“There’s never been more money shoved out of the government’s door in world history, and probably never will be again, than in the last few months and the next 18 months, and our selfish parochial goal is to get as much of it...as we possibly can,” -George Kaiser
Slowly but steadily the media have been picking up the Solyndra story. That's the failed solar panel company that lost over $500 million of taxpayer money. PolitiFact has decided to tackle this complex issue with it's usual high standards. If you're short on time, let me give you the condensed version coming out of the
There is no scandal. But if there is a scandal, it was inherited from the previous administration.
That's right. It's Bush's fault.
For those readers with a bit more time on their hands, lets take a look at PolitiFact's recent assault on reality:
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| Image from PolitiFact.com |
PolitiFact reviews an Americans for Prosperity ad and helpfully specifies what they're going to sort out the truth of:
We decided to fact-check the ad, focusing on whether the president gave "half a billion in taxpayer money to help his friends at Solyndra, a business the White House knew was on the path to bankruptcy."
They can't screw this one up, can they? Multiple media reports have shown beyond dispute that Obama donors are closely tied to Solyndra, and also that the White House was aware of Solyndra's problems prior to the loan. So just how bad did PolitiFact flub this rating? As the indefatigable Inigo Montoya once said: Lemme esplain...No, there is too much. Lemme sum up.
Are Solyndra executives really Obama's friends?
Ben Bierman, executive vice president of operations and engineering for Solyndra, donated $5,500 to Obama’s election campaign. Karen Alter, senior vice president of marketing, donated $23,000 in 2008.
According to information collected by the Center for Responsive Politics, Solyndra board members have donated at least $27,400 to Democratic campaigns and affiliates.
Since 1998, Solyndra board member James F. Gibbons has contributed $13,500 on his own. Board member Winston Fu has contributed $4,550 since 2008. Since 1991, board member Thomas Baruch has contributed $7,150. And board member Steven R. Mitchell donated $2,300 to Obama in 2007.
What kind of crack investigative journalism did I have to perform in order to unearth this inculpatory evidence that PolitiFact was unable to find? I clicked on the link PolitiFact provided in their rating. It leads to the Daily Caller article that Americans for Prosperity used as a source for their ad. PolitiFact doesn't refudiate these claims, they simply dismiss them as irrelevant by saying only "A handful of other executives affiliated with Solyndra's management and board donated to the Obama campaign or other Democrats over the years." A "handful of executives" is enough to make the Americans for Prosperity ad True with respect to the "Obama's friends" portion of the claim. At any fact checking outfit other than PolitiFact, that is.
PolitiFact instead focuses on the big fish, George Kaiser. Throughout the unfolding scandal Kaiser has become the main target of political kickback accusations. Kaiser is a well known bundler for Obama and even donated $53,500 of his own cash to Obama's campaign. PolitiFact, however, poo-poo's Kaiser's status, writing:
For a little context, in the big-money world of presidential fundraising, he's among 560 elite fundraisers for Obama, though not in the top tier who gathered upwards of half a million each.
Kaiser's involvement with Solyndra is hardly tenuous. Simply put the George Kaiser Family Foundation is a private foundation. The investment arm of the Kaiser Foundation is Argonaut Ventures. Argonaut Ventures is the largest stakeholder in Solyndra. Dots=Connected.
But PolitiFact doesn't want you to get confused with all that messy business. They quickly point out
the clarifying facts of these prejudicial perceptions:
Kaiser, though, is neither a shareholder nor an executive of Solyndra.
That would be an excellent rebuttal if Americans for Prosperity claimed that he was. The AfP ad describes "wealthy donors with ties to Solyndra," a description that fits Kaiser perfectly.
Kaiser isn't on the foundation's board or Argonaut's or Solyndra's.
I'm noticing a pattern here.
It's important to note here that Kaiser was never in a position to profit from Solyndra...
Has PolitiFact mentioned that Mr. Kaiser would not have benefited personally in any way from his foundations investments?
