Explaining Southern California's economy

Solyndra-gate and the reality of Green investment

I went on KPCC's AirTalk with Larry Mantle this morning to talk about the Solyndra bankruptcy and what's turning into something of a scandal. This was hot on the heels of the Atlantic's Megan McArdle and Reason's Tim Cavanaugh going after not just the politics of this sucker, but also the very notion that the Federal government should be investing in renewable energy in the first place. 

Just for background, Solyndra got a $535 million loan guarantee from the Department of Energy in 2009, four years after it was founded and well into an application process that was initiated under the Bush administration (Grist has the blow-by-blow on all this). Prior the the DOE loan, Solyndra had raised venture funding; after the DOE loan, it raised even more, eventually amounting to $1 billion. Post-bankruptcy, the Washington Post reported that the White House had been edging the DOE toward an approval, so that Joe Biden and DOE head Stephen Chu could schedule appearances. And just to make things extra juicy, a big Obama supporter and "bundler" of campaign donations, George Kaiser, has a venture fund that was heavy into Solyndra.

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Reportings: Solyndra scandal; central banks; Lehman Day

Libertarians attack! Megan McArdle at the Atlantic and my old pal Tim Cavanaugh of Reason focus on the political football that bankrupt California solar startup Solyndra has become. Megan: "Its technology was essentially a large bet that prices of silicon would stay high, making its product competitive." And Tim: "[T]he real outrage is that the government is proudly putting your money into companies that private investors are unwilling to put their own money into. Once this violation of common sense has taken place, the story can only end, as it appears to have ended here, in suffering and crime." (The Atlantic, Reason)


Central banks to the rescue! For now... "The European Central Bank said it will coordinate with the U.S. Federal Reserve, the Bank of England, the Bank of Japan and the Swiss National Bank to offer three-month dollar loans to banks through the end of this year. The move is an effort to prevent Europe's debt crisis from derailing the global economy's rebound from recession." (AP, via the LAT)

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