The administrations decision to subordinate debt owed by Solyndra

Leon Wolf:

The news is coming in fast and furious on the Solyndra scandal, which is now looking like it may become one of the prime campaign issues in 2012. In addition to the revelation that the Obama administration pressured the OMB to approve the loan guarantees to Solyndra in order to preserve Vice President Biden’s photo op, more details are coming out about the Solyndra’s collapse, and it looks increasingly like this was one of the most crooked government boondoggles ever. The details are so bad, the mainstream media is now giving them extensive coverage. I’ll give you the conclusion up front: when it was obvious in February 2011 that Solyndra was going to go under and someone was going to take a financial bath, the Obama administration ensured that friends and donors of Barack Obama were protected while the American taxpayers were left out to dry.

For example, ABC news is reporting that DoE officials warned before the loan was even approved (in 2009) that Solyndra would go bankrupt in September 2011, a prediction which turned out to be 100% accurate. The Obama administration ignored this warning and pressured the OMB to approve a loan to a company founded by one of President Obama’s biggest bundlers, George Kaiser, who visited the White House 16 times in the last two years on behalf of Solyndra. In the wake of Congressional hearings today, it was revealed that it was obvious that Solyndra was going to go under and that someone was going to take a bath on the entire project. In order to delay the PR debacle, the DoE secured bridge financing in the amount of $75M. In exchange for this financing, the DoE allowed the taxpayers’ interest to be subordinated to the interests of the private investors in bankruptcy.

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There is more.

The subject gets into the weeds of the Solyndra financing screw ups, but if you stick with it it is pretty revealing about how the administration and the Energy Department screwed up.  Why did they do it?  Throwing good money after bad like it was someone else's money reeks of corruption.

This administration's policies have become a target rich environment for Republicans, but this one will be hard to ignore.  While it does look like they were trying to help a political supporter, the more fundamental problem is the failure of their green energy model to produce energy or jobs while costing taxpayers a significant amount of money.