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Obama’s Solyndra a Remake of a Deval Evergreen Production
“It’s like Evergreen solar on a cosmic level”
Nate Little, executive director of the Massachusetts Republican Party Jan 2011, on President Obama’s SOTU Speech
“They’re two leaders who have a similar long-term vision’’
Greg Bialecki Massachusetts secretary of housing and economic development on Deval Patrick & Barack Obama. Jan 2011
It’s a shock and a boondoggle for taxpayers. A green energy company touted by environmentalists and used as a photo-op by the chief executive is given millions of dollars of government support to “create jobs” now files for Bankruptcy leaving taxpayers paying the bill, workers out of work and pols scrambling for explanations.
Ah, but it’s not what you think, this movie is not about Solyndra it’s the story of Evergreen Solar, touted by Deval Patrick and showered with Massachusetts taxpayer funds and filed for Bankruptcy in August 2011.
Evergreen Solar Inc. filed for Chapter 11 bankruptcy protection yesterday, completing a stunning reversal of fortune for a high-flying alternative-energy company that once seemed to herald a new era for the Massachusetts economy.
It was just a few years ago when Deval Patrick made his big move to court the money losing Evergreen Solar to the state:
In 2007 Governor Deval Patrick decided to “lure” a company called Evergreen Solar to the state. In one of the largest investments the state has ever made in a private company, Massachusetts taxpayers paid Evergreen some $58 million dollars to locate a plant there. Curiously, Evergreen wasn’t even remotely profitable at the time.
Strange, the Globe story last month called it a “reversal”, yet the company was awash with red ink at the time of the deal (over 340 million+ according to the WSJ). That didn’t keep the Boston Globe from showcasing the deal as an example of Deval Patrick creating jobs:
Evergreen Solar’s CEO, Richard M. Feldt (right), says Governor Deval Patrick’s commitment to solar power played a key role in the company’s decision to expand in Massachusetts
Alas, the happy times didn’t last, it was only 19 months later that Evergreen announced that they were creating new jobs…In China:
Evergreen Solar is shifting some of its production, currently done at a plant in Devens, to China next year, after posting an $82 million loss in the third quarter.
But Gov. Deval Patrick looked at the bright side:
“I’m disappointed about the manufacturing,” Patrick said, “but I’m delighted that they will continue to grow jobs in Massachusetts and they will be a part of our emerging clean tech sector.”
The exact number of jobs to be lost wasn’t specified at the time, but 14 months later the Globe discovered the number… …all of them:
Evergreen Solar Inc., which received $58 million in state aid to open a factory in 2008 at the former military base in Devens, announced today it would shut the plant and let go 800 workers by the end of this quarter.
Naturally, conservatives were not surprised and asked questions:
Who did the analysis? Who gave the go-ahead to give the company $58MM?
And even environmental economics blogs asked questions:
All economists know that you have to tell a powerful externality (positive spillover) story to justify strategic subsidies of industries. Did the Governor commission such a study? For the “researchers” who did the study, what evidence did they provide?
However, those questions weren’t quickly answered:
The Patrick administration yesterday dragged its feet on releasing public records of its ill-fated, $58 million taxpayer investment in Evergreen Solar even as energy experts questioned why officials ignored early warnings that the firm’s new Devens plant stood little chance against cutthroat overseas competition.
“But not to worry”, said the state at the time:
Massachusetts officials noted the state may have the opportunity to recover some of the funds Evergreen received.
And, as late as March, the Governor insisted that it wasn’t a loss for the state:
The governor also disputed that the state was a net loser in the deal brokered by his administration. El-Hillow has said he may pay back some of the state assistance but not all, saying his company’s intention is to “honor” the agreement.
“I would say that the actual math of it suggests that the commonwealth just about broke even, when you consider the income taxes on the payroll, but it’s still a blow, and it’s not the commitment that they made,” said Patrick.
And I’m sure he believed it…right up ’til the end.
Michael Graham noted it could have been a lot worse if Patrick got his way:
Patrick originally wanted to give them $100 million, and in 2009 “offered Evergreen more than $76 million in grants, land, loans, tax incentives and other aid,” according to The Boston Globe-Democrat.
