Tales from Green Nation

*

Fisker: the Solyndra with wheels



Fisker had secured $192 million in tax-payer dollars to build hybrid sedans here in Delaware Finland at $50,000-$60,000 a copy. Unfortunately, no one wants hybrids that cheap, so Fisker went from manufacturing high-end sedans to truly luxury sedans at $110,000 per model.


Given this outstanding business model it should come as no surprise that in 2012 Fisker sold an estimated 900 cars as the Feds moved in to seize assets in this all but closed company.


But there is some good news. The feds have found a buyer. The bad news is that the tax-payer will once again take a bath on yet again another failed DOE green loan venture whose only apparent intent was to line the pockets of this administration’s politically connected.


(Previous posts on this epic boondoggle upon which we have blogged extensively can be found here)



From The Daily Caller:

The Energy Department has sold off its $192 million loan guarantee to Fisker Automotive to Chinese billionaire Richard Li for $25 million — the biggest taxpayer loss on a green loan since the failure of Solyndra.

The Energy Department will announce the “selling of the promissory note” to Hybrid Tech, which is owned by Chinese billionaire Richard Li, according to sources familiar with the sale. The DOE sold the loan to Li for $25 million after lending the financially troubled green automaker a total of $192 million since 2009.

A Chinese billionaire? We were previously unaware that Communists allowed such a species to exist. We’re sure there is nothing fishy going on there.


We’re not opposed to green energy. What we're opposed to is throwing away $167 million at a cronyisitc green scheme that never had a chance of surviving.


Mr. President, we know you will never get the clue that picking winners and losers is no way to run an economy so we’ll just have to wait for term limits to effectively achieve the same goal.





* Perhaps the quintessential image of the Fisker Karma: Being towed off the track after breaking down shortly into Consumer Reports test drive of the car. On the bed of that truck, the Karma achieves the greenie dream of a zero emissions vehicle lumbering down the highway on a flatbed at 50 mph.



.

Message: "I care" *

.

A couple of weeks back when it became news that millions of American were losing their healthcare coverage, it came as a surprise to a majority of Americans that had heard the President on numerous occasions reassure the country that if you liked your current healthcare plan, you could keep it, and often times closing out that statement with a definitive “period.”


Predictably, the water-carriers in the state-controlled media when into spin mode. They reasoned that the President did not flat-out lie to the public because no one was losing their coverage, they were merely “transitioning” from their old “sub-standard” coverage into better coverage. That this decision was taken out of your hands was merely demonstrable of what a clueless rube you are and that we should be thankful of the wise and benevolent actions of a federal bureaucracy thousands of miles away made possible via ObamaCare… you’re welcome.


Of course, we didn't hear anything about this "transition-y" thing prior to October 1st but no matter...



So, imagine our surprise when Thursday evening, the President in an interview with Chuck Todd on NBC News, said he was sorry that all these millions of American were losing their current health coverage “based on assurances they got from me.”


So confusing. Why was he essentially apologizing for removing us from our “sub-standard” policies when as single males it was clearly in our best interest to have a healthcare policy that covered us for pregnancy/maternity services? That would be more comprehensive, would it not?

http://t.co/4Kf95LOrbG How is it that #MSM will spin getting thrown under the bus by Preezy? Stay tuned.

— Dean R. Riehm (@deanriehm) November 8, 2013

It didn't take long. Back into the spin cycle:


Of course there will be winners and losers as a result of ObamaCare


Again, this faint support for the law was not uttered prior to October 1st.


Let the tweet-fest begin:

http://t.co/Nb4r3WRjLA If you are rating a national HEALTHCARE law based upon a winners/losers ratio, the law sucks. #ACA

— Dean R. Riehm (@deanriehm) November 8, 2013

http://t.co/Nb4r3WRjLA If you say "winners vs. losers", I say, "fine...then u are conceding that this was all about income re-distribution"

— Dean R. Riehm (@deanriehm) November 8, 2013

Can we just be honest... ? "sub-standard plan" = you're not paying enough to cover other people's plans. #ACA

— Dean R. Riehm (@deanriehm) November 8, 2013

Call us cynical but we’re skeptical of the president’s apology. The law which bears his name absolutely counts on younger healthier people paying for services/coverage they won’t use to cover that which others will use but can’t afford, i.e. the sick and/or elderly.



With insurance companies no longer able to deny coverage to those with pre-existing conditions, good luck with getting enough of the “young invincibles” to prop up this wretched scheme. #implosion



C’mon… without ObamaCare you would’ve never have been introduced to the terms “adverse selection” and “death spiral”.






* During the 1992 presidential campaign, those were the guidance notes given to George H.W. Bush by his aides prior to a speech meant to convey his empathy with the American people during the early nineties recession. Missing the “guidance” portion, Bush recited those three words verbatim resulting in the most clunky, insincere and tone deaf moment of his Presidency.



.

While we were away....

Our little min-blogging vacation over the weekend did not stop the bad news from rolling in with respect to the “new” federal healthcare law aka ObamaCare that will kick in starting October 1st.



First, the law continues to poll badly even while having many of the favorable benefits of the law front-loaded.



This unpopularity and the um, uneven, roll-out of the law, however is somehow the fault of the GOP.




Doctor rationing to begin in California:

The doctor can't see you now.

Consumers may hear that a lot more often after getting health insurance under President Obama's Affordable Care Act.
To hold down premiums, major insurers in California have sharply limited the number of doctors and hospitals available to patients in the state's new health insurance market opening Oct. 1.
New data reveal the extent of those cuts in California, a crucial test bed for the federal healthcare law.

Healthcare Company to Lay Off Over 100 Because of Obamacare:

A Georgia health care company will lay off over 100 employees due in part to Obamacare, according to a WSB-TV report:

"We have confirmed more than 100 Emory health care employees are going to lose their jobs in part because of the Affordable (health) Care Act," said a local anchor.

"I think it's bad it's affordable health care and people are losing their jobs," said a man interviewed by the reporter.

"It's sad. It really is," said another man. "A lot of people are going to lose their homes and cars and everything they worked all their life for."

Progressive darling Trader Joe’s to eliminate health care plans for part-time employees:

After extending health care coverage to many of its part-time employees for years, Trader Joe’s has told workers who log fewer than 30 hours a week that they will need to find insurance on the Obamacare exchanges next year, according to a confidential memo from the grocer’s chief executive.

In the memo to staff dated Aug. 30, Trader Joe’s CEO Dan Bane said the company will cut part-timers a check for $500 in January and help guide them toward finding a new plan under the Affordable Care Act. The company will continue to offer health coverage to workers who carry 30 hours or more on average.

Mickey Ds looking to get out from under ObamaCare’s onerous regulations:

Franchise restaurant owners have come to Washington seeking a change to ObamaCare that they say could prevent them from having to cut their employees’ hours.

The healthcare law requires large employers to provide insurance to employees who work at least 30 hours per week.

Franchise owners say the employer mandate threatens to erase their narrow profit margins and are telling lawmakers they need to overhaul the law before it’s too late.

“Employees won’t have the hours they need, and they won’t get employer-sponsored healthcare, either,” said Steve Caldeira, president and CEO of the International Franchise Association (IFA).

“[Franchisees] are dealing with high commodity costs, high energy prices, higher taxes from the ‘fiscal-cliff’ deal, and now they are trying to work through ObamaCare,” he said.

More than 300 members of the franchise association are making the rounds on Capitol Hill to lobby for the ObamaCare changes. Monday’s visitors included IFA members from Mr. Rooter, McDonald’s and Dunkin Donuts.

So, if Congress and Big Business are getting breaks from the law, why not the fast food sector? After all, now that health care in this country has been sufficiently politicized, the law will not be about “care” rather picking winners and losers.

The amount of lobbying being done on Capitol Hill by entities looking to get away from this law should tell you everything you need to know about it.





Finally, the President's BFF, Warren Buffett says it's time to scrap the law and start over and we whole-heartedly agree:

"Healthcare costs in the United States are like a tapeworm eating at our economic body.

"Those words come from famed investor Warren Buffett, who said he would scrap Obamacare and start all over.

