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News

Obama fundraisers got 80% of green energy loans ($16.4 billion)

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Obama Economic Record November 2011
Obama Economic Record November 2011

From the Daily Beast, an article that explains how Obama rewarded many of his campaign fundraisers with green energy loans backed by taxpayer dollars.

Excerpt:

It would take an entire book to analyze every single grant and government-backed loan doled out since Barack Obama became president. But an examination of grants and guaranteed loans offered by just one stimulus program run by the Department of Energy, for alternative-energy projects, is stunning. The so-called 1705 Loan Guarantee Program and the 1603 Grant Program channeled billions of dollars to all sorts of energy companies. The grants were earmarked for alternative-fuel and green-power projects, so it would not be a surprise to learn that those industries were led by liberals. Furthermore, these were highly competitive grant and loan programs—not usually a hallmark of cronyism. Often fewer than 10 percent of applicants were deemed worthy.

Nevertheless, a large proportion of the winners were companies with Obama-campaign connections. Indeed, at least 10 members of Obama’s finance committee and more than a dozen of his campaign bundlers were big winners in getting your money. At the same time, several politicians who supported Obama managed to strike gold by launching alternative-energy companies and obtaining grants. How much did they get? According to the Department of Energy’s own numbers … a lot. In the 1705 government-backed-loan program, for example, $16.4 billion of the $20.5 billion in loans granted as of Sept. 15 went to companies either run by or primarily owned by Obama financial backers—individuals who were bundlers, members of Obama’s National Finance Committee, or large donors to the Democratic Party. The grant and guaranteed-loan recipients were early backers of Obama before he ran for president, people who continued to give to his campaigns and exclusively to the Democratic Party in the years leading up to 2008. Their political largesse is probably the best investment they ever made in alternative energy. It brought them returns many times over.

Think of it as a welfare program paid by the middle class to enrich the secular leftist millionaires and billionaires. Taxing the poor to pay for the rich. That’s what the Democrats mean by stimulus spending. And that’s why we have been running trillion-dollar deficits for 3 years with an unemployment rate of 9% or more. They got elected in order to enrich themselves, because they are motivated by greed.

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News

Obama gives $529 million loan to firm that outsources manufacturing to Finland

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From ABC News. (H/T Doug Ross Journal)

Excerpt:

With the approval of the Obama administration, an electric car company that received a $529 million federal government loan guarantee is assembling its first line of cars in Finland, saying it could not find a facility in the United States capable of doing the work.

Vice President Joseph Biden heralded the Energy Department’s $529 million loan to the start-up electric car company called Fisker as a bright new path to thousands of American manufacturing jobs. But two years after the loan was announced, the job of assembling the flashy electric Fisker Karma sports car has been outsourced to Finland.

[…]The loan to Fisker is part of a $1 billion bet the Energy Department has made in two politically connected California-based electric carmakers producing sporty — and pricey — cutting-edge autos. Fisker Automotive, backed by a powerhouse venture capital firm whose partners include former Vice President Al Gore, predicts it will eventually be churning out tens of thousands of electric sports sedans at the shuttered GM factory it bought in Delaware. And Tesla Motors, whose prime backers include PayPal mogul Elon Musk and Google co-founders Larry Page and Sergey Brin, says it will do the same in a massive facility tooling up in Silicon Valley.

An investigation by ABC News and the Center for Public Integrity’s iWatch News that will air on “Good Morning America” found that the DOE’s bet carries risks for taxpayers, has raised concern among industry observers and government auditors, and adds to questions about the way billions of dollars in loans for smart cars and green energy companies have been awarded. Fisker is more than a year behind rolling out its $97,000 luxury vehicle bankrolled in part with DOE money. While more are promised soon, just 40 of its Karma cars (below) have been manufactured and only two delivered to customers’ driveways, including one to movie star Leonardo DiCaprio. Tesla’s SEC filings reveal the start-up has lost money every quarter. And while its federal funding is intended to help it mass produce a new $57,400 Model S sedan, the company has no experience in a project so vast.