"The investment in Solyndra would not have benefited Mr. Kaiser personally in any way."
Says who?
...said C. Renzi Stone, a spokesman for the foundation.
I see.
Glad we sorted that out.
Or did we?
Unfortunately our fact-furnishing friends forgot to inform us of one little thing: There is another Solyndra investor that may possibly have ties to George Kaiser. I'm speaking of the curiously named George Kaiser Family Foundation Investment Company, LLC. (Note: that's different than the George Kaiser Family Foundation.) The GKFF Investment Company is another investment arm of the private foundation. GKFF IC is invested in Solyndra to the tune of $50 million dollars. The MuniLand column at Reuters does the math:
Two of Solyndra’s largest investors are Argonaut Ventures I, L.L.C. and the GKFF Investment Company, LLC. Both firms are represented on the Solyndra board of directors by Steven R. Mitchell (see Solyndra S-1 page 119). Both are investment vehicles of the George Kaiser Family Foundation of Tulsa, Oklahoma....
George Kaiser alleges that he didn’t discuss Solyndra with any White House officials but his investment vehicles were very hot for Solyndra. I went back into Solyndra’s IPO filing and totaled up the amount of funding Kaiser’s investment businesses gave Solyndra. Over 9 rounds of financing it invested approximately $337 million, or 48% of all equity raised for the business.
Ultimately whether or not George Kaiser profited from Argonauts investment in Solyndra is totally irrelevant to the veracity of Americans for Prosperity's claim. (Though it may be relevant to understand that there can be plenty of upside in a colossal collapse). Even if Kaiser doesn't personally profit from the investment, clearly he has a vested interest in seeing that his foundations investments are successful. The fact that Kaiser visited the White House seventeen times (including four times the week prior to the loan approval) is enough to qualify him as one of "Obama's friends." Assuming the Argonaut investment was intended purely for charitable purposes doesn't make the ads claim false. And we still have the list of Solyndra executives that did donate to Obama. Whatever Kaiser's role in this mess may be it is undeniable that Kaiser is a "wealthy donor with ties to Solyndra," exactly the accusation made in the Americans for Prosperity ad.
Despite dismissing Kaiser for not being a campaign donor in "the top tier who gathered upwards of half a million", there is one Obama bundler connected with Solyndra who resides in Obama's "$500,000 plus" club. That would be Steven Spinner. According to the Los Angeles Times Spinner raised over half a million dollars for Obama's '08 campaign, took a break from fundraising, and now he's back at it, most recently setting up Obama's L.A. cash grab at the W hotel. To be fair, Mr. Spinner is not, and never was, an executive at Solyndra. Rather, during his short break from raising money for Obama, Spinner was enjoying his appointed position as a top administrator in the Department of Energy. And what was Spinner's job at the DOE? (Wait for it...) Spinner was responsible for the loan program that approved Solyndra's 535 million dollars in taxpayer money. But that's not all! Whose law firm represented Solyndra in negotiations with the DOE? None other than the lovely Mrs. Steven Spinner. But you wouldn't know that from reading PolitiFact.
Even though he signed an ethics pledge specifically regarding Solyndra, and officially recused himself from any Solyndra negotiations, Spinner's emails proved embarrassing to the White House. ABC News has the goods:
"I have OVP [the Office of the Vice President] and WH [the White House] breathing down my neck on this."
And while Spinner claims he had nothing to do with the Solyndra negotiations, he still got an attaboy from his boss at the DOE, Matt Rogers:
Thanks for driving Solyndra.
But maybe Spinner and his wife don't count as one of Obama's friends at Solyndra. They certainly weren't worth mentioning in a fact-check article sorting out the truth of any shenanigans going on, at least not to PolitiFact. But what about Ken Levit? Investors.com sums it up nicely:
In a Feb. 27, 2010, email, Ken Levit, executive director of Kaiser’s foundation wrote: “Thanks. We met with ARRA (American Recovery and Reinvestment Act, aka the stimulus bill) recovery team in (Vice President Joe) Biden’s office — the seemed to love our Brady Project — also all big fans of Solyndra.” The name of the recipient of the email is redacted.