"'We have a health system that, in terms of costs, is really out of control,' he added. 'And if you take this line and you project what has been happening into the future, we will get less and less competitive. So we need something else.'

"Buffett insists that without changes to Obamacare average citizens will suffer.

"'What we have now is untenable over time,' said Buffett, an early supporter of President Obama. 'That kind of a cost compared to the rest of the world is really like a tapeworm eating, you know, at our economic body.'

"Buffett does not believe that providing insurance for everyone is the first step to take in correcting our nation's healthcare system.

"'Attack the costs first, and then worry about expanding coverage,' he said. 'I would much rather see another plan that really attacks costs. And I think that's what the American public wants to see. I mean, the American public is not behind this bill.'"

This common sense approach to overhauling our healthcare system is precisely why it doesn't stand an ice cube's chance in hell in Washington D.C.

The Senate getting into the definition business

Citing a bogus need to protect journalists, a Senate panel starts down a dangerous path with respect to a free press and free speech.



From the Associated Press:

A Senate panel on Thursday approved a measure defining a journalist, which had been an obstacle to broader media shield legislation designed to protect reporters and the news media from having to reveal their sources.

The Judiciary Committee's action cleared the way for approval of legislation prompted by the disclosure earlier this year that the Justice Department had secretly subpoenaed almost two months of telephone records for 21 phone lines used by reporters and editors for The Associated Press and secretly used a warrant to obtain some emails of a Fox News journalist. The subpoenas grew out of investigations into leaks of classified information to the news organizations.

The AP received no advance warning of the subpoena.

The vote was 13-5 for a compromise defining a "covered journalist" as an employee, independent contractor or agent of an entity that disseminates news or information. The individual would have been employed for one year within the last 20 or three months within the last five years.


The committee later approved the overall bill on a 13-5 vote.

Sen. Chuck Schumer, D-N.Y., a chief proponent of the medial shield legislation, worked with Sens. Dianne Feinstein, D-Calif., and Dick Durbin, D-Ill., as well as representatives from news organizations, on the compromise.

The bill would protect reporters and news media organizations from being required to reveal the identities of confidential sources, but it does not grant an absolute privilege for journalists.

Everybody else... forget about it.

Sen. Jeff Sessions, R-Ala., complained that the definition of a journalist was too broad. Pushing back, Feinstein said the intent was to set up a test to determine a bona fide journalist.

"I think journalism has a certain tradecraft. It's a profession. I recognize that everyone can think they're a journalist," Feinstein said.

But Di-Fi and the rest of our betters will figure that out for the rest of us. Don't you worry.


If you are thinking like we are, we don't particularly feel comfortable with that pack of jackals in the Senate defining who is and is not a journalist, particularly if it comes down to what Schumer, Durbin and Feinstein think.


Now, one would think that news organizations as 4th estate pillars would be speaking out against this curtailment of free speech but that's not how things work in the rent-seeking culture of Washington D.C. Let's just say that if you are not at the table then you are on the menu and any chance outfits like Associated Press and Rueters can curry most-favored status from Congress they are going to jump at that opportunity.


And we have said this before as well: this isn't about protecting whatever arbitrary definition of "journalist" the Senate comes up with, this is all about control. Senate Democrats acting on the cue from their boss aren't concerned with transparency and responsible governance. Picking winners and losers with respect to who is and is not a "journalist", creating a caste system, if you will, makes it that much easier to control the messaging coming out of Washington D.C.


Pesky websites like HotAir or Instapundit can then be marginalized or worse yet, be acted against once we start travelling down this road of who does and doesn't deserve protection under the 1st amendment.


This is a horrible piece of legislation that if it does get out of Senate will die in the House and which is another reminder of how critical it is for the (R)s to hold said House in 2014.

When perceived attempts to bolster 1st amendment become cynical attempts to dismantle it

.


On Monday, we got into the curious case of a U.S. District Attorney making clear that federal civil rights laws would not tolerate people denigrating the Islamic faith on social media. In wrapping up the post we asked the following question:

Is this loser Killian suggesting that people on social media and "just bloggers" are not afforded the same 1st amendment protections as traditional media outlets? It would seem to be that way to us.

Now, consider what New York Times executive editor, Jill Abramson, called the "criminalization" of news gathering in the wake of the Department of Justice's seizure of the phone records of 20 Associated Press reporters and those of Fox News reporter, James Rosen, in two separate leak investigations.


What this has led to is the resurrection of the medial shield law which would protect media organizations from investigation and prosecution for the disclosure of government secrets. We can't have an effective 4th estate and thus an effective constitutional republic if that 4th estate is worried they are going to be thrown in jail for merely doing their job, right? So, everything sounds good so far, yeah?


Here's where we hit the pause button, however, as with nearly every piece of proposed legislation in Washington D.C., there will be winners and there will be losers. What it's looking like more and more is our vaunted defenders of democracy are, via the media shield law, engaging in some good old fashion rent-seeking to not only protect themselves but to make exclusive their status on the whole question of freedom of the press and free speech.



Here's the Weekly Standard explaining things (as you are reading this, please keep in mind our good friend, U.S. District Attorney Bill Killian):

More than 50 news organizations (Reuters, Gannett, the New York Times, and so on) signed a letter protesting the AP subpoenas, and of course journalism guilds like the Society of Professional Journalists are using the subpoenas to agitate on behalf of the Free Flow of Information Act—and for the same reason guilds always lobby the government for special privileges. The act will go a long way toward establishing a government-sanctioned journalistic class. There will be, on the one hand, approved reporters who are immune to certain kinds of governmental inquiry, and, on the other hand, everyone else, those less exalted citizens who, faced with the same governmental inquiry, would just have to suck it up. The act is a classic restraint of trade, protecting favored journalists from the pressure of competitors who lack the proper credential.

We don’t doubt there are admirable libertarian impulses behind the shield law, too, if it is intended to encourage the exposure of illicit uses of government power. But like so many libertarian impulses, admirable or otherwise, this one ends up extending rather than restraining the reach of the state’s sweaty and thick-fingered hand. Any shield law must turn on definitions. Who’s a journalist? Well, says one version of the act, a journalist is “a person who, for financial gain or livelihood, is engaged in journalism.” Leave aside for the moment why anyone in his right mind would go into journalism “for financial gain.” The next question is, And what is journalism? It is “the gathering, preparing, collecting” etc. etc. “or publishing of news or information that concerns local, national, or international events or other matters of public interest for dissemination to the public.” These are definitions without practical meaning. They will be refined on the fly, applied willy-nilly, by either unelected judges or self-interested legislators.

Even better, it reminds us of the advance our technology has made since the day of the great A. J. Liebling, author of the famous aphorism, “Freedom of the press belongs to the man who owns one.” Now, of course, we all own one. Liebling’s press baron could be anyone with a laptop and a connection to the free Wi-Fi at his local Starbucks. From even so modest a perch a budding Lord Beaverbrook or Colonel McCormick can gather “news and information” on “matters of public interest” and disseminate it to a readership beyond Liebling’s wildest dreams. The Free Flow of Information Act reminds us that the free flow of information—the freedom of the press—the First Amendment itself—will thrive so long as the government doesn’t try to protect it.

r


Imagine that: a federal registry of government-sanctioned reporters. Not sounding too free-speechy, now, is it? But it shouldn't be surprising as the poltical class in this country, comprised of Democrats and Republicans alike, are fully vested in and thus fully supportive of extending/expanding the status quo. Never make the mistake of thinking otherwise.


And with respect to Killian's not-so-veiled threats to sic the federal government on those who say nasty things about Muhammed on social media, he knows damn well he would not be able to say the same things regarding the main stream media with or without any media shield law.


So, it's happening already where you have free speech for some but not free speech for others and if you are reading this now, which you are, you don't need to be a rocket scientist to assume that bloggers and blogging would be in that latter category. But we've engaged in journalism here on this blog if you believe the practice of journalism involves the "gathering, preparing, collecting” and then publishing of information, etc., etc., ... The rent seekers, in the fourth estate and indeed the entirety of the political class of this country are more interested in defining free speech in terms of who is engaging in it rather than the existential being of the speech itself. Speech is, man.


