As if it were his private stash of fun-money, Barack Obama set aside $80 billion of the Stimulus boondoggle to artificially pump up the green-energy industry through a DOE administered program of grants and loans. When three of the companies that received funding, Solyndra, Beacon Power, and Ener1, each declared bankruptcy in rapid succession, a rotten stench started to waft from the DOE and the White House.
It quickly became apparent that there were numerous close connections between many of these heavily government funded businesses and Obama campaign supporters and operatives. While the cronyism and corruption appeared extensive, until recently no one had quantified the total extent of the cronyism and corruption that existed.
Thanks to some extensive research by the Washington Post, the magnitude of the scandal is now better defined. Here’s what the WaPo found:
- $3.9 billion in federal grants and financing flowed to 21 companies backed by firms with connections to five Obama Administration staffers and advisers.
- Sanjay Wagle, a venture capitalist and Barack Obama fundraiser in 2008, went to work at the DOE in 2009, and guided $2.4 billion to companies in which his former firm, Vantage Point Venture, had invested.
- David Danielson, formerly of General Catalyst, joined a DOE mission to fund breakthrough technologies and directed $105 million to three General Catalyst portfolio firms.
- David Sandalow was a highly compensated consultant in 2008 for Good Energies, a venture capital firm, before becoming an Assistant Secretary at DOE in 2009. SolarReserve, a Good Energies investment, received a $737 million DOE loan.
- Steven Spinner, got a job as an “adviser” at DOE after having been a campaign fundraising bundler for Obama. Spinner’s wife worked for the global law firm, Wilson Sonsini Goodrich & Rosati that specializes in clean technology companies. WSG&R clients garnered $2.75 billion in DOE loans, including the now infamous $535 million for Solyndra.
- Steve Westly – an Obama campaign fundraising bundler in 2008 and 2012 – was the founder of the venture capital firm, the Westly Group, and an adviser to DOE Secretary Steven Chu. Westly Group portfolio companies received $600 million in funding through the green-loan program.
- David Prend is Managing General Partner at the Boston based venture capital firm, Rockport Capital Partners. Prend also chaired a solar technologies advisory panel for the DOE, and had close ties with Energy Czar, Carol Browner. The DOE pumped $550 million into various Rockport Partners supported firms, not including Solyndra in which Rockport Partners was a 7.5% stakeholder. The DOE also funded electric-car battery company, Ener1 – a partner with Rockport portfolio car company Think - with a $118 million loan.
Within weeks of Obama’s inaugural in 2009 and with the $800 billion Stimulus already passed, the green-energy community was euphoric that the new administration would soon be passing out billions like candy at a Fourth of July parade. Wagle participated in a seminar in San Francisco in February to coach and encourage green businesses to line up at the federal trough. In spite of the economic woes already in full swing, Wagle explained that, “The recession has actually accelerated green policies” by creating an excuse for the Stimulus – the Mother Lode for funding virtually anything that was some shade of green. Wagle invoked Rahm Emanuel’s dictum that “a crisis is a horrible thing to waste,” and explained that Obama was going to take full advantage of the economic pain engulfing the nation to fund green technologies.
Holly Kaufman, CEO of San Francisco based Environment and Enterprise Strategies, also participated in the Green-Biz conference with Wagle. Reminding the attendees that George W. Bush was gone and with green-loving Democrats now in control of Congress and the White House, Kaufman said they should now “get used to success” – a quote she attributed to her good friend Nancy Pelosi. After what green-enthusiasts believe were eight years of famine, the money spigot was about to be opened full throttle according to Kaufman.
The White House pretends that it is merely coincidental that many of their political appointees were closely connected to companies that were the beneficiaries of millions and billions. These are “all professionals with expertise in clean-energy science, finance or both – but none of them play a decisional role in DOE awards and none of them are in positions of regulating the industry,” according to White House spokesman Eric Schultz.
But a former employee at the Office of Management and Budget, David Gold, told the Washington Post that explanation doesn’t hold up. “To believe those quiet conversations don’t happen in the hallways…is naïve,” Gold said. “When you’re putting this kind of pressure on an organization to make decisions on very big dollars, there’s increased likelihood that political connections will influence things.”
The one hour presentation that included Wagle and Kaufman at the 2009 San Francisco Green-Biz conference was rich with jokes and jabs over the departure of the Bush Administration. Kaufman was elated that unlike Bush, the Obama Administration was “committed to science and transparency.” That might be what it’s called in San Francisco or in Obama’s hometown of Chicago. But, in most of the rest of the country – after three years of this stuff – we recognize it for what it is….old fashioned greed, cronyism and corruption.
Our hope is that the various congressional committees and government agencies investigating the DOE green loan scandal will doggedly do their job. After the waste of billions, the taxpayers at least deserve to know the truth of just how corrupt our government has become.