Enron’s collapse bears some striking similarities to Solyndra, namely, a business model that increasingly depended on government support for profitability. When that government support didn’t come in time, Enron’s house-of-cards collapsed.
Enron was also a darling of the enviro groups, especially on global warming:
Here’s the salient point: like Solyndra, Enron was a favorite of environmentalists, and Enron was a huge backer of the Kyoto Protocol.
Then there was the crony capitalism:
Enron thought they’d make money on the trading operations from a cap and trade scheme. After Enron’s collapse, an internal memo from the late 1990s came to light that said Kyoto would “do more to promote Enron’s business than almost any other regulatory initiative outside of restructuring the energy and natural gas industries in Europe and the United States,” and concluded that Kyoto would be “good for Enron stock.”
And don't forget Enron's $150 million foray into...solar power.
Now the Washington Post reports what the $535 million loan guarantee to Solyndra will get you:
A new factory built with public money boasted a gleaming conference room with glass walls that, with the flip of a switch, turned a smoky gray to conceal the room’s occupants. Hastily purchased state-of-the-art equipment ended up being sold for pennies on the dollar, still in its plastic wrap, employees said...
It would appear that crony capitalism is highly addictive, as the same article tells us:
Solyndra’s ability to secure federal backing also made the company eager for more assistance, interviews and records show. Company executives ramped up their Washington lobbying efforts, hiring a former Senate aide to work with the White House and the Energy Department. Within a week of getting a loan guarantee commitment from the Energy Department, Solyndra applied for another, worth $400 million. It never won final approval.
A nice dose of the free market would provide the perfect rehab for all these renewable types.
No comments:
Post a Comment