Senior White House officials understood the risks of committing taxpayer dollars to Solyndra but proceeded anyway, according to internal Obama administration email transcripts released today.
Quotes from the emails are included in a story this afternoon by POLITICO, which obtained the documents from House Democrats, who argued that there were “no smoking guns” among the emails.
But the missives offer a sense of the willingness of White House officials to play loose with taxpayer dollars even as deficits were skyrocketing, the economy was wilting, and President Obama was trying to pass a nearly $1 trillion overhaul of the health care system.
In a Christmastime 2009 email exchange with Brad Jones of Redpoint Ventures, an investment firm with financial connections to Solyndra, then-National Economic Council Director Larry Summers acknowledged that the government was a lousy instrument for picking successful companies to invest in.
“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,” Jones wrote. “One of our solar companies with revenues of less than $100 million (and not yet profitable) received a government loan of $580 million; while that is good for us, I can’t imagine it’s a good way for the government to use taxpayer money.”
Summers replied on Dec. 26: “I relate well to your view that gov is a crappy vc [venture capitalist] and if u were closer to it you’d feel more strongly. But suppose we think there are all kinds of externalities to renewable investments. What should we do?”
The reference to a government loan of $580 million appears to refer to the Solyndra guarantee, though the number is in error. Solyndra received $535 million.
In a spring 2010 email exchange with White House senior adviser Valerie Jarrett discussing whether concerns over Solyndra’s finances should preclude a visit to the company President Obama – which he eventually made – Vice President Biden’s Chief of Staff Ron Klain suggested the White House well understood that fair percentage of the investments made in green projects would be sent down a rathole.
“The reality is that if POTUS visited 10 such places over the next 10 months, probably a few will be belly-up by election day 2012 — but that to me is the reality of saying that we want to help promote cutting edge, new economy industries.”
Jarrett had been warned by California venture capitalist Steve Westly, who raised more than $500,000 for Obama and was on a high-level DOE volunteer advisory panel on energy issues, that Solyndra was trouble.
“A number of us are concerned that the president is visiting Solyndra,” Westly wrote White House senior adviser Valerie Jarrett on May 24, 2010. “[T]here is an increasing concern about the company because their auditors, Coopers and Lybrand, have issued a ‘going concern’ letter. … Many of us believe the company’s cost structure will make it difficult for them to survive long term.”