Talk about a waste of taxpayer dollars.
Last Thursday, the House Energy and Commerce subcommittee on Oversight and Investigation grilled Energy Secretary Steven Chu for five and a half hours on the Solyndra bankruptcy. Not surprisingly, Secretary Chu’s testimony showed there was no wrongdoing on the part of the Obama Administration or the Department of Energy. Even Nebraska Republican Congressman Lee Terry stated after the hearings that there was no smoking gun. So, five and a half hours of testimony and countless hours putting documents together for the hearing come up with nothing. What a spectacular waste of time and taxpayer dollars.
Despite what critics say, the DoE’s guaranteed loan program is a successful program. The default rate for the loan portfolio is less than four percent. By comparison, the loan default rate for the Small Business Administration is nearly twelve percent, three times as high as the DoE’s loan program. Secretary Chu also pointed out that the DoE faced a difficult choice when deciding to restructure Solyndra’s loan: either they could pull funding when Solyndra’s factory was half built and guarantee bankruptcy or restructure the loan in the hope that the company could pull itself out of trouble.
In fact, when the loan was restructured, two private companies gave Solyndra an additional $69 million in emergency loans. These last two loans are the only ones that will be repaid before the government, a typical arrangement in the commercial world in order to attract capital to a project restructuring.
Secretary Chu also clarified that the actual cost to the taxpayer of DoE's loan program will be roughly $2.5 billion, which is the actual amount appropriated to the program, and not the $38.6 billion that is often cited. Considering the program has created over 60,000 jobs, it cost taxpayers roughly $42,000 per job created, much less than the average cost calculation of over $60,000 per job created.
And, though Republicans condemn the program in public, they support it in private. Committee Chairman Fred Upton wrote a letter to the DoE asking for support from the loan guarantee program on behalf of a solar company. Upton wrote the letter after the company announced it was having difficulties and was adopting a restructuring plan that would layoff 400 workers.
When the heads of Goldman Sachs, JP Morgan Chase, Morgan Stanley, and Bank of America were called before the Financial Crisis Inquiry Commission for their role in the economic meltdown, they were questioned for less than 3.5 hours. Secretary Chu, whose program has actually helped create jobs and bring us closer to a clean economic future, was questioned for 5.5 hours.
What a perfect example of Congress’s skewed priorities.