The Solyndra scandal is certainly an "embarrassment" for the White House, as some network news reports have called it. But somehow those same reports have still failed to criticize Obama's green jobs programs for fiscal waste, even the government loan program that gave Solyndra millions.
To their credit, all three broadcast networks aired stories in September about the California solar company that declared bankruptcy in August after getting a $535 million loan guarantee from the federal government in September 2009. But out of 11 network stories on Solyndra this year (most in September), not a single one used the company's failure to criticize the loan program it used to get more than half a billion taxpayer dollars.
Although some of those stories mentioned that Solyndra was touted as a stimulus success story, none explicitly used its failure to argue that such green "investment" [1] programs were flawed.
Unlike the networks, print outlets have been exposing not only Solyndra, but problems with the programs that allowed this scandal to occur. According to job creation figures reported by The Washington Post, the $36.8 billion loan program has created only 5 percent of the 65,000 jobs promised and each job cost more than $5 million. Meanwhile, at least one administration spokesman absurdly claimed the program has been successful in spite of Solyndra's failure.
The Washington Examiner quoted Damien LaVera, an Energy Department spokesman, who said of Solyndra: "The project that we supported succeeded. The facility was producing the product it said it would produce, and consumers were buying the product." [2] What is stunning about that quote was that LaVera said it after the company folded, but it still didn't invite skepticism from network reporters.
Lachlan Markay [3], an investigative reporter for The Heritage Foundation, pointed out the economic problem with defining success in that way, rather than the way private businesses without government assistance would define it.
Markay wrote about LaVera's and other statements from administration officials: "The comments underscore the point I was getting at in speaking with ABC: from an economic perspective, the Solyndra loan was a failure. But if the purpose of the loan guarantee program was to get more people to invest in green technology, then Solyndra's failure has no bearing on the program's success. The merit of the program does not depend on companies succeeding or failing."
"The loan guarantee program exists in order to insulate would-be investors from the normal workings of the market, and hence to encourage more investment," Markay concluded. And that is precisely the problem, one that the networks continue to ignore.
Print news outlets including the Post have reported that the loan program is failing to meet expectations, particularly in the area of job creation. But the networks are still refusing to critically examine the overall green technology policies of the Obama administration.
Before Solyndra went under, but after a number of stimulus-financed green technology companies had gone out of business, the Business & Media Institute looked at network coverage of "green jobs" and found criticism of those policies was left out of 92 percent [1] of the 52 stories between Jan. 17, 2009, and Aug. 17, 2011.
A Growing Scandal over Solyndra
The networks have admitted that Solyndra's failure reflects poorly on the Obama administration, which approved the loan and touted the company as a model green jobs success. But only one of 11 stories actually mentioned the word "scandal." A few of the stories downplayed the seriousness by calling it an "embarrassment" or "headache" for the Obama administration.
But it is looking more serious than a "headache," based on recent print news coverage of the investigation of Solyndra. The Hill [4] reported on Sept. 20 that top Solyndra executives will plead the Fifth during a Capitol Hill hearing on Sept. 23 because the Justice Department is in the middle of investigating the bankrupt solar company.
Recent print reports have also exposed financial problems at the company going all the way back to 2007. The Associated Press reported Sept. 16 that Solyndra was "hemorrhaging hundreds of millions of dollars for years before the Obama administration signed off on the original $535 million loan guarantee [5] …"
AP even said that the company's SEC filings showed losses of $114.1 million in 2007, $232.1 million in 2008 and $119.8 million in just nine months of 2009 - suggesting that the company was not a good risk from the beginning. Yet the government approved the loan and Obama and Vice President Biden both praised the company as a success.
Earlier this year, according to AP, the Obama administration "restructured" Solyndra's loan to ensure that private investors would be paid ahead of taxpayers if the company defaulted. One of those private investors was Argonaut Ventures LLC, "an investment vehicle of the George Kaiser Family Foundation." George Kaiser is the head of that foundation and is himself a major Obama donor.
ABC and its investigative correspondent Brian Ross have done a much better job than other network reporters by breaking the story of a plant closure and layoffs at Solyndra back in March 2011 and exposing the company's close ties to President Obama. ABC has continued to expose the Solyndra scandal and recently reported emails suggesting the company was not a sound investment and the government knew that.
On Sept. 14, Ross told ABC "World News with Diane Sawyer" viewers that "New emails show the California company got its $535 million loan despite deep misgivings inside the government." One of those emails warned: "... the model runs out of cash in Sept. 2011."
But overall, the print news media are doing a much better job than the networks of exposing flaws not only at Solyndra, but with other companies and the Obama administration's policies on green energy.
The Washington Post reported on Sept. 14 that Obama's "green-tech" loan program was struggling to fulfill its job-creation goals. The newspaper said the $38.6 billion loan guarantee program used to finance Solyndra and other companies has fallen seriously short of its 65,000 job creation promise: 61,455 jobs short in fact [6]. The program has only "directly created 3,545 new, permanent jobs after given out almost half the allocated amount," The Post wrote. That's more than $5 million per job [7].
Solyndra has been under investigation [8] by the House Energy and Commerce Committee for some time, according to Politico. On Sept. 20, Rep. Darell Issa, R-Calif., announced that the Oversight and Government Reform Committee would begin an investigation of government loan programs [9] to private companies in light of allegations surrounded Solyndra and a wireless company called Lightsquared, The Hill reported.
None of this is stopping the Obama administration's efforts to give away billions more in loans to renewable energy companies before the end of the month. Bloomberg reported that $9.2 billion in loan guarantees [10] could be given away by the Sept. 30 deadline.
In that report, Bloomberg quoted Department of Energy spokesman Damien LaVera (the same DOE spokesman who said bankrupt Solyndra was a success) who said: "We want to get as many of these done in a way that responsible protects the taxpayers' interest … If they meet conditions set out in the agreement, then they'll close."