard to go public. When the sale of securities is involved, federal law criminalizes fraudulent schemes, false statements of material fact, and statements that omit any “material fact necessary in order to make the statements made . . . not misleading.” And we’re not just talking about statements made in required SEC filings. Any statement made to deceive the market can be actionable. In 2003, for example, the Justice Department famously charged Martha Stewart with securities fraud. Among other allegations, prosecutors cited public statements she had made in press releases and at a conference for securities analysts — statements in which she withheld damaging information in an effort to inflate the value of her corporation and its stock.
That’s exactly what President Obama did on May 26, 2010, with his Solyndra friends about to launch their initial public offering of stock. The solar-panel company’s California factory was selected as the fitting site for a presidential speech on the virtues of confiscating taxpayer billions to prop up pie-in-the-sky clean-energy businesses.
Our readers may remember seeing the President on television as he toured the new Solyndra plant in Fremont. It was the perfect photo op for the green president who, channeling Reagan, insisted this company would have a “ripple effect” that would “generate business for companies throughout our country who will create jobs supplying this factory with parts and materials.” Not once did he mention that the company was in financial trouble despite the half million dollar investment of the American people.
The IPO failed…that’s because investors are smarter than Obama appears to be. They looked beyond the president’s rosy rhetoric and gave a smirking no thanks to the public offering. The president’s campaign cash friends, cronies who were also invested in Solyndra, could see the writing on the wall. If something wasn’t done they were going to lose a lot of money. It was at this time that the President stepped in to see that the loan was restructured to give those investors the first position to recoup money when the company was liquidated.
I highly recommend Mr. McCarthy’s article…stay tuned Pilgrims, this bumpy ride has only just begun.
What? Our president shouldn’t be “channeling Reagan”?
NPR did a feature on it. It’s not good, but it’s not fraud. Solyndra never lied about their financial state, so they’re in the clear. And as putting political interest over fiscal prudence is not illegal, it’s unlikely that anybody in the OA is in legal jeapardy.
However, NPR says that the agency that writes the checks was not impressed with Solyndra’s financial state and expressed doubts as to the prudence of the deal, but they were told to shut up and write the check.
There will be political repercussions, no question.
NPR did spend some time explaining why Solyndra couldn’t make a go of it. Did you know that the Chinese government subsidizes its solar industry in billions? … billions!
So much for a free market.
The illegality is not in the original loan. That was a bad decision but legal, just crass politics. However, there was a time later when it became clear that Solyndra was a failure, and they needed more capital. The loan was restructured, and in order to attract private money, the guarantees included subordinating the taxpayer claims to a second position, so the private investors would be reimbursed first. That is contrary to a specific federal law that says the taxpayers must always be in a first position in case of default. That is flat-out illegal. It is only a question of who gets prosecuted. Anyone who owns a house knows what a first deed of trust is. How would you like to find out that your first deed of trust had secretly been changed to a second deed of trust?
Libby: “What? Our president shouldn’t be “channeling Reagan”?
Who said he shouldn’t? I just said he was..and only in using the term “ripple effect” which sounds an awful lot like trickle down”!
“It’s not good, but it’s not fraud.”
Well Libs, the Justice Department being as corrupt as it is we may never actually see justice done but what happened precisely fits the definition of fraud and I’m afraid Obama is guilty whether it was out of arrogance or ignorance on his part.
“Did you know that the Chinese government subsidizes its solar industry in billions? … billions! So much for a free market.”
Huh? Who ever said “subsidies” represent free market principles?
Or am I hearing you incorrectly?
You might also notice the quality of some of their products could use some work, not to mention the fact that those billions may have been tossed down the same rat hole if solar power is found to be problematic down the road. Wind power is flailing around a bit (All those dead endangered species and habitats).
Good question soaps!
Here’s another: How would you like to have invested in a company based on the gushing recomendation of a high profile person of authority only to find later that the company was broke and had a stack of bills?
Neither of these is “presidential” smart.
Interesting points. I’m wondering when we’re going to start talking about Halliburton. Why are we spending billions and billions subsidizing these private companies and losing tons of money on the deals?
An organization just did a study that showed private companies cost more than government 33 out of 35 times. So why do we keep letting these private companies screw over the taxpayers?
Stop hiring all of these expensive contractors and start letting the military take over their own jobs. This is getting ridiculous.