This is reminiscent of the arguments made by those on the ideological losing end of the Citizen's United case. Corporations are not people so their massive spending on political causes/campaigns is not considered speech as per the 1st amendment is the argument we have heard. But are not corporations made up of multiple individuals? And even that misses the larger point of, it's not about corporations or people or labor unions... it's about the "speech", stupid? In the Citizen's United context, an attempt to curtail speech was being made, regardless of the source of that speech, thus it ran afoul of the 1st amendment.


As we intoned before, regardless of the media shield law, there is move afoot to, on one hand legitimize speech and thus, on the other hand, delegitimize political/free speech which is poisonous for a fully functioning constitutional republic. Needless to say, government-approved speech is not free speech in any sense or manner of the word.



Special shout-out to new followers: "Joe", "Stuart Spivey" and "Jennifer Schaffer"

Fisker: we scarcely knew ye

*




Of all the Department of Energy's green loan debacles and there have been many, Fisker stands above even the Solyndra disaster for a combination of audacity and incompetence.

(For previous posts regarding Fisker, please go here)

To quickly recap: Fisker Automotive was to build electric hybrids cars and was approved for $529 million in loan guarantees (more than they requested) from the Department of Energy to do so. Originally, the two models of cars they were to build were going to be in the $50,000-$60,000 range. In short order, that price escalated upwards to the $110,000 range for it's high-end model thus going from hybrid to luxury hybrid.

The cars were to be assembled at a plant in Delaware as part of the justification for this massive loan was that it would create good paying green manufacturing jobs here in the U.S. The only problem was that the Delaware plant never produced a single car, rather the assembly operations had been relocated to... Finland.

If you were thinking that perhaps a stipulation of the loan would be that our tax dollars wouldn't go to pay the salaries of Paavo, Heikki and the rest of the boys over there, you and we are in the same company.


After falling drastically short of production and sales goals (last year, they sold only 900 out of the 48,000 market-wide plug-ins), the cars plagued by mechanical, electrical and software problems and the failure of A123 batteries (yet, another DOE green loan #fail) last year was a harbinger of doom for Fisker and its aptly-named luxury model "Karma".

And on Monday, there was even more bad news for the car company that has not produced a car since last August.


From the New York Times:

The all-but-closed company skipped a large loan payment that was due on Monday, leading the federal government to take the unusually aggressive step of seizing $21 million from the company's cash reserves to begin recouping the $192 million in taxpayer dollars spent on the company's flawed strategy.

Which means, of course, Fisker is still on the hook to U.S. taxpayers to the tune of $171 million.


The fall-out from this extends beyond merely financial as green technology and our wisdom of taxpayer subsidies for green technology takes a P.R. hit:

Some environmental activists worry about the potential ramifications of a Fisker bankruptcy.

"We can't get to where we need to be in electric vehicles without government help," said Dan Becker, head of the Safe Climate Campaign, an advocacy group in Washington.

Mr. Becker, good sir, if $192 million committed out of $529 million promised isn't considered "help", we scarcely know what is and Fisker still managed to bollox things up.



And if the Obama administration has committed tax-payer money to other, more established auto-manufacturers like Ford and Toyota for their EVs without such disastrous results what is the explanation for what happened with Fisker?

From CBS News:

The Obama administration was warned as early as 2010 that electric car maker Fisker Automotive Inc. was not meeting milestones set up for a half-billion dollar government loan, nearly a year before U.S. officials froze the financing after questions were raised about the company's statements, newly released documents show.

An Energy Department official said in a June 2010 email that Fisker's bid to draw on the federal loan may be jeopardized for failure to meet goals established by the Energy Department.

Fisker continued to receive money until June 2011, when the Energy Department halted further funding. The agency did so after Fisker presented new information that called into question whether key milestones - including launch of the company's signature, $100,000 Karma hybrid - had been achieved, according to a credit report prepared by the Energy Department.

The December 2011 credit report said "DOE staff asked questions about the delays" in the launch of the Karma "and received varied and incomplete explanations," leading to the suspension of the loan.

Recall that the Fisker loan was approved in mid-2009 so it only took a year for the warning flags to go up. One year.

If the warning flags were going up that early, it would suggest perhaps that exercising some due diligence at the front end would've revealed that the loan should not have been made in the first place. Just sayin'.


As it stands, and we are being polite, what this represents is a dereliction of duty by Team O in the stewardship of the taxpayers' scratch. There's really no other way to look at it and yet there will be no repercussions for this willful negligence.

Committing tax-payer money to not-yet-market-ready technology is a losing proposition and committing the same to a start-up using that same technology that can't find sufficient private backing is a guaranteed losing proposition.

Unfortunately, Team O won't learn this lesson. The pursuit of currently suspect green technology subsidized by your money is an article of faith embedded in their collectivist religion and for the smartest kids in the classroom picking winners and losers with respect to directing the economy and "creating" jobs is a divine rite not to be left to the whims of market realities. That we should be so fortunate to be blessed by their benevolence and wisdom.




* Perhaps the quintessential image of the Karma. Being towed off the track after breaking down shortly into Consumer Reports test drive of the car. On the bed of that truck, the Karma achieves the greenie dream of a zero emissions vehicle lumbering down the highway at 50 mph.

Video clip of the day

.

Our trip to parts of the desert southwest has been delayed while we idle in Kanab, Utah while the clutch on our truck gets fixed, so if nothing else it's a chance to reconnect and see what's going on out there.





Alternate headline: If this is success, we'd hate to see failure


The Obama campaign is fond of saying that they saved General Motors. A political victory perhaps for a dubious definition of "saved" but consider at what cost to the tax-payer and that of our free-market system here in America did this victory come.

On this blog, we've been railing against the auto bailout for years and the following 6 minute video from the Center for Freedom and Prosperity does a nice job of covering why it is that this bailout is/was not a success and why it was and has become such a horrible idea in 4 points:

1. Taxpayers got fleeced (if GM stock were sold today, we'd all be out $25 billion)

2. President Obama gave favors to his union supporters (while other creditors got shafted)

3. When government picks winners and losers, we all lose. (Expending public capital and political pressure to build products the consumer does not want, causes ripples all up and down the auto manufacturing supply chain).

4. The costs are unseen (Moral hazard! Poor performance will be rewarded!)

Yeah, this is something Obama could've laid at Bush's feet, instead he doubled down and proceeded with the bankruptcy cramdown and ensuing favors to his union buddies at the expense of secured creditors which may all fall apart in court due to a backroom deal hatched by General Motors to meet the administration demands for a quick bankruptcy which was kept hidden at the time from the bankruptcy judge.


General Motors and Chrysler should've been allowed to enter bankruptcy under normal means which would've forced them to settle with their creditors while keeping the doors open while they restructured their organization and union deals. Instead, we have this unholy mess as a reward for bad business practices while sticking the tax payer for tens of billions of dollars.

Remember all this next time you here how the administration "saved" the U.S. auto manufacturing industry and how GM and Chrysler now represent "success" stories.

Into the black (hole)

.

More good news from the Environmental-Industrial complex...


You know what's eating us about the Department of Energy being unable to locate $500 million worth of equipment? It's not necessarily the amount; that $535 billion we sunk into Solyndra is effectively missing as well and makes this case look almost like a rounding error. It's just that... well, read on, you'll find out.

An audit conducted by the Energy Department's Office of Inspector General was "unable to locate" $500,000 worth of equipment purchased with stimulus money by a recipient of funds distributed through the deparment's "Advanced Batteries and Hybrid Components Program," according to an audit report published by the OIG.

The DOE said it would not be "appropriate" to release the name of stimulus-money recipient where the $500,000 worth of equipment could not be located.

Pray-tell, why? It's our money, dammit. Or is this just some more of that new transparency this administration has promised us?

The program was given nearly $2 billion in stimulus funds "to support the construction of U.S. based battery and electric drive component
manufacturing plants." As of June, DOE had "expended" about $1.2 billion of that money and had made grants to "30 for-profit manufacturers," according to the July 10 audit report.