He was a little more colorful in an email the same day to Steve Mitchell, a Solyndra board member:
“They about had an orgasm in Biden’s office when we mentioned Solyndra.”
“That’s awesome! Get us a DOE loan,” Mitchell replied.
Somehow all of this escaped our fact finding friends. See no scandal, hear no scandal, speak no scandal. What PolitiFact does have time and space for, however, is pointing out the nefarious deeds of those ubiquitous bogeymen of the left, the Waltons:
Meanwhile, Madrone Partners, which owns more than 10 percent of Solyndra, is an investment vehicle for another family — the Waltons of Walmart fame. While some argue that Walmart is no longer a conservative company that focuses solely on GOP causes, a search of Federal Election Commission records for contributions from people who list Madrone as an employer still shows most cash benefited GOP recipients. General partner Gregory Penner, for example, a Walton in-law, gave primarily to Republicans, such as $5,000 to the Senate Conservatives Fund, $10,000 to the Republican Party of Kentucky and $10,000 to McCain Victory 2008. He also made smaller contributions to a handful of Democrats such as U.S. Sen. Ben Nelson of Nebraska.Notice that earlier PolitiFact only devoted a single line to the direct donations to Obama ("A handful of other executives affiliated with Solyndra's management and board donated to the Obama campaign") yet now devotes an entire paragraph to an investment group with (supposedly) conservative sympathies donating to Republicans. Speaking of handfuls, we see that word again repeated in the final sentence, noting that a Madrone partner gave "smaller contributions to a handful of Democrats." The National Legal and Policy Center fills us in on the details PolitiFact doesn't deem worthy of reporting:
Madrone’s Greg Penner and his wife Carrie – the daughter of Walmart chairman of the board Rob Walton – most recently gave $7,200 to the successful U.S. Senate campaign of Democrat Michael Bennet, from Colorado. Mrs. Penner also donated $2,300 to President Obama’s 2008 campaign...
PolitiFact wants us to know about the donations from the Walmart group to Republicans, but the $2,300 to Obama isn't noteworthy in this fact check about taxpayer money going to Obama's friends at Solyndra.
Click the "Read More" link below to continue reading this post.
Second verse, worse as the first
So what about the portion of the claim that the White House knew Solyndra was on "the path to bankruptcy"? Emails prove Solyndra had major capital and business model problems and they were known by both the DOE and the White House. PolitiFact shoo's away the incriminating emails as gnat sized, cherry-picked distractions. But check out these gems from unnamed DOE staffers released as part of the ongoing investigation:
From an August 19th, 2009 email:
August 20th, 2009:
And note the key word here: Liquidation:
PolitiFact's take? Nothing to see here. Move along...
House Democrats responded to this idea in September, saying that "a career agency official who served in the Bush administration" had responded to the concern raised on those messages. That official's e-mail, also from August, said that equity investors, who had already pumped over $1 billion into the company, wouldn't let a short-term cash crunch keep Solyndra from finishing its project.Bush!
In other words, the government knew Solyndra didn't have, and was unlikely to generate, the capital it needed to be a profitable enterprise as it sat. They went forward with the loan because they assumed private investors would throw bad money after bad, and it would work itself out. PolitiFact thinks this was a reasonable assumption. See no cash flow problem, hear no cash flow problem...
PolitiFact also dutifully explains that funding Solyndra was a good idea in the beginning, but fell victim to an uncooperative marketplace-
The sky-high price of high-grade silicon, one of the keys to marketing Solyndra's silicon-free design, dove from almost $1,000 a pound in early 2008 to less than $100 a pound a year later, according to the Los Angeles Times. That left its technology much more expensive than competing flat panels, and paved the way for its struggle to survive.Yes, but there's a problem with this PolitiPoint: The plummeting price of silicone occurred prior to the loan approval by the Obama administration. Did the White House consider this a successful business model? PolitiFact says they did. (Of course PolitiFact never gets around to explaining why successful businesses with amazing, valuable products need to borrow money from the government in the first place, but that's for another time.)
