In the Pipeline: 9/9/11

They are getting sloppy with embezzlement these days Wall Street Journal (9/9/11) reports: The political scandal over the failure of Solyndra, the politically connected solar-panel maker, just got a lot more interesting. The FBI raided the company’s Fremont, California offices yesterday and executed a search warrant…Congress has been investigating the company, which received a $535 million government loan guarantee in March 2009 and announced August 31 that it is filing for bankruptcy. Yesterday’s FBI raid is the first hint of a larger government probe, which is being conducted in cooperation with the Department of Energy’s Inspector General. The FBI declined to comment. A Solyndra spokesman said it was surprised by the raid and is cooperating…Solyndra was once a leading light, if you will, of the Obama Administration’s signature “green jobs” dreams. The Energy Department signed off on the loan guarantee under a George W. Bush-era law, and the Federal Financing Bank, a unit of the Treasury Department, also provided a loan with a 1.025% quarterly interest rate. A parade of Administration officials praised the investment, including President Obama, who said in a speech last year at the company’s Fremont headquarters that “companies like Solyndra are leading the way toward a brighter and more prosperous future.”…Solyndra never did turn a profit and laid off employees in November. But in February the company renegotiated its loan guarantee—with a hitch. Under the new agreement, Solyndra’s investors would loan the company $75 million but be first in line on repayment in the event of bankruptcy, in front of taxpayers…One of Solyndra’s biggest backers is the George Kaiser Family Foundation, whose namesake is an Oklahoma oilman who bundled campaign contributions from multiple sources for Mr. Obama’s 2008 campaign…In an email yesterday, an Energy Department spokesman said the government “restructured the debt to give Solyndra more time to repay and avoid default—much like commercial lenders do when a homeowner is having trouble making the mortgage payments.”…The email added that the new deal ensured that “no additional taxpayer funding was used,” that Energy received “substantial additional collateral protection in the form of intellectual property, claims on the parent company and more,” and that the deal “permitted the company to complete, equip and begin operating its plant, which increased its value in any future liquidation or sale.” Sounds like Energy officials already feared Solyndra might go belly-up.

You have to love Ed Rendell (Penn ’65).  “You guys are screwing up.  But if you cut us in for a piece of the action, we can look the other way.” Gazette (9/8/11) reports: Former Gov. Ed Rendell closed out the first day of the Marcellus Shale Coalition’s inaugural conference on a fiery note, saying gas drillers have continued to “screw up” for too long and that they should be more loudly supporting a tax on their industry…A sharp rebuke from the Democratic politician who oversaw the beginning of the commonwealth’s Marcellus Shale exploration was an unexpected end to a day of industry-sponsored sessions touting the new jobs, technology and investments from natural gas drilling…Mr. Rendell, who handed over the reins to Republican Gov. Tom Corbett in January, pointed to the protesters outside the convention center around midday Wednesday as an example of how the activists have grown into “a serious, long-term problem.”…”[Drillers have] screwed up so bad that there are protesters everywhere anybody associated with this goes, and the protesters grow stronger and deeper in number,” he said… Mr. Rendell urged drilling firms to publicly support a tax on natural gas extraction and to write to Mr. Corbett indicating their support. Mr. Corbett has signed a pledge not to raise taxes during his term, specifically opposing the severance tax that Mr. Rendell twice failed to enact…However, some drillers, particularly the larger firms active in the commonwealth, have said they would support a tax or fee on their development, repeating that position to reporters during interviews Wednesday…Range Resources CEO John Pinkerton said enacting a tax or fee could give the industry some certainty of its future costs, and noted that his company was the one to urge the Department of Environmental Protection to hike permit fees in order to hire more staffers.

Now I understand why Google has been investing in renewable energy, they feel guilty for using as much energy as Salt Lake City New York Times (9/8/11) reports: Google disclosed Thursday that it continuously uses enough electricity to power 200,000 homes, but it says that in doing so, it also makes the planet greener… Every time a person runs a Google search, watches a YouTube video or sends a message through Gmail, the company’s data centers full of computers use electricity. Those data centers around the world continuously draw almost 260 million watts — about a quarter of the output of a nuclear power plant…Up to now, the company has kept statistics about its energy use secret. Industry analysts speculate it was because the information was embarrassing and would also give competitors a clue to how Google runs its operations…While the electricity figures may seem large, the company asserts that the world is a greener place because people use less energy as a result of the billions of operations carried out in Google data centers. Google says people should consider things like the amount of gasoline saved when someone conducts a Google search rather than, say, drives to the library. “They look big in the small context,” Urs Hoelzle, Google’s senior vice president for technical infrastructure, said in an interview.

You mean Californians might be on the hook for the whole $65 billion disaster that is Jerry Brown’s high speed rail to nowhere?  What they need is a U.S. President who can spend money like there’s no tomorrow to help them with this ridiculous idea.  Maybe someone who needs just another 450 billion to pop start the economy . . .Los Angeles Times (9/8/11) reports: As California prepares to commit tens of billions of dollars to an ambitious high-speed rail line from San Francisco to Southern California, Congress’ political will to provide the bulk of the funding is disappearing, leaving the possibility that the state could end up stuck with a crushing financial burden…State voters have agreed to issue more than $9 billion in bonds to build the system, but that’s a fraction of the $43 billion projected tab for the initial phase. And those costs could swell to $65 billion or more, by some estimates…Should federal funds dry up after the scheduled start of construction next year, the state could be left with no more than an unfulfilled dream and some tracks in the Central Valley…”If the federal government and private investors are not going to provide funds, and California is broke, why would it take on an enormous new commitment?” asked Martin Wachs, a Rand Corp. transportation expert and former director of UC Berkeley’s Institute of Transportation Studies…In coming months, Gov. Jerry Brown will decide whether to issue the bonds to launch the project — at a time when the nation and state are attempting to control mounting public debt that has already damaged both their credit ratings…The bullet train hinges on a huge investment of federal dollars when Washington is intent on cutting the nation’s budget. Republicans who control the House of Representatives have already declared new rail construction their “lowest priority.”

Poor bastard bet the farm on Obama’s promise of green jobs and now he’s left with training in wind energy and no one is hiring American (9/8/11) reports: When Barack Obama was running for president, he promised to spend $150 billion over the next decade on renewable energy technologies, an investment that would lead to 5 million new, high-paying jobs that could never be outsourced…Once elected, Obama pushed through an economic stimulus plan that allocated $500 million to green job training efforts giving all Americans a shot at good jobs that benefit the environment…But more than two years later, these green job-training initiatives have fallen far short of the hype. Out-of-work Americans are finding that special training isn’t always enough to get a good “green” job. Or that the jobs they do qualify for have lousy pay and may last only as long as the government subsidizes them…Measuring the success of green job programs is difficult. The Labor Department has no reliable statistics on how many green jobs there are, or even a solid definition of just what a green job is. But people like Casey McDonald and his fiancée, Jade Mooneyhan, don’t need to see statistics to know that political promises do not amount to economic reality…Dashed hopes…McDonald and Mooneyhan moved from Tennessee to California so they could attend a private, wind-power technician training program. Mooneyhan planned to complete the program while McDonald took care of their then 1-year-old son, Jaeden. Once she finished training and got a job, he would start the program…The couple considered the $10,000 they saved for the trip as an investment in their future…McDonald said he’s had a lot of jobs, but the pay usually maxes out at $20 to $25 per hour…“I don’t want to be 55 and still working at $25 an hour,” he said. “We really, really wanted to secure something for us and our son, maybe in the future have a house that we can feel good about.”