For-profit? Well, good for them. If they are indeed for-profit ventures then why are we subsidizing them with our tax dollars? Or is our subsidization being counted as revenue that pushes them into the black, if these manufacturers are indeed making a profit. In the world of Peronist picking winners and losers, these lines of accounting get awfully blurry.



From the OIG's audit:

The other two "conclusions and observations" in the audit were:

--"Better define regulations governing the retention of documentation supporting procurement decisions. Regulations currently require for-profit recipients to follow best commercial practices, but do not define such practices. One recipient in our sample had purchased about $24 million in equipment and services without adequately documenting purchasing decisions."

Our limited exposure to the acquisition rules end of things in our career in defense acquisition bears out that the government does allow for a bit of leeway in exactly how receipts are documented but they damn well had better have some ISO-approved system in place.

What strikes us about the DoE green loan program is just how poliiticized it has become. There is a zealous and near-maniacal pursuit in the green technology sector absent any regard for traditional business models. There aqppears to be absolutely zero regard for risk management, transparency, ethics, technological feasibility and return on investment. In short, ignored are the very factors that would sink, immediately, a privately-funded venture. Ventures like Solyndra, Beacon Power, A123 and SunPower are doing just that, yet with tens of billions of our tax-dollars being sunk along with them.

It is our fervent wish to see President Romney take a blow torch to this inept, failed and corrupt Department of Energy green loan program.

.

Expecting different results?

.

Back in December of last year we reported out on the Navy's big biofuel push which started out with replacing a quantity of JP-5 which fuels the Navy's jets and helos. Here is what we said at the time:

The departments of Agriculture and the Navy announced plans Monday to buy 450,000 gallons of non-food biofuels -- at a cost of $16 per gallon -- in what will be the largest federal purchase of biofuels in U.S. history.

The purchase is being authorized by an executive order under the Obama administration's "we can't wait" campaign.

Administration officials gave no indication why they're not going through Congress, instead using a program that was established to promote rapid job growth by bypassing congressional debate.

Perhaps why Congress was not able to chime in on this decision was because the fuel that this biofuel is replacing, JP-5, which powers the Navy's jets and helos goes for about $4/gallon. Crazy theory, we know, but that might just explain it.

Back to real time: We went on to point out that one of the firms that was producing the biofuel was politically-connected. C'mon, you know where this is going. Back to December:

Two companies will participate in the program -- Louisiana-based Dynamic Fuels, a joint venture of Tyson foods and Syntroleum Corp, which makes biofuel from used cooking oil; and California based Solazyme, which makes fuel from algae.

Now we get to the part you've been waiting for:

Solazyme is not just any biofuels company, and its continued partnership with the Navy is not without crony connections. Its strategic advisor is T.J. Glauthier, Obama donor and part of President Obama’s transition team, as Solazyme’s website states:

TJ Glauthier is an advisor and corporate board member in the energy and “clean tech” sector. He advises companies dealing with the complex competitive and regulatory challenges in the energy sector today. He also served on President Obama’s White House Transition Team, where he focused primarily on the energy portion of the economic stimulus bill.

Here and now: Yeah, we are so cronying out our national security.





So, nearly 3 years after SecNav Ray Mabus* made the bold prediction that by the year 2020, half the Navy's fuel and power would come from green sources, how's all that working out?

On Wednesday, the Great Green Fleet is scheduled to make its first demonstration voyage in Hawaii, just as Mabus promised it would. But this is hardly the triumphant moment that the Navy Secretary depicted back in that hotel ballroom. Support for the Great Green Fleet — and for Mabus’ entire energy agenda — has collapsed on Capitol Hill, where both Republicans and Democrats have voted to all but kill the Navy’s future biofuel purchases. In the halls of the Pentagon, the Navy’s efforts to create a biofuel market are greeted with open skepticism. Even inside the environmental community, there’s deep division over the wisdom of relying on biofuels. And while the Navy has tried to deflect questions about the cost of its renewables push, a little-noticed Defense Department report shows that the Navy could spend as much as an extra $1.8 billion per year if it buys all the biofuel it’s pledged to burn.

Continue reading full article here:


The summary contains all the usual suspects but these paragraphs jumped out at us:

One reason why: Biofuel companies aren’t like high-tech firms that can start small and slowly scale up. A new biofuel refinery could cost anywhere from $65 to $300 million to build. (And that doesn’t even begin to address the costs involved with farming the land or transporting the product.) Investors are hesitant to lend out that kind of money without major customers who are committed to buy the fuel; customers are skittish about making those kinds of commitments until they know the biofuel-maker can actually deliver. Currently, there’s not a single commercial-grade biorefinery operating in this country (although several are in the works).

“You need that big anchor customer. And the Navy can afford a premium, because it knows how much petroleum really costs,” explains Brook Porter, an investment partner at the venture capital firm Kleiner Perkins Caufield & Byers, which has put more than $1.5 billion into so-called “clean tech” companies. For some of these firms, a big military contract could mean the difference between life and death.

A struggling, expensive industry that is dependent upon one big customer is ripe for the temptation of picking winners and losers and crony capitalism.



And at the end of the day, the Pentagon has simply worn out of Mabus' crusading for bio-fuels:

Even within the Pentagon, doubts about the program crept in. Top Defense Department officials, ordinarily supportive of green tech efforts, rolled their eyes when I asked about the Navy’s biofuel push. ”We’re not in the fuel production business. We’re not into scaling up new new fuels,” says Kevin Geiss, a former computational chemist now serving as the Air Force’s Deputy Assistant Secretary for Energy.

You know, it's a shame we can't figure out this energy independence thing as we keep finding more and more of that black sticky stuff underneath us here in the good ol' US of A.



* Being in the shipbuilding industry, we've been able to see some of Mabus' maneuvering. To say he is a political animal would be an understatement of the highest order.

.

The problem is...

.

... we just keep finding more of the stuff

From Zero Hedge:

The oil in the ground will run out some day. But as the discovery of proven reserves continues to significantly outpace the rate of extraction, the claims that we’re facing immediate shortages looks trashy.

Some may try to cast doubt on these figures, saying that BP are counting inaccessible reserves, and that we must accept that while there are huge quantities of shale oil in the ground, the era of cheap and readily accessible oil is over. They might cite the idea that oil prices are much higher than they were ten years ago. Yet this is mostly a monetary phenomenon resulting from excessive money creation beyond the economy’s productive capacity. Priced in gold, oil is still very cheap — almost as cheap as it has ever been:

So no. I’m not lying awake at night worrying about imminent peak oil. There’s plenty of extractable oil, and renewable energy will eventually supplement and replace it. But will politics get in the way of energy extraction? The United States has huge hydrocarbon reserves, yet regulation is preventing drilling and shipment, leaving America dependent on foreign oil. And the oil companies themselves are largely to blame — after Deepwater Horizon, should anyone be surprised that politicians and the public want to strangle the oil industry?

The President calls himself an "all of the above" sort but his actions betray his words. He has committed himself fully to the business of picking winners and losers in his energy policy. An aggressive pursuit of crude and shale oil and natural gas would jump-start and sustain a robust economy that could then, with private capital, fund the fledgling green energy sector instead of throwing tens of billions of dollars at the politically connected and technology that, quite simply, is not yet market-ready.




And somewhat related if we're talking politics: Hey, that speech on the economy on Thursday was a big flopper. How about an extra-constitutional executive order on illegal immigration to distract everybody?

Here's Leslie at Temple of Mut:

Dear Readers: While I usually strive to put some humor into my posts, as it helps sustain our emotional balance during these turbulent times, I find little to joke about today. President Obama, in an exceedingly cynical and politically-motivated move, has forgotten the basic tenets of the US Constitution and legislated by executive order.

Leslie predicts Obama will move on to forgiving student loan debts and underwater mortgages via EO sometime prior to November. Markets would necessarily take a dump but when you are on a re-elect panderfest run like this guy is, anything is possible.

.

Enjoy your Father's Day, everybody. We'll see you tomorrow.

.

Solyndra: explained? (UPDATED)

.