Ultimately, despite all these "red flags" the original loan was approved on September 1st, 2009. What happened next? Was Solyndra really "a business the White House knew was on the path to bankruptcy" after the half-billion dollar loan had supposedly "primed the pump" of private capital?
The L.A. Times gives us a short timeline:
By the time the loan was conditionally approved, sinking demand for solar energy had helped drive the price of silicon off a cliff, to less than $100 a pound. Heavily subsidized Chinese flat-panel makers began slashing prices faster than Solyndra could.
Solyndra's prices were 66% higher than competing flat panels in late 2009, according to public documents filed with the Securities and Exchange Commission.
What's more, Solyndra was selling them for almost half what they cost to make in an effort to build market share, which only led to mounting losses.
The company never made a profit. By 2009, the company had lost $373 million. Less than a year later, losses grew to $558 million, enough to get auditor PriceWaterhouse to issue a stark warning about Solyndra's financial viability.
But that's not all!
Check out these beauties from Solyndra's December 2009 S.E.C. filing as reported by the Atlanta Journal-Constitution:
"We have incurred significant net losses since our inception, including a net loss of $114.1 million in 2007, $232.1 million in 2008 and $119.8 million in the first nine months of fiscal 2009, and we had an accumulated deficit of $505 million at Oct. 3, 2009,"
...
"We expect to continue to incur significant operating and net losses and negative cash flow from operations for the foreseeable future."
But that doesn't prove the White House knew Solyndra was on the path to bankruptcy before they restructured the terms of the loan, subordinating taxpayers claims to that of a private investor, right?
Jonathan Silver, executive director of the Energy Department's loan program, said DOE officials faced a stark choice late last year and early this year: Refuse to allow the loan restructuring, "thereby ensuring that Solyndra would close its doors immediately" or allow the company to accept emergency financing, "thereby giving it and its almost 1,000 workers a fighting chance at success, and the government a higher expected recovery on its loan."
...
"Without DOE's agreement to restructure Solyndra's loan, the company likely would have faced bankruptcy much earlier — in December 2010" or soon after, Silver said.
PolitiFact faithfully acknowledges that the Obama administration turned down a second loan to Solyndra, but did allow them to raise private capital, and restructured Solyndra's loan. This restructuring put taxpayers further back in line to collect in the event of a bankruptcy, and moved the new private capital to the front. What PolitiFact doesn't tell us is where that new injection of private capital came from: Argonaut Ventures. Doh! Who saw that comin'?
If that's not close enough to the White House for you, would a May, 2010 email from Steve Westley to Valerie Jarrett suffice??
“A number of us are concerned that the president is visiting Solyndra,”
“There is an increasing concern about the company because their auditors, Coopers & Lybrand, have issued a ‘going concern’ letter. … Many of us believe the company’s cost structure will make it difficult for them to survive long term.”
“I just want to help protect the president from anything that could result in negative or unfair press,”
“If it’s too late to change/postpone the meeting, the president should be careful about unrealistic/optimistic forecasts that could haunt him in the next 18 months if Solyndra hits the wall, files for bankruptcy, etc.”
PolitiFact's take on this?
[W]hile e-mails raised doubts about Solyndra's liquidity as the Energy Department finalized the loan, those questions were answered by an official who argued investors would step in to protect the project — red flags, yes. But awareness in the White House the company would dissolve? No.
Nope. Nothing to see here.
All that's left now is our Fact Finding Finale:
The TV ad says "(President Barack Obama gave) half a billion in taxpayer money to help his friends at Solyndra, a business the White House knew was on the path to bankruptcy." Some of this is correct, while some isn't supported by the existing evidence.
