Emails reveal White House concerns about Solyndra
WASHINGTON — Some White House officials were so concerned last year about the financial health of Solyndra, a solar equipment manufacturer that had received federal loans, that they warned that a presidential trip to the company’s California factory could prove a major embarrassment, newly disclosed emails show.
The emails, gathered as part of a congressional investigation into the Energy Department loan program, offer new insight into just how worried administration officials were about the $528 million loan to Solyndra — which is now in bankruptcy — and other government efforts, amounting to $16 billion in loan guarantees to promote clean energy.
The warnings came from both inside the White House — an official in the Office of Management and Budget wrote that the visit could be “embarrassing in the not too distant future” — as well as from private investors, including one Democratic campaign contributor who wrote to the White House the day before President Barack Obama’s May 2010 visit to Solyndra to urge officials to reconsider the trip.
The Solyndra loan, which was completed in September 2009 and could cost taxpayers a half-billion dollars, has come under congressional scrutiny since the company declared bankruptcy last month. The business is also under investigation for possible fraud by the FBI.
Obama, on Monday, defended the government’s investment, saying that “hindsight is 20/20” and the fact that the program involved risk was generally well known. In an interview with ABC News, he also said that the overall portfolio of loan guarantees was “doing well.”
In releasing the new emails, Democrats said they were seeking to demonstrate that there was no evidence of political favoritism toward Solyndra, whose investors include a foundation run by a major fundraiser for Obama, a connection that congressional Republicans have emphasized. The emails, though, do provide new evidence of a concern by lawmakers that the broader loan guarantee program might be troubled.
An Solyndra investor, in an email sent to the White House in late 2009, asked why the government had been willing to offer the solar startup so much money.
“One of our solar companies with revenues of less than $100 million (and not yet profitable) received a government loan of $580 million,” the investor, Brad Jones of Redpoint Ventures, wrote in December 2009 to Lawrence H. Summers, then the president’s chief economic adviser, referring to Solyndra. “While that is good for us, I can’t imagine it’s a good way for the government to use taxpayer money.”
The investment, Jones said, demonstrated broad problems with the government loan program. “The allocation of spending to clean energy is haphazard; the government is just not well equipped to decide which companies should get the money and how much,” he wrote.