And keep the head on this Solyndra deal please, but also start looking at what we are spending on Halliburton as taxpayers. Don’t defend Republican pets and attack Democrat pets.
freemarket you should let us know if you have a link to information about Halliburton. We are a free speech forum and welcome all information and points of view.
Halliburton is a company that our governemt, under many past presidents, has used on a contractual basis for work the government is not equipped to perform.
Haliburton was a Bill Clinton “pet” so it’s an equal opportunity company.
Have you considered how much more it would cost tax payers if the government trained, paid, and equipped our military to do this work?
A half a billion here, a half a billion there, nearly a trillion on “stimulus”. Pretty soon we will be talking real money.
Tina! Check this out —
http://sisterhoodpatriots.blogspot.com/
Halliburton,really? LMAO
After reading the article in the NY Times about ‘Project on Government Oversight’, their report (POGO) about Government being more cost effective seemed cobbled together at best with what appears to be more selective reporting that actual fact based on broad data. POGO a nonprofit Washington group (Non-profit agency I always read this as Government Funded) and their based where??. I am skeptical as to the finding of ‘POGO’
Here is a link to the NYT article, read and make up your own mind,
http://www.nytimes.com/2011/09/13/us/13contractor.html
There can be absolutely no meaningful progress toward repairing our economy, be it unemployment, increasing prices everywhere we look, the national debt, or the real estate and mortgage dilemma until we remove Barack Obama as President of the United States.
Obama may not be what the lawyers would call the “proximate cause” of some, or even all, of these problems, but he most certainly IS the impediment standing between us and the solutions required.
He has proven to be what I said he was back in 2008:
* an incompetent administrator with absolutely no executive-level experience either in government or in the private sector.
* a thinly disguised Marxist socialist with publicly proclaimed goals which, on their face, can only lead to a disruptive and negative impact on the general economy – namely his stated goal, during the campaign, of intentionally moving fuel prices significantly upward.
In addition:
* he has governed with complete disregard of the will of the American people, forgetting that our Federal Republic is firmly constructed on the concept of the “consent of the governed” and, therefore, has completely sacrificed the historic legitimacy of his administration. Over 60% of the American people opposed his health-care proposal while it was still being debated in Congress, and since it was forced into law by a piece of legislative slight-of-hand of dubious legality and totally void of ethics, now almost two years later that 60% opposition has grown to exceed 75%.
* he has willingly and publicly associated himself with persons of questionable background and questionable loyalty to the United States and has refused to disavow those past associations.
* he has knowingly allowed his campaign and his administration to become complicit in illegal activities directly violating the Federal criminal codes – specifically the attempt to manipulate the Democrat primary in Pennsylvania in 2010 through attempted use of a clearly criminal “quid pro quo” arrangement; an impeachable act at least, and an indictable one in the ultimate analysis.
And now the latest:
* he has pressured the military to modify testimony before Congress in an effort to ensure ongoing support for private-sector programs that would harm our Nation’s security by interfering with military GPS systems, but would maintain the flow of money into certain companies that are high-level Obama campaign contributors.
This has absolutely nothing to to with Liberal or Conservative.
It CERTAINLY has nothing to do with Black or White.
Just ask yourself this:
What would be happening to Obama, right now, if he were RICHARD NIXON?
“Solyndra never lied about their financial state, so they’re in the clear” Oh really? How do you know that fact Libby?
Pie sisterhood patriots is a great blog…love the graphic at the top. Was there something specific you wanted me to see or were you just sharing?
Harold you’re on to something regarding POGO and selective reporting. Here are the key selective sentences in the puzzle:
The article then goes on to compare the cost of certain outsourced jobs performed (contract amount) with the salaries the government would pay similar employees to do the work. The comparison is bogus. If the government actually performed the job the costs would include not only the salaries but the materials and, if the government didn’t have it, the equipment, office space, and other overhead involved in doing the job. Plus once the government took on these jobs they would be employees and the attending expense forever…another permanent fixture of Washington.
Government can never do things cheaper and with greater efficiency because they have no incentive…who will deny them the work, who would be the competitor to keep them honest, who brings down the hammer if the work comes in late or isn’t quite up to snuff? NOBODY HAS TO CARE.
