Wednesday, November 21, 2012

Another day, another DOE green energy loan fail


You know your idea is sunk when even the Chicomms who probably throw more tax-payer money at "green" technology than we do can't make it work.

A123 batteries, whom we've covered previously, is part of the Department of Energy's green loan program. They make or attempt to make lithium-ion batteries. One problem is, those batteries don't work. Despite this fact and despite the fact that they've declared bankruptcy hasn't appeared to have been sufficient cause for removing them from the government pay roll.

The Obama administration provided struggling battery maker A123 Systems Inc with nearly $1 million on the day it filed for bankruptcy, the company told lawmakers investigating its government grant.

The company, which makes lithium ion batteries for electric cars, filed for Chapter 11 bankruptcy protection last month after a rescue deal with Chinese auto parts supplier Wanxiang Group fell apart.

That same day, October 16, A123 received a $946,830 payment as part of its $249 million clean energy grant from the Energy Department, the company said in a letter, obtained by Reuters, to Republican Senators John Thune and Chuck Grassley.

In the letter, dated November 14, A123 said the October payment was the most recent disbursement it had received from the government, with an additional $115.8 million still outstanding on the grant.

Thune and Grassley have pressed the Energy Department for more details about its funding of A123 as the company has faltered.

"The Department of Energy needs to answer for why it appears to put federal grants on auto-pilot to the detriment of U.S. taxpayers," the two senators said in a statement. "This can't stand."

We haven't seen an actual pay check in perhaps 20 years. DOE loan recipients haven't seen one in a while either as no matter what condition their business is in, every two weeks it seems, they get that direct deposit into their bank account.

And it gets better: A123, who has blown threw just under half of their loan allocation, says they may still need to use the balance of their grant money to work on their batteries that don't work.

In saner times, companies that produced stuff that didn't work would simply be allowed to go out of business. Their capital, both material and human, would be allowed to move on to ventures that perhaps did work bettering the economy and society as a whole. Not anymore. With tax-payer dollars, we enslave this capital in perpetuity that could better be employed elsewhere.

Welcome to our new economic model.


Doo Doo Econ said...

The two most popular titles in the Miss Government Money Pagent: Miseducation and Misallocation

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