Approval of a $500 million government loan appears to have been rushed so that top officials in the Obama administration could participate in the solar panel company’s groundbreaking ceremonies and tout the President’s stimulus efforts.
“We have ended up with a situation of having to do rushed approvals on a couple of occasions. … We would prefer to have sufficient time to do our due-diligence reviews and have the approval set the date for the announcement rather than the other way around,” says an e-mail from the Office of Management and Budget to Vice President Joe Biden’s office.
The release of this and other e-mails by the House Energy and Commerce Subcommittee on Oversight and Investigations kicked off congressional hearings Wednesday into the approval of the loan to Solyndra, which recently declared bankruptcy and was raided last week by the FBI.
“It was touted as the poster child of Obama’s stimulus bill,” said Rep. Steve Scalise (R.-La.).
“In this time of record debt, I question whether the government is qualified to act as a venture capitalist, picking winners and losers in speculative ventures and shelling out billions of taxpayer dollars to keep them afloat,” said Rep. Fred Upton (R.-Mich.), chairman of the Energy and Commerce Committee.
White House spokesman Jay Carney responded to the committee’s findings Wednesday and said the only information sought by officials was to coordinate schedules.
“What the e-mails make clear is there was urgency to make a decision on a scheduling matter. It is a big proposition to move the President or to put on an event and that sort of thing, so people were simply looking for answers about whether or not people could move forward,” Carney said.
“It had nothing to—and there is no evidence to the contrary—nothing to do with anything besides the need to get an answer to make a scheduling decision,” Carney said.
Top executives of the scandal-plagued Solyndra were a no-show for the four-hour hearing, but lawyers for Brian Harrison, Solyndra president, and W.G. Stover Jr., senior vice president, told lawmakers that both officials might instead appear at another hearing next week.
Internal documents subpoenaed by the House panel during its seven-month investigation show that when the Energy Department was reviewing Solyndra’s application for the money in 2009, it was well-aware of the financial problems the deal posed, and that the White House Office of Management and Budget (OMB) was monitoring the loan’s progress.
“In fact, the White House had scheduled Vice President Biden’s and [Energy] Secretary [Steven] Chu’s appearances at Solyndra’ groundbreaking event prior to DOE [Department of Energy] even making its final presentation to OMB on the terms of the Solyndra deal,” said Rep. Cliff Stearns (R.-Fla.), chairman of the Oversight and Investigations Subcommittee.
Some Democrats on the panel insisted the company’s loan was backed by the Bush administration, although the loan was not approved until after Obama took office and was part of Obama’s shovel-ready stimulus package.
“It appears that the shovel this project was ready for, was for it to be buried somewhere,” said Rep. Michael Burgess (R.-Tex.).
Republicans said Solyndra was the hallmark of the President’s green jobs program and widely promoted by the administration as a stimulus success story, right up until its bankruptcy and FBI raid. Secretary Chu did attend the groundbreaking event on Sept. 4, and Biden spoke at the ceremony via satellite.
Obama also visited Solyndra’s manufacturing facilities eight months later and said, “The true engine of economic growth will always be companies like Solyndra.”
The committee is investigating whether the White House exerted political pressure to approve the Solyndra deal, and whether it caused officials involved in the process to miss or disregard warning signs that the company was not financially viable.
Rep. Henry Waxman (D.-Calif.), the ranking member on the Democrat side, agreed the matter should be investigated and suggested officials from Solyndra also misled him.
“We also need to ask whether Solyndra misled federal officials. In July, the company’s CEO met with me in my office. He assured me the company was in a strong financial condition and in no danger of failing. In fact, he said the company was going to double its revenues in 2011,” Waxman said.
“I have a hard time reconciling those representations with the company’s decision to file for bankruptcy one month later,” Waxman said.
Obama administration officials appearing at the hearing denied that the loan’s approval was motivated by politics.
“Developing a robust clean-energy manufacturing sector in the United States is crucial to our long-term national interests, and we need to ensure that American companies and workers are given the tools they need to succeed in this competitive space,” said Jeffrey Zients, deputy director of the White House budget office.
“This isn’t picking winners and losers—it is helping ensure that we have winners here at all. We invented this technology, and we should produce it here. The administration believes this is a battle we must fight and win,” Zients said.
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