Doug Ross’ post linked to a description of the car’s features:

Yikes. The EPA has finally released its official fuel economy rating for the Fisker Karma, and it’s not high: just 52 MPGe, an all-electric range of 32 miles and 20 miles per gallon on gasoline when the battery runs dry. This is well below the numbers that Fisker reps were bandying about in past years: 67.2 mpge and an all-electric range of 50 miles.

The Wall Street Journal explains who stands to gain from these taxpayer-funded loans.

Excerpt:

A tiny car company backed by former Vice President Al Gore has just gotten a $529 million U.S. government loan to help build a hybrid sports car in Finland that will sell for about $89,000.

The award this week to California startup Fisker Automotive Inc. follows a $465 million government loan to Tesla Motors Inc., purveyors of a $109,000 British-built electric Roadster. Tesla is a California startup focusing on all-electric vehicles, with a number of celebrity endorsements that is backed by investors that have contributed to Democratic campaigns.

[…]Kalee Kreider, a spokeswoman for Mr. Gore, confirmed that the former vice president backs Fisker and purchased a Karma. “He believes that a global shift of the automobile fleet toward electric vehicles, accompanying a shift toward renewable-energy generation, represents an important part of a sensible strategy for solving the climate crisis,” she said in a statement.

Fisker’s top investors include Kleiner Perkins Caufield & Byers, a veteran Silicon Valley venture-capital firm of which Gore is a partner. Employees of KPCB have donated more than $2.2 million to political campaigns, mostly for Democrats, including President Barack Obama and Hillary Clinton, according to the Center for Responsive Politics, a nonpartisan group that tracks campaign contributions.

Officials at Kleiner Perkins didn’t return requests for comment.

We have been in a massive economic downturn that started when Nancy Pelosi took the gavel from John Boehner in January of 2007. And this is what the Democrats have been doing?

Commentary

Those who complain about corporate greed may be greedy themselves

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From the moderately leftist National Post.

Excerpt:

But what about that 99%? What responsibility do they bear for the situation the world finds itself in? The answer is: plenty. Greed doesn’t just live on Wall Street: it finds a home on Main Street too. And when people think it’s perfectly OK to take out mortgages they can’t afford, or rack up credit card debt to buy flat screen TVs, clothes and appliances, or draw on their home’s equity to finance cars and vacations, well, as they say, you reap what you sow.

[…]But you only have to crack open the business pages, or watch a reality TV show like Gail Vaz-Oxlade’s “Princesses” (about heavily indebted young women) to start questioning the moral purity of the 99%. Many of these people are the authors of their own misery: they consider credit to be cheap, if not free, money. The result is that even here in Canada, the ratio of household debt to personal income has hit a whopping 150%, up 78% in real terms in the past twenty years.

I have no pity for those heavily indebted people, in part because I was once one of them. My love affair with credit started in university. While the limit on that first card was low – $1500 – it allowed a student with a part-time job to buy things she couldn’t otherwise afford (and mostly didn’t need). After getting married, I kept spending, even cashing in my meagre RRSP to help finance the wedding. Post-divorce, I racked up consumer debt, over $15,000 at its peak, at which point I took a harsh look at myself and said: enough. At the time, I was selling my condo: I took the proceeds, paid off the debt, invested the balance, and vowed to both save and pay monthly bills in full, promises I have kept ever since.

Luckily, I got religion well before the meltdown of 2008. But many people didn’t. And this makes them responsible not only for their own problems, but those of their neighbours.

Sure, it’s easy to blame the Wall Street CEOs for bundling rotten mortgages and contriving arcane debt instruments that weren’t worth the paper they were written on. But someone took out those mortgages. Millions of people, actually, who bought more house than they could afford. Did someone hold a gun to their head? No. They were just as greedy as the 1%, only on a smaller scale.

Governments are also just as guilty. In the U.S., Fannie Mae and Freddie Mac granted mortgages to people deemed disadvantaged – minorities, the poor – in the hopes of increasing home ownership. This spurred the private sector to compete and fuelled the infamous subprime mortgage market.

The Canadians have special tax-free savings accounts that encourage them to save money instead of spending it. That’s something that we should do – provide people with tax-free savings accounts. Give people the incentive to save their money instead of spending it.