Besides these new government departments would have to have budgets…when budget time comes around what happens? THEY ASK FOR A BIGGER BUDGET!
Private contractors have to come up with the lowest bid to win the job.
K2NE thanks for sharing your thoughts with us.I hope you’ll come back often, you seem to be well informed.
Did you know that the city of Chico does not use the bidding system? They just take whoever comes along at whatever price. Many times, they just contact these consulting firms and ask them if they want the job. Sure we do – here’s our price! Okay, you’re hired!
Did you know, upper level city staffers get to personally hire the firm that gives them their evaluation? Ask our finance director, Jennifer Hennessy. She hired the firm that evaluated her and then she gave herself a $14,000 raise.
I don’t think they put public works jobs up to bid either, at least, I’ve never seen the paperwork. They just have contractors they work with, and that’s it. No bidding, no haggling. They send the bill and WE pay. Same guy, for example, does all the sidewalks in town, at whatever price he’s charging. The same Fresno developer does most of the low-income projects – they got $7 million of our RDA money to take Meriam Park off Tom DiGiovanni’s hands.
This is a conversation that is had Downtown behind closed doors, in those little meetings at 8am. Then there’s the overtime conversation – according to the Police and Fire Chiefs, it is “cheaper” to have mandatory overtime written into the contracts than it is to hire more cops. Oh, but at election time, they scream they want more hires!
There’s two conversations on both of these subjects – the ones they have in the little meetings and the ones they have in the newspaper.
Back to the tomato grinder.
“Don’t defend Republican pets and attack Democrat pets.”
I suppose I should also point out that NPR said the subsidy deal was in the works under the Bush Administration, but circumstances, as we know, intervened. So Free has a point.
And in view of the fact that there is no free market in solar panels, and that nobody denies that Solyndra has a good product which will eventually be very profitable, the problem is an insufficient subsidy.
Put that in your pipe and smoke it.
You can’t be serious with this claim about Haliburton. Are you saying it would cost the military more to train soldiers to prepare and serve food than it does for them to pay Haliburton? Do you even know what Haliburton does? Right now on our military bases private firms handle security for duties that would cost a lot less for soldiers to perform.
In the 80s I delivered mail in the army in Germany. The military contracts that out now. I bet it cost a lost less for me to do it than they are paying a citizen.
And Haliburton was not a “Clinton pet.” Government can and does do things cheaper than private companies. Private companies are trying to make a profit, government is not. Right now contractors bid for government contracts at US pay rates. When they win the bid they subcontract that work out to countries like India (an example of this would be computer programming) when the work takes longer they still get more money and they didn’t use American workers. This goes on all the time.
It should be a federal law that any company that wins a government contract has to hire American citizens. Republicans will never let that happen because the corporations that win these contracts ship so much of the work overseas to subcontractors.
Check out the Project on Government Oversight for more information abou this subject. http://www.pogo.org/pogo-files/reports/contract-oversight/bad-business/co-gp-20110913.html If you are interested in learning about it. If you want to keep on repeating tired talking points that are uninformed and invalid then of course continue to refuse to keep yourself informed.
Non-profit = government funded? I guess that makes it easier to rationalize nonsense. Blue Cross is a non-profit FYI.
Juannita if that’s what the city council does then I’d say something needs to be done about it…I know a number of people have tried for years.
Libby: “I suppose I should also point out that NPR said the subsidy deal was in the works under the Bush Administration, but circumstances, as we know, intervened…”
But not before Bush said no. ABC did a probe in conjunction with congress and found the reason he said no:
http://nation.foxnews.com/solyndra/2011/09/14/bush-admin-voted-against-solyndra-loan
“the problem is an insufficient subsidy.”
Sure, just what every working American wants to hear…throw more money down a rat hole because it might pan out in some imagined future and who cares if those running it are incompetent or overly optomistic…just keep that dead stinky sucker alive…no matter what it takes. You do understand that working Americans and not the rich work every day to pay for such pipe dreams and nonesense?
“Put that in your pipe and smoke it.”
I’m fairly certain you beat me to it.
YCBSerious: ” Are you saying it would cost the military more to train soldiers to prepare and serve food than it does for them to pay Haliburton? Do you even know what Haliburton does? Right now on our military bases private firms handle security for duties that would cost a lot less for soldiers to perform.”