He’s right. It could have been worse, it could have been as bad as the remake Debra Saunders watched:
Solyndra had not turned a profit since it was founded in 2005. The plant in which Obama stood was bankrolled with a $535 million federal loan guarantee. Two months before, PricewaterhouseCoopers questioned Solyndra’s “ability to continue as a going concern.”
If the president wants to send a positive message on the U.S. economy, I wondered, then couldn’t his people have found a California company that doesn’t rely on a federal loan and actually makes money?
Bad advance work, I figured.
A month later, Solyndra canceled a planned $300 million public offering. In November, Solyndra closed its older plant and cut its workforce. Today Solyndra’s lights are out.
None of this explains the why. Perhaps it’s because neither Deval Patrick, nor Barack Obama, asked Reason Online to explain the facts of life:
Politicians are not venture capitalists, they aren’t marketers, and they certainly are not innovators. Whether or not a company succeeds or fails, is green or brown, or employs workers in America or China doesn’t matter. What matters is that this all be determined by private investors who know the risks going in and have a stake in the capital, location, and technology needed to either fail or succeed.
What this Solyndra story adds up to is just another Hollywood squeal that’s worse than the original. It does have one advantage for American viewing public:
Solyndra, unlike Evergreen, didn’t implode two months after it’s patron won re-election.
Medicare on Main Street: Medicare Access Challenge Real; Democrats Don’t Want to Admit
Medicare access challenge real; Democrats don’t want to admit
Just before August recess Health and Human Services Secretary Kathleen Sebelius and Rep. Henry Waxman together suggested at an Energy & Commerce Committee hearing (“IPAB: The Controversial Consequences for Medicare and Seniors”) that Republicans’ concern about Medicare access is overblown because past surveys of physician participation and patient self-reporting show Medicare access has been no worse than access for privately insured persons. In particular, Democrats rely on a 2010 report of the Medicare Payment Advisory Commission (Medpac).[1]
Moments earlier, however, every witness on the hearing’s opening panel—all Members of Congress—referred to issues affecting Medicare access.
Representative George Miller testified 6 million baby boomers are beginning to rely on Medicare.
Senator John Cornyn testified 42 percent of physicians in Texas are considering opting out of Medicare.
Representative Phil Roe testified reductions in reimbursement could make it “economically impossible” for physicians to remain Medicare providers.
Representative Allyson Schwartz testified the President’s Independent Payment Advisory Board (IPAB) “undermines our ability to…ensure [seniors’] access to care.”
So where is the disconnect?
The Medpac data relied upon by Democrats to play down Medicare access is several years old (2000-2009) so it cannot possibly reflect physician behavior in response to significant payment reductions relied upon in current law. A more current study on Medicare access in the Archives of Internal Medicine is of limited value for the same reason.[2]
Yet there has been a stream of recent surveys and news stories which highlight Medicare access issues.
For example:
- American Medical Association, AMA Online Survey of Physicians: The Impact of Medicare Physician Payment on Seniors Access to Care, May 2011.
- The Physicians Foundation, 2010 Survey: Physicians and Health Reform, November 2010.
- Medical Group Management Association, Medical Groups Prepare Drastic Response to Pending Medicare Payment Cuts, October 25, 2010.
- Richard Wolf, “Doctors Limit New Medicare Patients,” USA Today, June 21, 2010.
- Kristen Consillio, “Locating a Doctor Who Takes Public Insurance Proves Difficult in the Isles,” Star Advertiser, July 18, 2011.
- Lisa Zamosky, “Health 411: Medicare Guidance is Here,” Los Angeles Times, July 11, 2011.
- Todd Ackerman, “Texas Doctors Opting Out of Medicare at Alarming Rate,” Houston Chronicle, May 17, 2010.
- David Olmos, “Mayo Clinic in Arizona to Stop Treating Some Medicare Patients,” Bloomberg, December 31, 2009.
- Julie Connelly, Doctors are Opting Out of Medicare, New York Times, April 1, 2009.
