Democrats alone, the editors of the Washington Post remind us, aren’t responsible for the mess at Solyndra. Congress, Energy Secretary Chu told what the paper called a “Republican-controlled House committee” (wonder if they would have called the House Energy and Commerce Committee a Democrat-controlled committee when the president’s party held the majority) that Congress authorized the program during the George W. Bush administration.
This is just a reminder that Republicans have not always held true to small-government principles — and why we need organizations like the Tea Party to hold their feet to the fire. The political favoritism the administration showed to the company — and some of its backers — is just part of the scandal. The Post editors contend “the real scandal is the loan guarantee program itself“:
The United States needs alternatives to oil, for reasons ranging from climate change to national security. Shoveling taxpayer dollars into profit-seeking manufacturing companies is not the way to develop them.
You can call it crony capitalism or venture socialism — but by whatever name, the Energy Department’s loan guarantee program privatizes profits and socializes losses. It’s an especially risky approach in the alternative-energy space, where solar energy is many years from being cost-competitive with fossil fuels for most uses — and history is littered with failed government attempts to back the next big thing.
Emphasis added. Yes, they’re right, the real scandal is a government program putting its capital into the marketplace.
Now, to be sure, crony capitalism has grown considerably in our nation’s capital since January 20, 2009, but it’s been around a lot longer than that. And it’s nice to see the editors of one of the nation’s largest (and most liberal) dailies remind us of the real problem of government subsidies for private industries: they privatize profits and socialize losses.
Without putting some skin in the game, or perhaps, by putting taxpayers’ skin in the game, entrepreneurs can’t responsibly weigh the risks of their business decisions. Their cost-benefit analysis is flawed because the government is footing some of their costs — and taking care of their losses.
I am skeptical about the Post’s assertion that the United States “needs” alternatives to oil. If we needed them, private actors would develop them on their own without government support. What we do need is for the government to stop regulating the energy marketplace and allow entrepreneurs and investors, acting on their own initiative, to develop new, cheaper, cleaner and more efficient means to power our homes, our industries, our transportation and recreation.
All that said, it’s great to see a liberal newspaper embracing a key tenet of capitalism.
NB: Had planned to post on Chu’s testimony if I could confirm the impression I gained in watching/reading about it that he never acknowledged making any mistakes. Have yet to review the testimony so this may just be an impression.
The level of cronyism, corruption and cover-up in our country is starting to resemble Nigeria or a banana republic.
Consider also what just happened in a federal court in Texas. In this case, As described at http://LawInjustice.com , a Dallas business owner was involved in a civil dispute and paid millions of dollars to lawyers, and when he objected to additional fees after settling the case, they had a “friendly” judge, appointed by President Clinton, seize all of his possessions, without any notice or hearing, and essentially ordered him under “house arrest” as an involuntary servant to the lawyers and denied a jury trial. The business owner has been under this “servant” order for 10 months and is prohibited from owning any possessions, prohibited from working, etc..
The government financed a housing bubble that went totally over the top. The housing inventory in the US is well above any interest from buyers to own the inventory at nearly any price.
Retirement complexes have willing potential occupants who have to sell their homes to fund their buy-in fees and they can’t get nibbles on their homes. With the economy on the skids, we are in this situation for the foreseeable future.
Meanwhile, energy prices are climbing and the products made from oil and coal are rising in cost as a consequence. Out of curiosity, what pharmaceuticals, plastics, fertilizers, lubricants, solvents and feedstock are made from raw sunlight, wind or heat from geothermal exhaust?
Clearly, energy for electricity is critical to all of us. The world over, great minds are at work trying to crack the code for cheap, renewable energy. The alchemy in the enterprise hardly needs funding by the government.
But we are trapped in the mess which the government created by foisting houses on all the wrong people by both rewarding and threatening banks to look the other way and permitting investment brokers to bundle trash with solid products and sell them all over the planet with backing guaranteed by the full faith and credit of the American taxpayer.
And now, the same government is borrowing money and selling the bonds to itself in a FED shell game and giving the dough to the green energy universe which is being run like any enterprise that soars to great heights by buying high and selling at a great loss.
We really need to tap into the perpetual motion machine the socialists are using to fuel their spending. There must be enough excess energy there to spin off and power a weak doorbell.
Ah, to the victors go the spoils. Such has been true since the beginning of the Republic. It used to be sort of accepted, and well, vote for the scoundrels of your choice. But of late, the Liberals have come to hypocritically believe their side is a pillar of decency and rectitude, while the Right is evil and malicious – for doing the same thing. Meanwhile, the RINO establishment is indeed hypocritical too, for they do what the Democrats do, but believe that they will do it better, somehow.
It is indeed the system — and not either party that is at fault, but both. A thorough elimination of all such loan guarantees, grants, investments, etc, I don’t care what they are called, I’m sure there’s many names in divers cabinet agencies, is the only solution.
As for what America “needs” energy wise, in our time as a nation the power source has gone from beast, water mill and candle, to steam, whale oil and fiery lamps, to oil, gasoline and electricity with nary any loans and investments in those industries by government; except for infrastructure. But now, of a sudden, we must invest in this “alternative energy” as a nation, supposedly to speed it all up. And well, it’s just gone sour and rotten with corruption, cronies and collusion.
At the beginning of the Republic, the Treasury department had (I think) four employees, including the Treasury secretary. The spoils used to be smaller, as (say) a percentage of the economy, or a percentage of the working family’s wage. A lot smaller.
(continued) And we should go there again. The solution to all this isn’t rocket science: just return the Federal government to its proper size and functions.
The problem is that so many Americans don’t want to. So many Americans ride the gravy train, and so have a kind of investment in refusing to see the broken bridge with the 1,000 drop that is coming up.