You may have heard the name “Solyndra” in the news recently. It may sound like some sort of forest princess from a fantasy novel or an exotic locale to some. The name is an attempt to cash in on the exotic nature of solar power, the supposed energy source of the future. Solyndra was a renewable energy start-up that manufactured a new type of solar panels. This sounds like a shining example of American ingenuity and entrepreneurship in the future, no? Unfortunately, the Obama administration thought the same. Solyndra received a $500 million loan from the Department of Energy in 2009. The idea for the federal government to back a company like Solyndra was not hatched in the Obama administration; in fact, it had been worked on since 2007 under Bush’s administration. Back then, it probably seemed like a good idea – the federal government needed some positive publicity in the manufacturing sector, and Obama knew that it was even more necessary after the financial collapse.
But there were warning signs of Solyndra’s demise. According to the Washington Post, Stephen Chu, Energy Secretary, approved further funds being funneled to Solyndra despite obvious problems at the company. Solyndra executives had told government officials that the company was no longer competitive, and that it would not be able to pay back the loan. However, Chu insisted that “the choice was between imminent liquidation or giving the company and its workers a fighting chance to succeed.” This is the worst possible reasoning for supporting a company. Chu considered the loan a public relations move, but it was really an investment. And no investment should ever be made when it will be propping up the company. Chu essentially threw taxpayer money onto a sinking ship, hoping that the resulting pulp would make it float.
One can only wonder how much stimulus money was wasted on projects like these. Investing in alternative and renewable energy sources is important, to be sure. But when one analyzes the situation through the glasses of a politician instead of those of a financier, the details can become blurred, and one’s goals fade from sight. This is the problem with the federal government stimulating the economy – incentives are mixed among bureaucrats, and they are rarely in the public good. Although the government is attempting to turn America into a gleaming symbol of emissions-free, herculean might, the sheen on the surface is only a facade when the inside is not carefully crafted.