Most of the ‘green’ is from those taxpayer loan guarantees

If you thought the woes of A-Power Energy Generation Systems, Ltd., once touted by our own Harry Reid as a firm that would build wind turbines in Southern Nevada and create 1,000 jobs, were bad — just do a news search on your favorite browser and count the number of major law firms seeking clients to sue the Chinese company whose stock is worth nil — now comes Solyndra Inc., the first solar power company to get a half-billion-dollar loan guarantee under Obama’s stimulus program.

According to The Washington Post, the House Energy and Commerce Committee voted Thursday to subpoena documents from the White House about that loan. Seems the company’s biggest investors were venture capital funds associated with Obama fundraiser George Kaiser, a Tulsa billionaire. Of course the panel vote was 14-8 along straight party lines, and one Democrat called it a fishing expedition.

Those nosy Republicans are apparently trying to show the Obama administration hastily funneled money to political backers with little regard to feasibility.

According to an Investor’s Business Daily editorial today, Solyndra got $535 million in stimulus guarantees in March 2009, the first such recipient, to hire 1,000 “green” workers to manufacture solar panels in Fremont, Calif., though the firm had never shown a profit.

Obama even visited the plant to tout it. Shortly after that, IBD reports, the company withdrew its public offering plans. Then, a few weeks later congressional auditors accused the Energy Department of giving favorable treatment to some applicants.

The Center for Public Integrity and ABC News reported in May, the Energy Department announced the Solyndra deal before getting final copies of outside reviews that were supposed to be used to vet the worthiness of the project. The story quoted Franklin Rusco, an analyst with the Government Accountability Office as saying, “There’s a consequence if you don’t follow a rigorous process that’s transparent. It makes the agency more susceptible to outside pressures, potentially.”

Meanwhile, the litigation potential mounts against A-Power, which on Oct. 12, 2010, Sen. Reid was praising for its plans to build a wind turbine manufacturing facility in Southern Nevada. For no explicable reason the Sun news story on the topic never mentioned that one of the Greenspun family companies was to be a partner in the venture. The family owns the newspaper, too.

But on Harry Reid’s website there is a quote from a March 2010 column by Sun editor Brian Greenspun:

“A-Power’s commitment to build an assembly plant in our valley, which will encourage others to follow suit, means not only energy production throughout the United States, but also significant job production here at home. It is in this context that I have been thinking a great deal about Nevada’s senior U.S. senator and the majority leader, Harry Reid … On a professional note, it is incumbent upon me to say that none of this — the wind turbine plant, the hundreds and thousands of high-paying and sustainable jobs (and construction jobs, too), the entrance of Southern Nevada in a major way into the energy business, the clasping of hands between China and the United States — would have happened without Harry Reid.”

The original column doesn’t mention the partnership either.

Those jobs haven’t happened yet.

A-Power, like Solyndra, had applied for $450 million in stimulus funds to build a wind farm in Texas.

The class action suit filed in Nevada federal court by Bernstein Liebhard LLP accused A-Power of issuing “materially false and misleading statements regarding the Company’s business and financial results. As a result of defendants’ false statements, A-Power’s stock traded at artificially inflated prices during the Class Period, reaching a high of $20.55 per share on December 22, 2009.”

Most of the lawsuits contain similar boilerplate. A recent one by the Rosen Law Firm says  “A-Power’s financial statements filed by its main subsidiaries with Chinese regulators showed less revenue and cash balances than those filed with the SEC. As a result of this adverse news, A-Power’s share price has dropped and NASDAQ has halted trading in its stock. This has caused investors substantial losses.”

I wonder whether the Greenspuns bought any stock?

The only green involved with some of these companies is the taxpayer cash lining the pockets of the company execs.

3 comments on “Most of the ‘green’ is from those taxpayer loan guarantees

  1. Steve says:

    Wonder any Reids own A-Power stocks….

    Sent from my Blackberry

  2. Probably out early … Can't find what happened to Jinxiang Lu since a new CEO was named a couple of days ago.

  3. Steve says:

    Asian tradition, fell on the sword. Perhaps a few of ours could learn a thing or two. GRIN

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