And as recent as this week: Rosemary Shinohara, “Anchorage Patients Welcome Another Medicare-only Clinic,” Anchorage Daily News, August 29, 2011 (Nearly a third of Medicare beneficiaries in Anchorage do not have primary care doctors. Many refuse all Medicare patients, won’t accept new Medicare patients, or will see Medicare patients only if patients instead agree to pay fully out of pocket.)
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Spotlight Marc Siegel, “When Doctors Opt Out,” Wall Street Journal, opinion column, April 17, 2009: “More and more of my fellow doctors are turning away Medicare patients because of the diminished reimbursements and the growing delay in payments. I’ve had several new Medicare patients come to my office in the last few months with multiple diseases and long lists of medications simply because their longtime provider — who they liked — abruptly stopped taking Medicare…Of course, we’re promised by the Obama administration that universal health insurance will avoid all these problems. But how is that possible when you consider that the medical turnstiles will be the same as they are now, only they will be clogged with more and more patients? The doctors that remain in this expanded system will be even more overwhelmed than we are now. I wouldn’t want to be a patient when that happens.” – Dr. Marc Siegel, professor of medicine, NYU Langone Medical Center |
Furthermore, it is not credible for Democrats to argue Medicare access is not an issue because it is no worse than access for others.
For example, even using Medpac’s most current numbers, 32 percent of Medicare beneficiaries did not receive urgent care (39 percent for routine care) as soon as they wanted in a clinic, emergency room or doctor’s office. Fourteen percent of Medicare beneficiaries reported delays in getting appointments for illness or injury and 21 percent for routine care. The data also show 22 percent of Medicare beneficiaries had difficulty finding a new primary care physician and 12 percent finding a new specialist.[3]
Are these not access problems simply because people with private insurance have similar experiences? Medicare beneficiaries are older, less healthy, and require more care than younger people with private coverage.[4]
Democrats’ attempts to downplay concern for Medicare access in the face of growing evidence denies the importance of the program in people’s lives and the unique needs of the Medicare population.
Key Take-Aways
- Medicare access is a real and growing problem.
- Medicare access will likely worsen because of significant physician payment cuts relied upon in the Democrats’ takeover of healthcare law.
- Access for Medicare beneficiaries has special significance on account of beneficiaries’ age, health status, and related care needs.
From GOP.gov
Maxine Waters: “We Need a Jobs Program of a Trillion Dollar or More” (Video)
From Gateway Pundit:
She’s a true democrat.We all know the democrat solution to every problem is to spend more taxpayer dollars.
Visit msnbc.com for breaking news, world news, and news about the economy
Rep. Maxine Waters believes we need to blow another trillion dollars to jump-start the economy.
The far left politician was on Meet the Press this morning, via The Right Scoop:
Paul Krugman and the Ozone Fairy
From Hot Air:
Pres. Obama abandoned a controversial new proposed EPA rule regarding so-called ground-level ozone on Friday, angering lefties in general and environmentalists in particular. Nobel Prize-winning economist and former Enron adviser Paul Krugman is among those in despair, arguing the decision is “definitely a mistake” as a matter of economics:
[T]ighter ozone regulation would actually have created jobs: it would have forced firms to spend on upgrading or replacing equipment, helping to boost demand. Yes, it would have cost money — but that’s the point! And with corporations sitting on lots of idle cash, the money spent would not, to any significant extent, come at the expense of other investment.
The proposed EPA rule did contemplate that a lot of money be spent. Indeed, House Speaker John Boehner singled out this proposal in a recent letter to Obama precisely because the estimated cost ran as high as $90 billi0n per year. But Krugman’s argument has at least one itsy-bitsy little flaw: the technology required to meet the standard EPA proposed does not exist. Yes, really. Here’s what the EPA had to say about it (.pdf):
Why Government Incentives Won’t Spur Much Hiring
From CNBC:
Small business owner Bill Thompson says he doesn’t need a government plan to get him to hire more workers—what he needs is for the economy to get back on track.
