Democrat Political Cronies profit well from Energy Department Loan Guarantees and Stimulus Spending

Posted by PITHOCRATES - July 29th, 2012

Week in Review

Thomas Jefferson did not want the federal government to have money.  This is where he parted ways with Alexander Hamilton.   Hamilton wanted to give the federal government money to spend to jumpstart American industry.  To make it an empire to rival the British Empire.  But Jefferson looked at world history and saw nothing but examples of corruption whenever money and government intertwined.  This is one reason why Washington D.C. is where it is.  Because the big financiers were in New York City.  Which in those days was on the other side of the world from Washington D.C.  Something he hoped would keep money out of the hands of the federal government.  For awhile at least.

Fast forward to today.  Where we have a bloated federal government the size of which would have sickened Jefferson.  And seeing the amount of money it spent would have killed him.  The Department of Energy guaranteeing loans?  And a trillion dollar stimulus bill?  Had he lived he would have suspected some heinous Hamiltonian plot.  For neither would have happened in a Jefferson presidency.  For he knew it would only lead to corruption.  Like it has (see Solyndra, Cronyism, and Double-Dipping on the Taxpayers’ Dime by Nancy Pfotenhauer posted 7/23/2012 on U.S. News & World Report).

Solyndra became the poster child of spectacularly poor political and policy judgment when it filed for bankruptcy, laid off a thousand employees, and left taxpayers holding the bag on $535 million in loan guarantees. In testimony Thursday before the House Committee on Oversight and Government Reform, the other shoe dropped. Apparently, many of the companies that received loans under the auspices of the same infamous program were well-established entities that essentially double-dipped to grab as many taxpayer dollars as possible…

According to Mercatus scholar Veronique de Rugy’s testimony, approximately 90 percent of the [Department of Energy’s Section] 1705 program loans went to subsidize power plants often backed by big companies with extensive resources…

Now comes the double dip: Companies such as NRG Energy Inc.—closely linked to Senate Majority Leader Harry Reid—not only received $3.8 billion 1705 loans (almost a quarter of the total), but three subentities of the same company received a total of at least 39 grants under the stimulus law…

While happily House Republicans are moving to end the Energy Department’s loan guarantee program, the Export-Import Bank, reauthorized in May in a rush of bipartisan irresponsibility, was part of the double-dipping in a particularly distressing manner.  According to de Rugy, First Solar raked in $646 million in 1705 loan guarantees through partner Exelon and landed another $547.7 million of the same from the Ex-IM bank…

…Some of the Ex-Im money went to a Canadian company named St. Clair Solar, which is a wholly owned subsidiary of First Solar. St. Clair Solar received a total of $192.9 million broken into two loans to buy solar panels from First Solar. In other words, the company received a loan to buy solar panels from itself.  (emphasis added)

Loaning money to a company so it can buy from itself?  That just isn’t right.  And $3.8 billion going to a crony of Majority Leader Harry Reid?  No wonder the Democrats are all for green energy initiatives and stimulus spending.  They get to take care of their friends.  Get some of that money in return.  And live very well courtesy of the taxpayers who they are stealing from.  Of course they will deny this.  Saying people (i.e., rich people like them) will eventually spend this money in the economy.  That when they and their friends buy expensive cars, private planes, large houses, expensive wines, vacation junkets, etc., they are creating jobs in the economy.  Generating economic activity.  Which is what a stimulus is supposed to do.  And they will say this with righteous indignation.  But what they won’t say is how much middle class economic activity their high taxes kill in the private sector.  And how much their deficit spending adds to the national debt.  Which has already lowered America’s debt rating once.  Which is just a sign of the devastation their reckless spending will cause us.  And our children.

We should follow Jefferson’s advice.  And limit the amount of money government can spend.  Defense spending?  Yes.  Intervening into the private economy?  No.  Because loan guarantees and stimulus spending don’t help anyone but those spending the money.  Our politicians.  And their cronies.  For Jefferson was right.  Nothing but corruption comes from intertwining money and government.

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