We train soldiers to kill and to break things…not to peel potatoes and take out the trash.
But that isn’t all that Haliburton does for the military. It’s a big company with a lot of subsidiary companies with incredible capabilites. Did you know they were responsible for putting out all the oil fires Saddam set after the first Gulf War> Remember how quickly they got it done? They also build bases, roads, and bridges.
“Right now on our military bases private firms handle security for duties that would cost a lot less for soldiers to perform.”
This may be true, depending on how it is handled, because our military already has people that would have the training necessary for the job…I’m not (and never have been) in the military so I don’t pretend to be an expert on whether that would be the best use for our military personel. And if our government chose to create another department in order to do it…then no way would they do it cheaper!
“I bet it cost a lost less for me to do it than they are paying a citizen.”
Maybe…maybe not. You get healthcare for life? How about college…can/did you get help for that? How about a loan for a home? The military pays for a lot of things for you that they don’t have to pay when a contractor does the work. It’s tough to do a fair comparison from this limited perspective. And if you are delivering mail, making food, cleaning up, building bridges and raods then the military needs more people for the purpose of the military. Since our military is volunteer I think those who agree to serve should be used for the purpose of the military.
“…they didn’t use American workers”
It would cost more to pay them and to ship them in and handle housing etc. Do you want this work done at the best possible price or not? Thinking as a taxpayer stuck with the bill, what would your “executive” decision be?
This is only a problem anyway when there is a shortage of work. If the economy was huming and everyone was working you probably wouldn’t give it a thought.
“It should be a federal law that any company that wins a government contract has to hire American citizens.”
Make a case for this emotionally driven argument, please, because from a business and financial point of view and from the point of view of keeping costs down it makes absolutely zero sense.
“Republicans will never let that happen because the corporations that win these contracts ship so much of the work overseas to subcontractors.”
And what motivates them to do that, do you suppose? Could it be the hostility that certain people in this country show them? We have the highest corporate tax rate in the world. We have regulation…expensive regulation…coming out of our ears wioth more on the way. We have a complex tax and regulation code that require legal in order to prevent noncompliance and punishing fines. We have a litigeous society that sues at the drop of a hat and wins outrageous sums of money (and not for the people harmed but mostly for the lawyers that are in bed with Democrats who write the damn laws). And last but not least we have a bunch of Marxist running around trying to convince people that free markets and corporations are evil!
“If you want to keep on repeating tired talking points that are uninformed and invalid then of course continue to refuse to keep yourself informed.”
I took a peek at the link you provided. My forst stop was the board & staff. This is definitely an anti-corporate group with environmental and leftist associations.
Let me tell you what most Republicans and I think.
If you want less fraud and waste in government, which is where this is happening, then lets make the government smaller. Otherwise, the solution for illegal activity, actual wrong doing is prosecution. That is what our legal system is there to do.
Blanket, all inclusive attacks on corporations generally or unfounded attacks on specific companies for political or special interest manipulation is flat out WRONG! Not to mention stupid.
By the way? A lot of the Haliburton crap was just “talking points” issued exclusively by leftist activist and environementalist liars and thugs to discredit the Bush administration. They were silent when the company was used by Clinton and they have been silent as the Obama administration used them.
Yea I was a bit broad with that comment about Non-Profits in general I realize that any U.S. organizations must have current 501(c)(3) status, as assigned by the Internal Revenue Service, to be considered a Non-profit Program.
I also recognize that there are many service clubs that actually use their 501C status to help American Communities without Government grants, or political bias. I should have modified my statement a bit, I just got caught up in the lack of complete reporting about this or ANY Government doing work for less than the private sector. So how about you and your rationalization spin on the POGO report? shouldn’t you also need to address and revise your clearly selective comments as well about POGO and their findings. It was notable that you only challenged my non- profit comment and not your original post that lacks a lot of substantiation all by itself. However if my link helped readers rational your posting, and eliminates some nonsense than good enough! And in closing Trust me, I know there are many community service organizations that give a way more back more than they ever receive. Sadly it’s groups like POGO (political types)that generate these iffy headlines while depleting grant money for their own inflated salaries and just basically creating unfounded political spin, and in doing so depleting the money the many non-profits who really do the beneficial work need.
“Sure, just what every working American wants to hear…”
That’s exactly what the NPR pundit said.