(please scroll down for update)


So many different directions to go with but suffice to say that explaining how private equity's private dollars are utilized versus how $535 million public/tax-payer dollars and over one-thousand jobs are flushed down the toilet of crony capitalist wastefulness is a tough sell to a White House press corps that finally appears to be taking an interest in this scrap that Team O wants to fight.

(warning: we may have outlawed waterboarding but this is still going to be a torturous 51 seconds for White House press secretary, Jay Carney)






uhh... what we think he is trying to say is that even when picking winners and losers loses, the President is obliglated to spend even more money to re-train, re-locate or otherwise prop up the lives and careers of people in which he had no business in the first place. Being a paternalistic big brother is a full-time gig, people. Just ask Julia.

We do feel bad for Carney, however. Explaining away the failures of corporatism and crony capitalism is never an easy gig, especially when it's not you but your boss that's responsible. Maybe we can help out Carney and find his boss a new gig on K Street or the rubber chicken circuit come November to put an end to this crap.





(UPDATE #1)


Maybe this guy can explain it:

.

Mitt Romney arrived at the shuttered headquarters of Solyndra Inc. this morning, a surprise visit that was shrouded in secrecy and part of the presumptive GOP presidential candidate’s attack on President Obama’s record on jobs creation.

“Two years ago President Obama was here to tout this building and this business as a symbol of the success of his stimulus,” said Romney, stepping off a bus and onto the public sidewalk in front of the Solyndra buildings just outside Silicon Valley. “Well you can see that it’s a symbol of something very different today.”

“It’s a symbol not of success but of failure,” he said. “It’s also a symbol of a serious conflict of interest. An independent inspector general looked at this investment and concluded that the administration had steered money to friends and family – to campaign contributors. This building, this half a billion dollar taxpayer investment, represents a serious conflict of interest on the part of the president and his team.”

“It’s also a symbol of how the president thinks about free enterprise,” said Romney. “Free enterprise to the president means taking money from the taxpayers and giving it freely to his friends.”

Hitting Obama for failing to understand and respect free enterprise? Check.

Hitting Obama for not job creation but rather job destruction? Check.

Hitting Obama for cronyism. Check.



This was Romney's first campaign event since he clinched the GOP nomination and Solyndra provided the perfect backdrop in which to highlight the failings of the Obama administration.


Exit question: For you O-bots out there that decried the corporatism of the Bush administration: How do you square the circle of the current administration that has turned corporatism into an art form?

More great moments in the history of crony capitalism

*

.

Who's up for a Fisker update?

You all remember Fisker, right? The Al Gore-backed recipients of a $529 million loan guarantee from the federal government in order to build $100,000 electric sedans in Finland. Let us know when this stops looking like a business model in which to poor that amount of tax-payer money because it just keeps getting better.

It would appear that there really is nothing greener than a car that doesn't run.

Here's the test drive report from Consumer Reports:

Our Fisker Karma cost us $107,850. It is super sleek, high-tech—and now it’s broken.

We have owned our car for just a few days; it has less than 200 miles on its odometer. While doing speedometer calibration runs on our test track (a procedure we do for every test car before putting it in service by driving the car at a constant 65 mph between two measured points), the dashboard flashed a message and sounded a “bing“ showing a major fault. Our technician got the car off the track and put it into Park to go through the owner’s manual to interpret the warning. At that point, the transmission went into Neutral and wouldn’t engage any gear through its electronic shifter except Park and Neutral.

We let the car sit for about an hour and restarted it. We could now engage Drive and the same error message disappeared. After moving it only a few feet the error message reappeared and when we tried to engage Reverse the transmission went straight to Park and again no motion gear could be engaged. After calling the dealer, which is about 100 miles away, they promptly sent a flatbed tow truck to haul away the disabled Fisker.

We buy about 80 cars a year and this is the first time in memory that we have had a car that is undriveable before it has finished our check-in process.

(italics, ours)


Because nothing says boondoggle like not even test driving your own vehicle before handing it over for a third-party assessment.


Think about it: billions upon billions of dollars in green technology subsidies and the prices are going in the wrong direction and, in this case, for products that don't even work unlike other areas of the tech sector (computers, TVs and smart phones) where no subsidies were received and real skin was in the game and the market determined the winners and losers.




* As an unintended safety feature, Karma drivers will enjoy the increased visibility.

Great moments in the history of crony capitalism

.


Change

Sanjay Wagle was a venture capitalist and Barack Obama fundraiser in 2008, rallying support through a group he headed known as Clean Tech for Obama.

Shortly after Obama’s election, he left his California firm to join the Energy Department, just as the administration embarked on a massive program to stimulate the economy with federal investments in clean-technology firms.


Following an enduring Washington tradition, Wagle shifted from the private sector, where his firm hoped to profit from federal investments, to an insider’s seat in the administration’s $80 billion clean-energy investment program.

He was one of several players in venture capital, which was providing financial backing to start-up clean-tech companies, who moved into the Energy Department at a time when the agency was seeking outside expertise in the field. At the same time, their industry had a huge stake in decisions about which companies would receive government loans, grants and support.

During the next three years, the department provided $2.4 billion in public funding to clean-energy companies in which Wagle’s former firm, Vantage Point Venture Partners, had invested, a Washington Post analysis found. Overall, the Post found that $3.9 billion in federal grants and financing flowed to 21 companies backed by firms with connections to five Obama administration staffers and advisers.

Picking winners and losers in any particular industry is not the business that a presidential administration should be in. But it's particularly galling when that administration keeps picking the losers... after they were told by third-party auditors and investigators that they were losers as in the case of Solyndra, the DOE's $535 million black hole.





Not coincidentally, Fred Upton (R-MI), who has been wishing to speak with White House officials knee-deep in the DOE's clean energy loan program, is running out of patience with the White House's recalcitrance.

Staffers who once worked for White House Chief of Staff Rahm Emanuel may have to answer questions about their involvement in a botched solar energy deal.

Congressional Republicans on the House Energy and Commerce Committee are putting together subpoenas for five White House aides who allegedly worked to pour more than $500 million in federal loans guarantees into Solyndra, a California solar power company that has since gone defunct. It filed for bankruptcy last year despite the loan support.

The House Energy and Commerce Committee plans to meet on Friday to issue subpoenas for five executive branch employees that they say were involved in the Department of Energy loan given to Solyndra. This will be the third subpoena the committee has considered to obtain information or testimony regarding the Solyndra case.

The staffers being targeted include Kevin Carroll, Kelly Colyar and Fouad Saad of the Office of Management and Budget, Heather Zichal, a White House aide who worked on energy and Aditya Kumar, who worked for Rahm Emanuel in the West Wing and whose name appears in emails on the subject of Solyndra.

It has been one year since the committee started investigating the Solyndra meltdown and to date, the White House has yet to comply with the committee's desire for a sit down.

This must be more of that transparency we've been hearing so much about.

.

Quickies

.

A round-up of news items, articles, columns and blog posts that caught our eye this past week or so.





George Will on the importance of the Supreme Court's decision on ObamaCare:

The Obamacare issues of Medicaid coercion and the individual mandate are twins. They confront the court with the same challenge, that of enunciating judicially enforceable limiting principles. If there is no outer limit on Congress’s power to regulate behavior in the name of regulating interstate commerce, then the Framers’ design of a limited federal government is nullified. And if there is no outer limit on the capacity of this government to coerce the states, then federalism, which is integral to the Framers’ design, becomes evanescent.

So, the time the court has allotted for oral argument about Obamacare is proportional to the stakes. This case is the most important in the more than half a century since the Brown v. Board of Education cases because, like those, it concerns the nature of the American regime.

Evanescent. Ahem. vanishing; fading away; fleeting.


Will's right, however, as if the Supremes uphold the mandate, the precedent will have been set that there is effectively nothing Congress cannot compel you to do. Crazy notion but we don't think that's what the Founders had in mind for the federal government.







Sarah over at Lipstick Underground is no fan of Newt Gingrich but appears to dislike his wife even more:

The REAL ick factor in all this is wife #3, Callista Bisek Gingrich, mistress during marriage #2 and potential First Lady of the United States. Just let that sink in for a minute.

