who pays any attention to the news knows the name Solyndra. It has
become synonymous with the overall failed green energy program
administered by the Obama team. Politicos know there are many other companies that
have received loan guarantees for various green energy projects that
have since become a source of ridicule for the White House. Some might
even be able to name a few. There is the now-bankrupt company that made
batteries for electric cars: Ener1. The plug-in electric
sports car company, Fisker, that made its cars in Finland and has troubles too numerous to
cite. And, of course, we know about the Chevy Volt—that our taxpayer
dollars bailed out only to have demand so low that Chevrolet had to pull the plug on
the production line and lay off workers for five weeks earlier this
year. But few know the full story.
the dots will make your head hurt. There are various programs and
special tax breaks and different kinds of companies that received green
energy loans: solar, wind, and geothermal; and car companies, battery
manufacturers, and biofuel producers. While the projects differ, they
have several startling similarities. The vast majority of the green
energy loan guarantees were given to companies that could not obtain
enough financial backing from private investors. Their “junk” or
“speculative” grade kept people from putting their own money into them
—yet your money and mine was given to them, and we had no say in the
matter. Of the 27 loans issued through the 1705 Loan Guarantee Program
to 21 firms, virtually all of them have “connections” to either
President Obama or other high-ranking Democrats—or both! The loans were
made to fill a market created not by free-market demand, but by
government mandates. And, all of the “special seven” got
fast-tracked approvals through the Department of Interior with little
scrutiny over environmental damages that would have taken any other
energy company months, if not years, to get, and EPA regulations were
of the companies that received the funds had involvement with large
donors and/or bundlers for the Obama campaign, and there is an amazing
revolving door through which the players pass many times. They worked,
for example, for Senator Harry Reid. Then they are on the staff of an
investment firm that invested in one, or more, of the companies. Next
you find he or she is on some White House commission—or worse, became
part of the Obama Department of Energy team. Some 460 companies applied
for DOE loans, but only 27 projects, 21 companies, got the funds. And
85% of these have been found to have “connections.” The remaining 15%
may well have connections too, albeit more guarded or hidden.
are not wild assertions. I have the data to back them up.
the publication of my column a couple of weeks ago on crony capitalism, I was
connected with Christine Lakatos. She’s a private citizen and a single
mom with a nose for research. Beginning in 2009, she was hired to work
on investigative projects, following the green energy money. But when
those projects were completed, she didn’t stop digging. She kept finding
more and more. With no outlet for her work, she started a blog where she
“brain dumps” her findings—which for a total unknown has received an
impressive number of readers. For anyone but the most stalwart, her Green Corruption Blog is
like getting a drink of water from a fire hydrant.
Sunday, some of Lakatos’ research was presented in my weekly column. The response
prompted us to begin a collaboration.
each of the next 17 weeks, we will expose one green-energy,
crony-corruption story after another (though my travel schedule may
require me to skip a week here and there). It will be a “book” released
chapter-by-chapter. If you like what you find, we hope you’ll let us
know and come back the following week for the next installment.
single stories of what we’ll expose are “out there”—though surely not
covered by the mainstream media and not all in one place or all
connected as we’re doing. If you made a study of the green-energy,
crony-corruption story your passion, you likely found out a lot of what
we’ll share. If you read the report from
the House Oversight and Government Reform Committee (HOGRC) on the Obama
Administration’s green energy gamble word-for-word, or watched the
incriminating hearings, you’ll already know some of what we’ll present.
Or, if you’ve read the chapter in Peter Schweizer’s book Throw
Them All Out that
addresses alternative energy and “how the game of funneling taxpayer
money to friends has exploded to astonishing levels in recent years,”
you have a good idea of the big picture. If you have made this your
passion, have studied the report, and have coordinated with Schweizer,
as Lakatos has, you are encouraged to help make these reports as
complete as possible. Together, we’ll connect the dots and present it
here in bite-sized pieces.
of the energy projects we will profile in the “special seven” section
were recipients of billions of taxpayer dollars through the 1705 Loan
Guarantee Program (LGP) and many will be receiving millions more through
the 1603 Grant Program. The 1705 LGP is an expansion of the 1703 program
that was approved in 2005 under President Bush—increasing the
expenditures from $17.9 billion in 2007 to $37.2
billion in 2010. The 2009 American Recovery and Reinvestment
Act significantly expanded the DOE’s authority, under Energy Secretary
Steven Chu, through the newly created 1705 LGP. (Under the Recovery Act,
$86 billion—approximately 10% of the stimulus package—was earmarked for
green energy projects.) The LGP means that companies get risk-free
money. If the company succeeds, the low-interest loan gets paid back. If
they fail—as many have—we, the taxpayers,
lose. In contrast, the 1603 Grant Program—implemented
as part the Obama stimulus––is administered by the Treasury Department,
with the goal of reimbursing eligible applicants for a portion of the
costs of installing specified energy property used in a trade or
business or for the production of income. Basically 1603 gives billions
in favored businesses tax-free cash gifts that do not have to be paid
we can prove that cronyism has run amok within the majority of 1705 LGP,
we'll stay focused on the Special Seven. Here, in Part 1, we present a
complete overview of the connecting dots on one project: SolarReserve,
LLC. With this introduction made, we’ll likely address several
companies, with a common denominator, in subsequent releases.
