What if I told you that everything Republicans have told you about Solyndra is dangerously and embarrassingly wrong?
You’d certainly be less than shocked.
The failed loan that became the code word for smearing the Obama administration’s successful efforts to prevent a greater depression during the 2012 election was part of a program that has been remarkably successful in sparking a clean energy revolution that quietly sets records for new installations every year.
The audience for people looking for good news about the Stimulus is, unfortunately for Grunwald and America, not huge.
Republicans spent around half a billion dollars framing the most successful direct government intervention on the economy since Paul Volcker’s war on inflation in the late 70s. Democratic donors refused to answer these attacks and let the GOP move on to smear the Affordable Care Act in the exact same unanswered way.
And it turns out that program that gave us Solyndra is actually example of the government’s best attempt at dishing out loans.
In a new expose for Politico Magazine, Grunwald winds us through the netherworld of “The (Real) Bank of America” to show us how the government dishes out trillions of dollars, often with little vision and less accountability. After a few thousand words — which are well worth reading for Grunwald’s deft comic turns and sense of how the conservative notion that we shouldn’t invest in the economy has turned many of our investments into loans that are often improperly vetted and accounted for — the author gets to Solyndra.
This is when you’re supposed to boo. But cheer instead.
The Solyndra loan, derided by Republican campaign ads in 2012 as a crazy handout that reflected Obama-era “crony capitalism,” was nothing of the sort. The Bush administration originally selected Solyndra for the first federal clean-energy loan over 142 other applicants. It was an exciting solar startup that had raised $1 billion from savvy private investors like Richard Branson and the Walton family, and a slew of probes have failed to turn up any evidence of wrongdoing on its Energy Department loan. The firm’s downfall was a free fall in solar prices, which sparked a solar buying frenzy but destroyed Solyndra’s sell-high business model. Such is life in a free-enterprise economy. Government loans don’t guarantee success.
The manufactured uproar over Solyndra’s failing led to the Treasury’s Financial Asset Investment Review, which was never released. Grunwald read the report and though it found “a host of problems,” Solyndra wasn’t one.
Ironically, the loan program that produced the Solyndra debacle might be as close as government gets to the sweet spot. The Energy Department recently announced that the $30 billion in loans it made during Obama’s first term are on track to earn $5 billion for taxpayers.
Government invested in a technology that in a way no one else would or could. And it worked.
More importantly, though, at a time when private lenders wouldn’t touch alternative energy, the program financed America’s largest wind and solar farms, a factory for Tesla Motors to build electric cars and a host of other innovative projects that reduced dependence on fossil fuels. It proved that cutting-edge low-carbon technologies made economic sense; since it backed the first five utility-scale photovoltaic solar arrays in the United States, the private sector has backed 17 more.
Many on the left will see an indictment of how the government lends money in Grunwald’s piece. Accounting procedures may be masking some of the massive risks we’re taking, especially in housing and student loans, which make up the vast majority of the public portfolio.
We may all grieve over the millions of dollars taxpayers could have earned from Tesla, if the government operated like a normal bank.
But it isn’t.
And we’ll still earn millions in taxes on sales and good jobs. This is how government is supposed to work. It’s how we’ve developed every significant technology of the last century. And we should be doing it with far more than loans. Bullet trains — for instance — are another nice start.
This is the story the right doesn’t want want you to know.
[Image by Steve Jurvetson | Flickr]