I hold women to a higher standard then men. I’m hardly a prude, and stuff happens in marriages that is just between spouses. But the simple truth is, we are the gate keepers to societal standards around here...and I’m not interested in having to call some home wrecking hussy “First Lady.” She’s no lady and I don’t want her in my White House.

We... had not considered that angle before.






Sir Charles at Doo Doo Economics attended the 28th annual San Diego County Economic Roundtable and provides his round-up here ending with this observation:

All the economists and speakers shared one common sentiment. The 2012 election year will decide if small or big government will rule our futures. My take on the situation is that a smaller government role is warranted. Keynesian economics has run its course. Small tweaks to capitalism work but socialist cronyism is not a small tweak. Making poverty and dependence comfortable and allowing the state to pick winners and losers is not wise in any civilization. Only the passion of self interested individuals who believe in their own ideas and benefit from taking risks can create a vibrant economy. No amount of marketing "green" or other state solutions will impassion true believers, investors and customers like an individual with an innovative idea.

Look no further than Europe to see how that statist/entitlement model is working. Yet, the ruling party at the federal level and in many states including our home state of California seem quite content to be just that... content to follow the status quo when the status quo will lead to certain ruin.






So, just how did that "open marriage" request/demand that was to end Newt's candidacy work out?

Gingrich trailed Romney by double digits just days ago. But that changed quickly after Gingrich's performance in Thursday's night CNN Southern Republican debate. The former House speaker was able to turn his biggest liability -- accusations by his second wife, Marianne, that he wanted an "open marriage" -- into an asset, drawing two standing ovations for assailing the media for bringing up the allegations.

If there was going to be a primary out there where allegations of marital infidelity were going to register with the state's social conservative-leaning Republican voters, it would've been South Carolina and yet Newt wins going away. So, what is it?: Newt's skillful debate performance in criticizing the (northeastern) media or a collective electoral shrug of the shoulders seemingly saying, "It's Newt, of course he's going to want to get a little freaky." Next.

Oh, by the way, Newt carried the majority of married women.


Totally related (via Instapundit):

MORE STILL: A female reader writes that Gingrich may not have been so hurt by ex-wife Marianne’s TV interview:

Hate to say this and don’t use my name, but I watched the interview and thought

“You bitch, he cheated on his first wife with you. What the heck did you expect?”

Kinda parallels what Sarah was saying above, don't it?









How's that Arab Spring working out over in Egypt?

Terrific: Egypt Islamists win 70 percent

Islamists won a combined 70 percent of parliamentary seats in the first election after Egypt’s revolution, according to official results Saturday that cemented the victory of rival religious parties belonging to the Muslim Brotherhood and the more fundamentalist Salafists.

More fundamentalist? Again, terrific.

Don't think we're going out on a limb by saying life won't be getting much better for this particular set of protesters.

KT links to a fine piece by Charles Murray on the changing face and increasing isolationism of the elites in our country:

And the isolation is only going to get worse. Increasingly, the people who run the country were born into that world. Unlike the typical member of the elite in 1960, they have never known anything but the new upper-class culture. We are now seeing more and more third-generation members of the elite. Not even their grandparents have been able to give them a window into life in the rest of America.

It's long but worthwhile and caused us to recall Angelo Codevilla's epic manifesto from the summer of 2010 "America's Ruling Class -- And the Perils of Revolution"

A sampling:

Today's ruling class, from Boston to San Diego, was formed by an educational system that exposed them to the same ideas and gave them remarkably uniform guidance, as well as tastes and habits. These amount to a social canon of judgments about good and evil, complete with secular sacred history, sins (against minorities and the environment), and saints. Using the right words and avoiding the wrong ones when referring to such matters -- speaking the "in" language -- serves as a badge of identity. Regardless of what business or profession they are in, their road up included government channels and government money because, as government has grown, its boundary with the rest of American life has become indistinct. Many began their careers in government and leveraged their way into the private sector. Some, e.g., Secretary of the Treasury Timothy Geithner, never held a non-government job. Hence whether formally in government, out of it, or halfway, America's ruling class speaks the language and has the tastes, habits, and tools of bureaucrats. It rules uneasily over the majority of Americans not oriented to government.

And dig this from Russell K. Nieli:

Participation in such Red State activities as high school ROTC, 4-H clubs, or the Future Farmers of America was found to reduce very substantially a student's chances of gaining admission to the competitive private colleges in the NSCE database on an all-other-things-considered basis. The admissions disadvantage was greatest for those in leadership positions in these activities or those winning honors and awards. "Being an officer or winning awards" for such career-oriented activities as junior ROTC, 4-H, or Future Farmers of America, say Espenshade and Radford, "has a significantly negative association with admission outcomes at highly selective institutions." Excelling in these activities "is associated with 60 or 65 percent lower odds of admission."

Exit question: Sorry for going all pitchfork-wielding populist but how have all those Ivy League degrees littered about Wall Street and Washington D.C. been working out for this country, lately?



OK, gang. That's it for now. It's a new week so let's get to it.

College football Saturday round-up and open thread

*




Alright, gang, former fellow Seminarian, Jonesy, is back in the house with his take on this week's games and the state of college football with respect to conference re-alignment.

Greetings and Salutations,


With each week the games seem to be getting better and better. Last weeks Stanford’s 3OT win over the Trojans was the best game of the year. Throw in Georgia Tech upsetting an undefeated Clemson team, a “Hail Mary[i]” win by Ohio State over Wisconsin and the last minute drive by my Nittany Lions[ii] and you had the best day of the season. It seemed like momentum was building towards another outstanding weekend of football. Especially with the de facto BCS Championship play-in game between #1 LSU & #2 Alabama.

Unfortunately, aside from that game, not much else on the docket excites me. I’m not all that interested in seeing Oklahoma State demolish a plucky Kansas State team. Nor am I all that excited about seeing a depleted South Carolina team play an over-rated Arkansas.

Or am I? Maybe, just like my beloved Lions, I’m waiting in the weeds as higher ranked teams fall this weekend. Maybe on my trip to Vegas I will lay down some money at 100-1 odds that PSU will run the table and, through numerous happenstances, get to revenge its early season loss against Alabama in the BCS Title game. Stranger things have happened[iii].



Non Football Football Thought

I decided to take a little tangent from covering the games on the field and spend some time coving the games off the field, i.e. the continuing conference musical chairs. Here is my take on the winners and losers of this latest (but surely not last) round.


Winner: The Big 10+2. Who would have thought this conference would become the big winners just a couple of months from nearly imploding. I’d trade the perennial over-rated Texas A&M (4th best team in the state) for TCU (2nd best[iv]) any day of the week. Further, with Missouri’s seemingly suicidal intent to jump into the SEC[v], the Big 10+2 gets a huge upgrade with the far superior (in both football and hoops) West Virginia addition. Yes, it makes little geographic sense to add WVU to this Southwestern & Midwest based conference. However, WVU[vi] had little choice in the matter with the ongoing collapse of the Big Least. All in all, the Big 10+2 came out way ahead.


Loser #1: SEC. Yes, you heard right. The SEC lost this round. Sure A&M “opens” up the Texas market. But really, the badass SEC had to settle for this program. Getting UT or Oklahoma would be big, A&M, not so much. And don’t even get me started on Missouri. These Big 10+2 rejects don’t belong playing Florida, Georgia, Alabama etc. Basically, the conference picked up a couple of homecoming opponents that should quickly settle in the bottom tier along with Ole Miss and Vanderbilt.


Loser #2: The Big Least. Why couldn’t they just fold up their football operations and concentrate on basketball. Even with the loss of Syracuse and Pitt, they are still the premier hoops conference in the country. But no, they had to go for the leftover scraps like Central Florida, SMU and Houston. These teams are afterthoughts in their own cities and states. And don’t get me started on Navy and Air Force. Listen, like most normal Americans, I love the Academies. As a graduate of one myself, I know how hard it is to handle both football and the heavy academic and regimental workload. But football wise, they don’t really add much of anything to this conference. Finally, we get to Boise State. A top program that can play with anyone. I just think it’s ridiculous that they are going to be playing multiple games each year in Connecticut, New Jersey and Florida. It makes no sense.