“I really don’t need incentives. What I need is for there to be activity going on and I’ll go out and get the business,” said Thompson, who heads a family business called Thompson Pump in Port Orange, Florida.
At the start of the year there had been some cautious optimism among economists and businesses that improving momentum in the U.S. recovery would coax companies into hiring in larger numbers.
But the recovery has slowed to a crawl, and consumer and business sentiment has eroded along with it. The drop in confidence appears to have fed through to the already anemic labor market. Data on Friday showed the economy created no new jobs in August.
“There is still an abundance of caution,” said Rob McGovern, chief executive of Jobfox, a social network recruiting website. “In January, corporate leaders were thinking they were out of the woods. Now, everyone’s afraid they’re going back into the woods.”
Labor unions adjust to new reality under Obama
From Yahoo News:
WASHINGTON – In the early days of the Obama administration, organized labor had grand visions of pushing through a sweeping agenda that would help boost sagging membership and help revive union strength.
Now labor faces this reality: Public employee unions are in a drawn-out fight for their very survival in Wisconsin, Ohio and other states where GOP lawmakers have curbed collective bargaining rights.
Also, many union leaders are grousing that the president they worked so hard to elect has not focused enough on job creation and other bold plans to get their members back to work.
“Obama campaigned big, but he’s governing small,” said Larry Hanley, president of the Amalgamated Transit Union.
Labor remains a core Democratic constituency and union leaders will stand with Obama in Detroit this Labor Day, where he will address thousands of rank-and-file members during the city’s annual parade Monday.
But at the same time, unions have begun shifting money and resources out of Democratic congressional campaigns and back to the states in a furious effort to reverse or limit GOP measures that could wipe out union rolls.
The AFL-CIO’s president, Richard Trumka, says it’s part of a new strategy for labor to build an independent voice separate from the Democratic Party.
Looks like the Unions are look for someone more progressive than Obama, problem is, only self proclaimed Socialist Bernie Sanders fits the bill and he’s never going to be president.
Maybe Trumka can move his whole operation to Venezuela… I’m sure Hugo Chávez is open to the strategies the AFL-CIO under Richard Trumka are looking for.
Obama’s Close Ties to CEOs Whose Firms Dodge Taxes
From TaxProf Blog:
Following up on Thursday’s post, 25 Corporations Paid Their CEOs More Than They Paid the IRS:
- Huffington Post, Obama’s Close Ties To CEOs Whose Firms Dodge Taxes:
As the nation struggles with a stagnant economy, President Barack Obama has preached overhauling the U.S. tax code to spur economic growth. But as he gears up for what looks to be a tough reelection campaign, the president has surrounded himself with the current loophole-riddled system’s prime offenders: corporate executives whose companies have profited off of those loopholes while reaping millions for themselves.
Institute for Policy Studies, a liberal think tank, named in a new report 25 major American corporations whose CEOs were paid more last year than their firm’s total U.S. income tax bill. Of those business elites, 10 have substantive ties to Obama — including some who have official economic policy advisory positions in his administration — according to a HuffPost analysis of the report.
All told, these 10 CEOs with Obama connections brought in over $158 million for themselves last year. Their companies’ federal tax bill, however, was a combined net benefit of $5.4 billion — meaning the federal government actually owed these companies billions of dollars. Eight of the 10 firms not only did not pay taxes; they received large refunds. The 10 companies scored combined U.S. profits of $26.8 billion.
HuffPost’s calculations are based on data compiled in the report by the IPS. The IPS figures, in turn, are drawn from documents the companies filed with the Securities and Exchange Commission.
Obama has repeatedly spoken of improving the corporate tax code by closing special loopholes for politically connected companies and using that money to lower the official corporate tax rate. President Ronald Reagan embarked on a similar project in 1986, enabling the federal government to increase tax revenues even as it lowered the formal tax rates. Although corporate tax revenue is at postwar lows, Obama’s plan is much less ambitious: He doesn’t want to actually increase tax revenues at all. The benefits from closing loopholes would exclusively flow straight to other corporations.
But Obama has given several of the executives who benefit most from the current system prominent economic advisory positions. The Obama administration declined do comment for this story.
