published Thursday, February 2nd, 2012

Another 'green company' flops at U.S. taxpayer expense

On Jan. 26, the parent company of yet another "green energy" concern that got vast subsidies from the federal government filed for bankruptcy protection. Ironically, the company, Ener1, took that painful step exactly one year after Vice President Joe Biden visited its plant in Indiana and declared that it was changing "the way Americans power their lives," ABC News reported.

So much for "change."

A subsidiary of Ener1, EnerDel, which makes batteries for electric cars, got a $118 million grant from the failed federal "stimulus." But demand for electric cars has been much lower than either the Obama administration or the manufacturers of the expensive vehicles hoped, even with subsidies for the production of the cars and huge tax credits for buyers.

In the words of the CEO for Ener1: "[T]he marketplace did not evolve as quickly as anticipated. Our business plan was impacted when demand for lithium-ion batteries slowed due to lower-than-expected adoption for electric passenger vehicles."

And that is one of the best reasons why Washington shouldn't be in the subsidy business in the first place: Consumer choice won't necessarily go in the direction that government might wish it would. The Obama administration wants Americans to buy vehicles that supposedly will cause less "global warming." Meanwhile, consumers are interested in price, comfort, style, practicality and a host of other factors that cannot all possibly be sorted out and accounted for by government bureaucrats.

We saw the same thing with the bankruptcy filing of Solyndra, a California solar panel manufacturer that was supposed to create lots of good jobs. It collapsed despite getting half a billion dollars from taxpayers, because demand for its products simply didn't materialize as projected. Worse still, Solyndra is the target of a federal criminal probe over whether it got its massive infusion of tax dollars for political reasons, even though it was clear it was having financial difficulties.

"Instead of producing thousands of 'clean energy' jobs, the administration's loan guarantee and grant programs are yielding another bankruptcy and the squandering of taxpayer dollars," U.S. Rep. Cliff Stearns, R-Fla., said of the Ener1 boondoggle.

We don't wish bankruptcy on any manufacturer, but when taxpayers are left on the hook for hundreds of millions of dollars after the collapse of a subsidized company, the pain is needlessly multiplied.

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Actually it's the parent company, not the specific one funded by the energy development fund, which was created during the Bush Presidency. Of which this amount is a tiny fraction. Why don't you mention the OTHER companies which are doing fine? Does that upset your narrative?

Tell you what though, you can have the 118 million back after you collect on the billions lost subsidizing the oil companies in the Middle East.

When are you going to do that? Or do you think that Aircraft carriers are in the Persian Gulf for some other reason?

BTW, style decisions? That's something car companies work on regardless of what's powering the vehicle. That is indeed their problem. Things like safety, efficiency, that's in the national interest though. Sorry, but we citizens are on the hook regardless of what decision is made. Either we're spending billions gathering fossil fuels from overseas, pillaging our own natural resources, or...working on other options.

February 2, 2012 at 12:08 a.m.
conservative said...

"And that is one of the best reasons why Washington shouldn't be in the subsidy business in the first place: Consumer choice won't necessarily go in the direction that government might wish it would."

Great point! Lieberals and Socialists ( yes, I know they are the same ) think they know better than the free market but failure will not change their minds.

February 2, 2012 at 10:51 a.m.

You know companies go bankrupt in the free market all the time, don't you?

Even Mitt Romney, the self-proclaimed Master of Capitalism had companies go bankrupt under his stewardship.

February 2, 2012 at 12:22 p.m.

Yes Happy companies in the "private" sector do go bankrupt. But the "BIG" difference here and with Solyndra is the tax payers have to pay back 100% of their loans. All this in thanks to Obama and his administration.

February 2, 2012 at 5:07 p.m.
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