Promoted from the diaries.
After just a short time in Congress, I find myself more keenly aware of the research and reporting failures of the modern mainstream media. If a story gets more depth and attention than the typical 10 second sound bite, I admit, I’m surprised. Solyndra is no different.
There are a number of facts surrounding the Solyndra story that don’t seem to be getting any attention. A significant part of the public outrage regarding the bankrupt company isn’t centered on their failed business model or external factors; it’s the millions of taxpayer dollars that the Obama Administration lost on Solyndra after the business was doomed.
After Solyndra defaulted and they knew Solyndra was in real financial trouble, Secretary Steven Chu’s Department of Energy (DOE) staff made a decision by December 10, 2010, to subordinate $75 million of taxpayer money so more private capital could be injected into Solyndra. Subordination means that outside private investors are given superiority over taxpayers in the event of bankruptcy. At that point, $440 million of the $535 million loan guarantee already had been pumped into the company.
By law Secretary Chu wasn’t allowed to subordinate the taxpayers’ money. The Energy Policy Act of 2005 specifically states that the loan guarantee “shall be subject to the condition that the obligation is not subordinate to other financing.” It was the clear intention of Congress that taxpayers should be reimbursed first.
For a company that had already been declared in default and had a collapsed business model because the Chinese were selling their solar panels for less, one might question the sanity of private investors who gambled on Solyndra in December of 2010. Were they after Solyndra’s intellectual property (IP) rights? As a private investor and the dominant financier, could Argonaut’s support of President Obama have helped them secure Solyndra’s IP assets?
By December of 2010, these private investors were placed in first position to get the choice parts of the business – intellectual property, including proprietary information, processes, and patents – when Solyndra went under. To be fair, I’d guess that these assets likely aren’t worth billions, but one could certainly speculate they’re at least worth $75 million, which legally belonged to the taxpayers.
Without question, $170 million – at the very least – was wasted. If DOE had simply let Solyndra fail in December 2010, taxpayers wouldn’t be on the hook for $95 million of the loan guarantee that had yet to be dispersed in addition to the $75 million that was subordinated.
Why isn’t the mainstream media asking questions like these? What other questions aren’t being asked? To me, the Solyndra scandal is worthy of some good, old-fashioned investigative reporting. Where are Bernstein and Woodward? Is there no budding Mike Wallace? I will continue to try to get to the bottom of this scandal. Will the media join me?
Rep. H. Morgan Griffith, Virginia Republican, is a member of the House Energy and Commerce subcommittee on oversight and investigations.