COMMENTARY | After dishing out billions of dollars in clean-energy subsidies and loan guarantees, the Obama administration has been plagued with a myriad of investment blunders, while taxpayer dollars have been squandered for reasons that seem all too political. The latest "green" energy fiasco involves a seemingly potent brand of crony capitalism, where venture capitalist and Obama fundraiser Sanjay Wagle benefited from billions of dollars in federal handouts.
The U.S. Department of Energy (DOE) supplied $2.4 billion in government funding to clean-energy firms with ties to Wagle's former company, Vantage Point Venture Partners, the Washington Post reported. The DOE funneled the taxpayer-funded dollars over a three-year period to green-energy companies that Wagle's firm had invested in. Additionally, the Post uncovered that nearly $4 billion in federal grants and financing was channeled to 21 companies backed by businesses with ties to five Obama administration staffers and advisers.
The Recovery Act, a so-called economic "stimulus" package signed by President Obama on February 17, 2009, infused some $787 billion into the economy, $80 billion of which was sidelined for green-energy projects and energy-efficiency efforts. Vantage Point's investments reaped a sizable portion of the funding, including firms such as Brightsource, which harvested a $1.6-billion loan for a solar generation plant; Tesla Motors, which was awarded a $465-million loan to build electric cars; and biofuels firm Mascoma, which pocketed $80 million to build an ethanol plant.
Clean Tech for Obama, a fundraising arm co-founded by Wagle to rally the green-energy community behind Obama during the 2008 election, paid off immensely for Wagle's green-tech ventures. Conveniently, shortly after Obama's 2008 triumph, Wagle left Vantage Point to work for the Energy Department, just as the administration launched a prodigious energy program that pumped billions of dollars into green-tech ventures.
But the Obama administration's crony-like behavior is not confined to Wagle's ambitious investment practices and compelling influence in the Energy Department.
Take, for example, venture capitalist and Oklahoma billionaire George Kaiser, who was a chief investor in bankrupt solar panel-maker Solyndra, which reaped a $535-million loan guarantee from the federal government. As the story goes, Kaiser was a prominent fundraiser for Obama's 2008 campaign, raising a reported $50,000 to $100,000 for the president.
Moreover, according to White House visitor logs, Kaiser made three visits to the West Wing on March 12, 2009, and then one more on March 13. It appears his keen political bargaining could have been a pivotal determinant for Solyndra's half-billion dollar federal loan -- which, as we now know, was a massive political boondoggle.
Unfortunately, the end of the line does not stop with Wagle and Kaiser. The Obama administration's and the Energy Department's reckless green-tech ventures have inflicted a heavy burden on U.S. taxpayers, as big-time DOE investments transformed into tumultuous failures -- while, at the same time, bigwig fundraisers who helped ignite Obama's 2008 campaign reaped lucrative rewards.