True. Also, the fact that Ford makes pickup trucks is not evidence that Yuengling beer is brewed in Pennsylvania.
What PolitiFact is trying to do here is ask the reader to disregard all the evidence of Solyndra executives being Obama campaign donors, like the ad claimed, and pay attention to the factoids they dug up about George Kaiser "not profiting" from his ties to Argonaut. Whatever Kaiser's stake in this debacle, the ad's claim about Obama donors being executives and shareholders at Solyndra is undeniably true. If we assume Kaiser had no influence and didn't make a penny on this deal, the ad is still correct. Try as they might, PolitiFact simply cannot split this baby.
First, the money wasn't Obama's to give. Solyndra's request predated his administration, and career Energy Department officials handled the deal.
Bush!
This has been the tu quoque meme coming from the left since the Solyndra scandal began to surface. PolitiFact jumps on the Bush started it bandwagon with little subtlety. There's no denying the DOE's loan program was created by the Bush administration and is knee deep in GOP ties. But the important number PolitiFact fails to report is the dollar figure approved for Solyndra during Bush's term: A whopping $0.00. In fact when Bush held office the Solydra deal was dead. No matter how much they spin this one the fact remains that every penny that taxpayers will lose on Solyndra came under loans approved by the Obama administration that were previously rejected by the Bush DOE.
Second, e-mails so far don't show an administration pushing through a loan to help Obama's "friends at Solyndra." Rather, it appears the administration asked the Energy Department officials to hurry the regular process, so the administration could burnish its stimulus efforts.
And it's just a magical coincidence that the biggest failure of the DOE loan program was a company run by wealthy Obama donors. Oh, did PolitiFact also forget to mention the fact that Solyndra had the lowest interest rates of all the companies that received DOE loans too? They did, but I'm sure it was a coincidence as well. Also notice PolitiFact points out the loan was only rushed because Obama was pushing so hard to get stimulus money out there working to fix the economy. The stimulus is one of PolitiFact's favorite causes, and they happily trot out the "we were in a crisis" canard to defend the Solyndra approval. Or in other words: Obama didn't do it...but he did it for a good cause.
Oh, and one more thing:
The Solyndra story might be one of the poor design of the Energy Department's loan guarantee program — something the Government Accountability Office has pointed out since 2008.
Bush!!!!!!!!!!!
Whatever failings the DOE loan program has, it worked well enough to turn down Solyndra for a loan until Obama took office.
Finally, PolitiFact ends with a bang by taking distortion to new heights:
For now, though, information in the public record does not support the ad's claim that the Obama White House is a pay-to-play cash machine for the politically well-connected. We rate this ad's claim Mostly False.
Pay-to-play cash machine?
When did the ad say that? The ad was specific, and so was PolitiFact:
We decided to fact-check the ad, focusing on whether the president gave "half a billion in taxpayer money to help his friends at Solyndra, a business the White House knew was on the path to bankruptcy."
The public record proves beyond any doubt that Solyndra's executive board was comprised of wealthy Obama campaign donors, and the White House knew of Solyndra's untenable financial situation. That's what PolitiFact claimed they were checking. By the end of the article they've moved the goal posts to the much more dramatic "pay-to-play cash machine." A description, by the way, that is purely subjective and beyond the scope of an objective determination of facts. The sophistry is jaw-dropping.
The facts are clear. It is undeniable that taxpayer funds went to help Obama's campaign donors at the upper levels of Solyndra. The White House was fully aware of Solyndra's failing business model and extreme financial problems. Only a gross distortion of truth can allow one to believe otherwise. PolitiFact's rating isn't a confirmation of facts, it is an evasion of them. Their motives are partisan, and their tactics are dishonest.
The Solyndra scandal is a rotting pile of stink in a bucket of corruption. The water PolitiFact carries for Obama cannot wash it away.
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