**




Games I’ll be Watching

LSU at Alabama: These are the two best teams in college football this year (by a wide margin) and I can’t wait. Like most occasions, I have no idea who is going to win. I’m pulling for Alabama primarily because I usually root for the home team and I’d like to see a team that beat PSU finish #1[vii].


Oregon at Washington: I simply will watch to get a feel for next weeks Oregon at Stanford game. Seeing Oregon play against a decent common opponent might provide some insights into who will win next week in the battle of Top 10 teams. Besides, there is always the chance of an upset.


Texas Tech at Texas: Like I said, slim pickings this weekend. I’d like to see this matchup of high scoring offense verses rugged defense. Plus, for some reason I take pleasure in seeing Texas, with all its resources, struggle this year to stay relevant and keep its alumni happy.



That’s about all I have this week. I hope you enjoy the games. Next week, I plan on covering the new and exciting world of watching games I bet on legally from the sports book in Vegas.

***

[i] Is it really a Hail Mary if there is still time on the clock, the losing team only needs to get into field goal range and the pass play that won the game was the result of a horrible blown coverage by a weak-ass defense? I’m just asking.

[ii] Actually, the PSU-Illinois fumble-fest might have set the Big 10+2 back a few years. It was not as bad as the infamous 6-4 Iowa win over PSU but it wasn’t good. At least the good guys won this time.

[iii] Not really. But I am going to lay some money down on this bet just to show my faith.

[iv] I’d rank the programs Texas, TCU, Texas Tech and then A&M. That’s just me. Tech has had more recent success than the Aggies have had in years.

[v] Still pending but looking like a foregone conclusion.

[vi] West Virginia also made the smart hire with their head coach who has strong ties to the Texas and Oklahoma recruiting region.

[vii] This provides me with the completely unjustified idea that PSU could be the 2nd best team in the country.

(ed. note: That's right folks, as you read this, we're coaching up Jonesy on the finer points of legalized gambling. No more bookies or shylocks, for this weekend, at least.

We're absolutely baffled as to why the SEC decided to pick up A&M and Missouri. The SEC, because of their dominance in football over the rest of the country, was the only conference in the nation that could afford to set back and do absolutely nothing... zip, nada, zilch with respect to conference expansion. Those two schools bring nothing to the table with respect to football and the SEC loses a bit of its regional identity along with it. There was nothing to be gained by bringing aboard those two schools. Dumb move.

Gambling advice: Alabama vs. LSU. This game is going to come down to a late field goal. Take LSU getting 5 points at Alabama.)



* Alabama running back, Trent Richardson

** Oklahoma State wide receiver, Justin Blackmon

*** Oregon running back, LaMichael James

More great moments in the history of crony capitalism

We suppose the good news here is that potentially only $43 million will be lost as opposed to the over $500 million that was sunk into the doomed-to-failure Solyndra outfit here in California.

Beacon Power Corp filed for bankruptcy on Sunday, just a year after the energy storage company received a $43 million loan guarantee from a controversial Department of Energy program.

The bankruptcy comes about two months after Solyndra -- a solar panel maker with a $535 million loan guarantee -- also filed for Chapter 11, creating a political embarrassment for the administration of President Barack Obama, which has championed the loans as a way to create "green energy" jobs.

Beacon Power drew down $39 million of its government-guaranteed loan to fund a portion of a $69 million, 20-megawatt flywheel energy storage plant in Stephentown, New York.

There are several key differences between the two loans, an Energy Department spokesman said on Sunday, noting the Beacon plant continues to operate, unlike Solyndra, which shut down shortly before filing for bankruptcy.

The Energy Department also had agreed to restructure Solyndra's debt in a last-ditch effort to keep the company alive, a deal which put taxpayers behind $75 million in private investment. But for the Beacon project, the government loan is the first debt the company must pay, the spokesman said.

(italics, ours)

It's comforting to know that in running this green jobs picking winners and losers program, the Dept. of Energy is becoming a little more PR-savvy in recognizing that it's important that the tax-payer recoup at least some of their "investment".


Oh, and about that crony capitalism thing, just how was it that Beacon Power secured that loan?

Beacon is using the money to develop a 20 MW regulation plant at a site in Stephenton, NY. The site will use several 1 MW flywheels to store energy as well as electrical and technological equipment.

Company spokesman Gene Hunt said Beacon didn’t have financial advisors per se, just its outside law firm of Edwards, Angell, Palmer & Dodge. “We also used our in-house expertise and we have good relationships with our congressional members.”

Per se!


For those of you scoring at home: the afore-linked Solyndra, SunPower, Fisker, Lightsquared and now Beacon Power.

Stacking up like cord wood.


H/T: Hot Air

Do you have to know the secret handshake to get into this club?

Here's Ray Lane, the Chairman of Fisker, the electric car manufacturer that recieved a $529 million loan guarantee from the Department of Energy to build its cars in Finland praising the Obama administration's use of tax dollars in private investment and using, wait for it... Solyndra as proof of its success in an interview back in March of 2009.

"Policy - government/private capital cooperation is actually beginning to work."


"It would be silly to think we could start these car companies and build them to full deployment with all the capital required without the help of the government in policy decisions to support U.S. jobs actually manufacturing cars in the United States."

In a sense, Lane is right. It sure would be silly to think Fisker was going to be building cars, their two main models costing $97,000 and $57,400 a piece, without being subsidized because what private investor in their right mind is going to sink his money into that?

Unfortunately, those subsidies are your tax dollars serving to prop up a technology and a business model that is not market-ready. Who is going to buy these cars except super-rich, smug limo-liberals?

And it's terrific they all seem to know each other. As Lane suggests, this crony capitalism thing is pretty damn peachy but unfortunately what winds up happening is that billions and billions of dollars are flushed down a black hole of the politically-connected and cock-a-mamie car companies building a product overseas that no one can afford.

If the technology and business model were market-ready then government subsidies would not be needed, as it stands then, when the government picks winners and losers, they invariably choose the losers.

Yet another green technology (overseas) boondoggle

*


On the bright side of things, we guess we should be thankful that they have not yet gone out of business like Solyndra or are massively in debt like SunPower.

With the approval of the Obama administration, an electric car company that received a $529 million federal government loan guarantee is assembling its first line of cars in Finland, saying it could not find a facility in the United States capable of doing the work.

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."

This really is old news as this loan to Fisker and the fact the cars would be built over in Finland was reported out on these very pages over two years ago..


And political connections, you ask? But, of course:

The loan to Fisker is part of a $1 billion bet the Energy Department has made in two politically connected California-based electric carmakers producing sporty -- and pricey -- cutting-edge autos. Fisker Automotive, backed by a powerhouse venture capital firm whose partners include former Vice President Al Gore, predicts it will eventually be churning out tens of thousands of electric sports sedans at the shuttered GM factory it bought in Delaware. And Tesla Motors, whose prime backers include PayPal mogul Elon Musk and Google co-founders Larry Page and Sergey Brin, says it will do the same in a massive facility tooling up in Silicon Valley.

Tens of thousands of luxury sedans and mass-produced sedans at... $97,000 and $57,400 a copy? Let us know how that works out.


And proving just how affordable green technology is becoming, the reported prices for those cars two years ago was $89,000 and $40,000, respectively.

And here's what was said with respect to the prices of the cars at the time (link above):

The Karma will target an exclusive audience -- Gore was one of the first to sign up for one. Mr. Fisker says all new technology starts out being expensive. He pointed to flat-screen televisions that once started at $25,000 but are now affordable to the mass market.

And our response:

It’s not entirely clear to us that $40,000/unit falls under the mass audience category but who the hell cares about the masses when one of the main beneficiaries of your largesse has dutifully signed up to have that thing sit in his driveway?

Think about it: billions upon billions of dollars in subsidies and the prices are going in the wrong direction unlike other areas of the tech sector (TVs and cell/smart phones) where no subsidies were received and real skin was in the game and the market determined the winners and losers.

Federally-subsidized green technology: Rising consumer prices, shipping jobs out of country and hooking up your buds... What's not to like about that?




