Fisker fiasco in the making
Solyndra is a solar scandal -- a Green Scheme gone bad that will cost taxpayers over one-half billion dollars. But these government backed deals are like cockroaches: when you see one, others are likely to follow.
Sure enough, on cue we have one more popping up on radar screens. This would be Fisker Automotive, a brand-new car company that is trying to build an electric vehicle. The company's investors include AL Gore and a raft of Democratic donors. The taxpayers are on the hook for another one-half billion dollars if (or when) this car company goes belly-up. On the other hand, if it succeeds, the private investors can make many millions of dollars. Heads: taxpayers lose; tails: the Democrats win.
The latest news from the start-up is that the "if" --as in in "if it succeeds" -- should be italicized. Fisker looks like a fiasco in the making: a modern-day Edsel with the losers this time including American taxpayers.
Carol Leonnig and Joe Stephens report in the Washington Post about the failures that have marred Fisker's founding:
An electric car company backed by more than a half-billion dollars in Department of Energy loan guarantees has missed early manufacturing goals and has gradually pushed back plans for U.S. production and the creation of thousands of jobs.
This week, Fisker delayed until 2013 the production of the moderately priced family car it plans to build in Delaware. It also learned that its Finnish-produced luxury model, the $96,000 Karma, which is two years late in reaching U.S. markets, failed to meet a promised energy-efficiency standard...
Fisker was among the big winners in the administration's effort for broader development of electric vehicles, and company officials said their problems bear no resemblance to those of Solyndra, which filed for bankruptcy protection in September.
"Without any excuses, yes, we did have some delays," company co-founder Henrik Fisker said during a stop in the District this week to show off his company's sleek new Karma. "But this is completely different. You can't compare at all."
Mr. Fisker may not want to compare the two situations but others should.
Fisker Automotive is also getting the special breaks that Solyndra received from friends in the Obama administration before it went bankrupt, taking our money with it as it went down the drain.
The Energy Department confirmed this week that it has eased expectations after conditionally approving the loan to Fisker and has made allowances for scaling back projections in the final loan agreement. But the agency declined to make public those adjusted terms, including projected car sales volume or milestones the company must meet in connection with its $529 million loan. Agency officials attributed Fisker's delays to regulatory hurdles and issues beyond the company's control.
More stonewalling from the administration that during its first day in office pledged unprecedented openness and transparency. Barack Obama, circa January 2009:
"For a long time now, there's been too much secrecy in this city," he declared. "The old rules said that if there was a defensible argument for not disclosing something to the American people, then it should not be disclosed. That era is now over. Starting today, . . . this administration stands on the side not of those who seek to withhold information but those who seek to make it known."
Perhaps the curtains are closed when Democratic donors are involved -- as compared to, say, CIA employees who interrogated suspected terrorists during the Bush years. Another point of comparison that Fisker may not like is that the administration has also been stonewalling when it comes to revealing the Solyndra story.
Here is one more comparison Fisker might not enjoy.
Democratic donors invested not just in politicians but also in Fisker:
The Fisker commitment was questioned by some from the start, partly because of the company's political connections. A key investor is a venture capital firm, Kleiner Perkins Caufield & Byers, whose partners include former Democratic vice president Al Gore. The investment house raised $2 million for Obama's 2008 presidential campaign
Hmmm..those comparisons just keep mounting.
The Secretary of Energy, Steven Chu, was also ebullient about the future for Fisker -- just as he was for Solyndra.
This is a car wreck that we are witnessing in slow motion. There is a long delay in producing the cars in America -- at a plant in Joe Biden's home state of Delaware (most new car factories are opening in right-to work states that are usually Republican redoubts -- but not this "Bridge to Nowhere"-like boondoggle. The car that it aims to produce has failed its efficiency pledge to travel solely on electricity for a 50 mile stretch.
More failures will follow. Actually, Mr. Fisker, one can and should compare the Solyndra Scandal to the Fisker Fiasco.
Skeptics might question why taxpayers are extending loan guarantees to companies backed by private investors. These loan guarantees benefit private investors -- interest rates on loans are lower and it provides a level of comfort and security that makes these investments more likely to pay off for Democrats like Al Gore and the folks at Kleiner Perkins (and the Qatari government that also invested). At the same time, taxpayers own 500 million shares of General Motors that are the result of Obama auto bailout. GM is also producing an electric car, the Volt.
Why should taxpayer subsidize competitors to GM? This hurts their ability to recoup the investment they have in car and a company that will compete with Fisker. There has been criticism regarding the viability of these ObamaCars, but little or no commentary regarding how taxpayers suffer twice: we are guaranteeing loans that will probably fail. At the same time Obama is helping a competitor to GM-hurting the prospects that taxpayer-investors in GM will profit from their ownership in GM.
The Obama modus operandi towards American taxpayers: take money from them and then transfer it to Democratic donors and supporters.