But if that’s the case, you don’t get to complain about the consequences: a solar panel manufacturer goes belly-up and 1500 people lose their jobs.
“Maybe…maybe not. You get healthcare for life? How about college…can/did you get help for that? How about a loan for a home? The military pays for a lot of things for you that they don’t have to pay when a contractor does the work.”
What ever happened to “jobs, jobs, jobs”? Is it really prudent for some government contractor to, with our tax money, hire Indonesians to staff military kitchens in Iraq, just because it makes this contractor a fat profit?
Maybe with our tax dollars we should pay Americans to staff military kitchens in Iraq … and that could be the profit! And they can have the GI Bill too!
See, Tina, I’m perfectly willing to pay for this. And, rather than destroy the good thing we got going here, I think that people who don’t want to pay … should move to Somalia … where they won’t have to.
Tina: “We train soldiers to kill and to break things…not to peel potatoes and take out the trash.”
Holy crap. What an absolutely awful thing to say. This is extremely disrespectful towards our military, who perform many valuable duties, most of which do not involve killing people and breaking things.
It’s funny, because I’ve heard extreme anti-war liberals say things like this while decrying war. But your statement seems even worse to me, because you’re not just saying that this is all the military does; you’re saying that this is exactly as it should be. That’s pretty revolting, Tina.
“Make a case for this emotionally driven argument, please, because from a business and financial point of view and from the point of view of keeping costs down it makes absolutely zero sense.”
How can you say things like this? You really don’t think it makes sense to require companies that receive government contracts to hire American workers during a time of severe unemployment and very low job growth?
Like Libby said, “What ever happened to ‘jobs, jobs, jobs?'”
It’s statements like these, Tina, which lead people to conclude that you and other Republicans are more interested in the well-being of corporations than in the well-being of average American citizens.
“And what motivates them to do that, do you suppose? Could it be the hostility that certain people in this country show them? We have the highest corporate tax rate in the world. We have regulation…expensive regulation…coming out of our ears wioth more on the way. We have a complex tax and regulation code that require legal in order to prevent noncompliance and punishing fines. We have a litigeous society that sues at the drop of a hat and wins outrageous sums of money (and not for the people harmed but mostly for the lawyers that are in bed with Democrats who write the damn laws). And last but not least we have a bunch of Marxist running around trying to convince people that free markets and corporations are evil!”
This may be Republican gospel, but the majority of economists and small business owners disagree with you. According to them, it’s not regulation that is driving business away; it’s lack of demand.
http://www.nabe.com/publib/pol/11/08/misc.html
“Regulatory activity has gained a lot of attention, with many groups suggesting that American businesses are overregulated by the current administration. With that said, 80 percent of survey respondents felt that the current regulatory environment was good for American businesses and the overall economy.”
http://www.mcclatchydc.com/2011/09/01/122865/regulations-taxes-arent-killing.html#ixzz1Wnj4HK00
“Politicians and business groups often blame excessive regulation and fear of higher taxes for tepid hiring in the economy. However, little evidence of that emerged when McClatchy canvassed a random sample of small business owners across the nation.
“Government regulations are not ‘choking’ our business, the hospitality business,” Bernard Wolfson, the president of Hospitality Operations in Miami, told The Miami Herald. “In order to do business in today’s environment, government regulations are necessary and we must deal with them. The health and safety of our guests depend on regulations. It is the government regulations that help keep things in order.””r
Read more: http://www.mcclatchydc.com/2011/09/01/122865/regulations-taxes-arent-killing.html#ixzz1YWaNxDd0
From the Wall St. Journal:
http://online.wsj.com/article/SB10001424052702303661904576452181063763332.html
The main reason U.S. companies are reluctant to step up hiring is scant demand, rather than uncertainty over government policies, according to a majority of economists in a new Wall Street Journal survey.
“There is no demand,” said Paul Ashworth of Capital Economics. “Businesses aren’t confident enough, and the longer this goes on the harder it is to convince them that they should be.”
In the survey, conducted July 8-13 and released Monday, 53 economists–not all of whom answer every question–were asked the main reason employers aren’t hiring more readily. Of the 51 who responded to the question, 31 cited lack of demand (65%) and 14 (27%) cited uncertainty about government policy. The others said hiring overseas was more appealing.
Some executives echoed the survey’s central finding.