* The Karma, Fisker's luxury sedan at the San Diego Auto Show in December of 2009. Yep, Karma's a bitch.

Nice car company you got there... shame if anything happened to it

About a week and a half ago we posted a Ford Motor Co. commercial that took a not-too-veiled swipe at the bailouts received by Ford's domestic competition, General Motors and Chrysler.

Ford driver "Chris":

“I wasn’t going to buy another car that was bailed out by our government. I was going to buy from a manufacturer that’s standing on their own: win, lose, or draw. That’s what America is about is taking the chance to succeed and understanding when you fail that you gotta’ pick yourself up and go back to work. Ford is that company for me.”

If you clicked on the link, you would've found that the video has been removed by the user.



Hmmmm....

As part of a campaign featuring "real people" explaining their decision to buy the Blue Oval, a guy named "Chris" says he "wasn't going to buy another car that was bailed out by our government," according the text of the ad, launched in early September.

"I was going to buy from a manufacturer that's standing on their own: win, lose, or draw. That's what America is about is taking the chance to succeed and understanding when you fail that you gotta' pick yourself up and go back to work."

That's what some of America is about, evidently. Because Ford pulled the ad after individuals inside the White House questioned whether the copy was publicly denigrating the controversial bailout policy CEO Alan Mulally repeatedly supported in the dark days of late 2008, in early '09 and again when the ad flap arose. And more.

With President Barack Obama tuning his re-election campaign amid dismal economic conditions and simmering antipathy toward his stimulus spending and associated bailouts, the Ford ad carried the makings of a political liability when Team Obama can least afford yet another one. Can't have that.

The ad, pulled in response to White House questions (and, presumably, carping from rival GM), threatened to rekindle the negative (if accurate) association just when the president wants credit for their positive results (GM and Chrysler are moving forward, making money and selling vehicles) and to distance himself from any public downside of his decision.

In other words, where presidential politics and automotive marketing collide — clean, green, politically correct vehicles not included — the president wins and the automaker loses because the benefit of the battle isn't worth the cost of waging it.

Whether or not Ford supported and/or still supports the bailouts with respect to this situation is completely irrelevant. This represents yet another danger of corporatism/crony capitalism: the inherent thuggish nature of cronyism when the competition starts making you and your "winner", in the "picking winners and losers" schemes, look like a loser.

If you want just one more reason why the government should stay the hell out of private sector matters, count altering the business practices of the "competition" with innuendo and/or outright threats as that reason.


And we did warn driver Chris of his imminent proctology exam by the IRS. We would not want to be this guy, right now.

Great moments in the history of crony capitalism (UPDATED)

please scroll down for update...



Entrance observation: Over $500 million in loan gurantees at near-zero interest rates and they still couldn't make it work tells you pretty much all you need to know about the current competitiveness of green technology.

A politically connected solar company that pocketed a half billion dollar government loan, only to shut its doors, fire workers and file for bankruptcy, benefited from a series of breaks in securing the federal funds -- including an interest rate lower than other green energy projects, iWatch News and ABC News found.

The $535 million loan to Solyndra Inc., issued by the U.S. Department of Treasury's Federal Financing Bank, included a quarterly interest rate of 1.025 percent, the government bank reported in July. Of 18 Energy Department loans cited in the bank's report, Solyndra's rate was lowest. Eight other Energy Department projects, each also backed by the Federal Financing Bank, came with rates three or four times higher, the report shows.

That treatment is in keeping with the history of the loan to the California solar panel maker, an arrangement inked in September 2009 with great fanfare -- and touted, not long after, during a factory visit from the president. Monthly government bank reports filed since then reveal Solyndra's rate as the lowest for any energy-related project in nearly every report; in every case its rate was well below that of most energy projects, which ranged from cutting-edge electric car makers to wind and solar ventures.

The Department of Energy and Solyndra officials begged to differ saying the loan from the bank and its terms were based upon a formula and hard data such as when the loan was granted and the length of the repayment period. That would appear to be at odds, however, with evidence that Solyndra may not have been such a solid bet.

But records show the advantageous terms came in spite of red flags about the risks of investing in Solyndra. In 2008, as the loan agreement was moving forward, an outside rating agency gave the deal with a B+ grade, a less than optimum score, according to records obtained by iWatch and ABC under the Freedom of Information Act. That same year, the records show, Dun & Bradstreet assigned the company's credit appraisal as "fair."

Analysts say there were warning signs about the deal from the start, when Obama's Department of Energy pitched its first energy loan guarantee as a symbol of the expanding green tech movement. Yet the administration repeatedly took steps that would seem to benefit Solyndra: the Department of Energy announced its loan commitment before all due diligence was completed -- later raising concerns from auditors; the president made a personal visit to tout the company's prospects; and the department agreed to grant Solyndra fast-track approval.

And about that Federal Financing Bank?

The Federal Financing Bank, created by Congress in 1973 as a part of Treasury to reduce the cost of borrowing, referred questions about the Solyndra loan to Treasury. "We don't talk to journalists," a Bank employee told iWatch last week.

Transparency!

And now the money shot you've all been waiting for:

Solyndra's most prolific financial backer is George Kaiser, an Oklahoma oil billionaire who was a bundler of campaign donations for Obama's 2008 race. Kaiser's Argonaut Ventures and its affiliates have been the single largest shareholder of Solyndra, according to SEC filings and other records. The company holds 39 percent of Solyndra's parent company, bankruptcy records filed Tuesday show.

Under terms of the bankruptcy filing, investors including Argonaut -- which led a $75 million round of financing for Solyndra earlier this year -- will stand in line before the federal government and other creditors.

"federal government" = "your tax dollars"

And dig this:

Questions have long persisted about why Obama chose Solyndra to be the first green energy company to benefit from the federal loans program. In May, iWatch and ABC reported that the Energy Department announced its commitment to back Solyndra without first receiving full marketing and legal reviews. That shortcut drew criticism from government auditors, who accused DOE of favoring some applicants, like Solyndra, over others.

And Obama's Office of Budget and Management viewed the deal as riskier to taxpayers than DOE had, iWatch found.

(italics, ours)


As would be expected, Kaiser is staying mum on this whole deal.

So, if you're scoring at home, you have over a half billion in federal loan guarantees largely up in smoke, 1,000 jobs neither created nor saved and most likely, a congressional investigation into an apparent sweetheart deal for a heavyweight Presidential donor.

Because of the lack of competitiveness of green technology in its current state, it remains the greatest example of the federal government picking winners and losers, though, unfortunately, we have yet to see any winners even as designated so by the federal government.



(UPDATE #1): Thank god for bridges, roads and choo-choo trains because we don't think the President will be talking a whole lot about green jobs tonight in his jobs speech.

FBI agents armed with search warrants descended Thursday morning on bankrupt solar company Solynrda.

The investigation comes after a request by the Department of Energy's inspector general, FBI spokesman Peter Lee told NBC Bay Area News.

Agents arrived at Solyndra at 7a.m. and were examining the factory. Solynrda has a skeleton crew of 100 workers on the scene, who are closing the factory down.

"It's been an interesting [two weeks]" says Solyndra spokesperson Dave Miller, referring to both the bankruptcy and the FBI raid. "I don't know what they're looking for...but I haven't seen them take anything."

Solyndra filed for bankruptcy last week, shocking both workers and the Obama administration, which had given the startup $535 million in low interest loans.

The announcement was a devastating blow to Mr. Obama who is set to deliver a speech on job creation Thursday evening.

Congress has demanded a hearing into the matter. Wednesday the company was reported to be for sale.

There are no reports of any arrests at this time.

Solyndra officials made numerous visits -- 20 -- to the White House, according to logs and reporting by The Daily Caller.

Solyndra officials in the logs included chairman and founder Christian Gronet and board members Thomas Baruch and David Prend, according to the Caller.

OK, here's the part where we are going to sound totally paranoid: Wow. That didn't take long. Mere days after filing for bankruptcy the FBI comes swooping in. Really? We're all for quick action and everything but considering who the FBI ultimately answers to, we can't help but think this is all a little too good to be true. Totally paranoid, right?

H/T: W.C. Varones