Sunday’s column, the following thumbnail was presented:
“SolarReserve’s Crescent Dunes project
is a solar thermal power tower plant utilizing the advanced molten salt
power tower technology with integrated storage located in Tonopah, NV.
The company's Fitch rating is BB, yet in September 2011, it was the
recipient of $737 million in DOE
loan guarantees. Obama’s law school buddy and 2008 Obama campaign
bundler, Michael Froman, was managing director of alternative
investments at Citigroup—which became a major investor in
SolarReserve. Froman currently serves on the White House staff.
Additionally, other high profile Democrats are involved with
there is more.
about Michael Froman. Peter Schweizer reports that “When Obama ran for
president, Froman helped raise large sums of money on Wall Street” for
the 2008 campaign. The HOGRC report (page 47) confirms Peter’s findings
and adds that Froman was a $200,000 bundler: “Michael Froman currently
serves as the Deputy Assistant to the President and Deputy National
Security Advisor for International Economic Affairs. He was a friend of
President Obama’s from law school, and supported his political career by
bundling over $200,000 for his 2008 presidential candidacy. Prior to his
arrival at the White House, Froman was the Managing Director of
Alternative Investments at Citigroup, where he managed infrastructure
and sustainable development investments. Citigroup became a major
investor in SolarReserve, which ultimately received a $737 million loan
guarantee in September 2011.”
Citigroup connection is tighter. Richard Parsons was
Chairman for Citigroup from 2009 until he announced stepping down in
March 2012. Citigroup was
a top Obama donor in 2008. Parsons served on the Obama Transition Team
and on the Economic Advisory Board. In 2011, Parsons was appointed to
the President’s Council on Jobs and
David Sandalow—who is currently “the Assistant Secretary for Policy and
International Affairs at DOE, where he acts as Secretary’s Chu’s
principal adviser on energy policy, as well as coordinating DOE’s
foreign policy involvement.” (HOGRC report page 49) “Sandalow’s ties to
the White House date back to the Clinton Administration, during which he
worked with President Clinton on environmental issues. After having
gained this experience, Sandalow became the influential Chair of the
Energy & Climate Working Group of the Clinton Global Initiative. He
went on to advise President Obama’s presidential campaign in 2008. Prior
to joining the Obama Administration, Sandalow was a senior advisor to
Good Energies, Inc., an energy-focused venture capital firm. Good
Energies is an investor in
SolarReserve connections to the Democratic Party include:
Pelosi—Former Speaker of the House Nancy Pelosi’s brother-in-law, Ronald Pelosi, holds a
leadership position with Pacific Corporate Group Asset Management—which
is an investor in SolarReserve.
Additionally, his colleague, Jasandra Nyker, has served
as a member of SolarReserve’s board of directors.
Kaiser—Argonaut Private Equity is an investor in SolarReserve.
Argonaut Private Equity is owned by major Democratic fundraiser and
a 2008 Top Obama bundler George Kaiser, who also invested in Solyndra.
Kaiser made multiple visits to the White House in the months before the
company was granted a $535 million loan from the government. The
Managing Director for Argonaut Private Equity, Steve Mitchell, serves on
SolarReserve's Board of Directors.
that SolarReserve paid hundreds of thousands of dollars in lobbying fees
to the Podesta Group. Tony Podesta is the principal at the Podesta
Group—which he started with his brother John.
John Podesta ran Barack Obama’s presidential transition team and is the
Director of the Center for American Progress—which is “reportedly highly influential in
helping to craft White House Policy.” Both Tony Podesta and his wife
Heather (a Washington power couple) are frequent White House
visitors that share high ranks in "lobbying power," and Democrat
bundling as well.
Bailey—SolarReserve’s Chairman of the Board is Lee Bailey, a
Managing Director with U.S. Renewables Group, who holds a significant
financial stake in SolarReserve. Bailey has donated$21,850
since 2008 to Democratic candidates, including President Obama, Senate
Majority Leader Harry Reid, California Sen. Barbara Boxer and
then-presidential candidate Hillary Clinton.
McDermott—SolarReserve board member James
McDermott is also a Managing Director with U.S. Renewables Group. He
contributed $61,500 to various Democratic campaigns
since 2008, including $30,800 to Obama’s presidential election campaign.
U.S Renewable Energy Group has ties with Senator Harry Reid.
there were only one connect-the-dots story, it would be easy to dismiss
it as coincidence. But here, with just one company, you can see the dots
connect, and connect, and connect. As you will continue to see, they
keep on connecting. In this case, connect-the-dots is no innocent
childhood game. It is a high-stakes gamble and only those with
connections get to play. Obama and his Democratic friends are the
winners. We, the taxpayers, the losers. We lose the financial investment
of our tax dollars and our electricity rates go up—all to support the
discredited ruse of man-made climate change.