The Accountability Charade
by Michelle Malkin
You can’t spell “accountability” without “A,” “C” and “T.” But in Washington, government officials routinely get away with “taking personal responsibility” by mouthing empty words devoid of action. Heads nod in collective agreement that mistakes were made. But heads never roll. The Obama administration has raised this accountability charade to an art form.
At a House Energy Committee hearing on the half-billion-dollar bankrupt Solyndra loan-guarantee disaster, Energy Secretary Steven Chu made a grand pretense of falling on his sword. The neon-green solar energy zealot told lawmakers in prepared testimony that the “final decisions on Solyndra were mine, and I made them with the best interest of the taxpayer in mind.” But again and again, Chu admitted, those decisions were made with serial cluelessness about the political jockeying, dire financial warnings, legal red flags and conflicts of interest that “everybody (else) and their dog” knew about (as GOP Rep. Joe Barton of Texas politely pointed out).
While former Democratic chief inquisitor Henry Waxman praised Chu’s “reputation for integrity” as “unimpeachable,” Chu came across as more Mr. Magoo than Mr. Clean.
Chu said he was “unaware” of the Department of Energy’s own staff predictions two years ago that Solyndra would face a serious cash-flow crisis today.
Chu said he was “unaware” of administration pressure on Solyndra to suppress layoff announcements until after the November 2010 midterm elections. “I don’t know. I just learned about that,” he shirked.
In fact, he used the phrase “I am aware of it now” at least a half-dozen times. If there were a Nobel Prize for Unknowing, Chu would be two-time shoo-in. GOP House Energy Committee Chairman Cliff Stearns summed up:
“We talked about the August 2009 email predicting Solyndra would be out of cash in September 2011. You knew about that, but you didn’t seem to know about that.
The PricewaterhouseCoopers concerns about Solyndra, you didn’t seem real concerned or weren’t aware of it.
The White House emailing your chief of staff regarding their concerns with the PricewaterhouseCoopers report, you didn’t seem to know too much about your chief of staff’s awareness of that.
The request to hold off announcement of the DOE loan, and request by your agency to Solyndra to hold off on announcing layoffs till after the midterm election, you don’t have any recollection of this. So what I am saying is that through all of this you seem to have an unawareness.”
In short, Chu took full responsibility for everything he wasn’t aware of … until it was too late.
Sound familiar? It was the leitmotif played in last week’s Fast and Furious hearings with Attorney General Eric Holder.
Despite a raft of briefing memos with his name on them, Holder claimed he never received or read them. Rhode Island Democratic Sen. Sheldon Whitehouse ran interference, sanctimoniously explaining for all the non-career government attorneys in the audience — including the family of murdered Border Patrol Agent Brian Terry — that nooooooo one in the top echelons of the federal lawyers’ bureaucracy actually reads memos addressed to them. It’s merely a “convention” for junior staff to feel better and more important about themselves.
Taking his boss’s lead, former Holder Chief of Staff Kevin Ohlson — who is seeking a federal judicial slot — explained away his failure to do anything about the festering Fast and Furious gunwalking scandal. He had “been informed that routine courtesy copies of weekly reports were forwarded to me that referred to the operation by name, but that did not provide any operational details and did not refer to gun walking or anything similar.”
Although his name was on the documents, Ohlson just didn’t bother to read them because they weren’t marked important or sensitive. Imagine an ordinary small businessman or taxpayer trying that one out on the IRS.
Situational unawareness in the private marketplace or on the battlefield will cost you your livelihood or your life. In the Age of Obama, however, such willful ignorance is a job prerequisite. The less you know the better.
The Energy Department approved in February a refinancing that put taxpayer debt behind $75 million in new funding from private investors in a last-ditch effort to rescue Solyndra. Republicans said the agreement violated a 2005 energy law prohibiting subordination of public money.
Representative Steve Scalise, a Louisiana Republican, asked who would be paid first as money is recouped from the sale of Solyndra’s assets.
“Does the taxpayer have first dibs?” Scalise said.
“After restructuring? No,” Chu responded.
Chu said the restructuring gave Solyndra a “fighting chance to survive.”
“It was a difficult decision, and we were always, always focused on that path that could get as much taxpayer recovery as possible,” he said.
Chu said his department’s general counsel determined that the law banned subordinating taxpayer debt only for an initial loan guarantee, not for a refinancing. Scalise predicted the Solyndra subordination will be found illegal.
From GOP Rep. Cliff Stearns:
“The American people have the right to know how the Obama Administration risked and lost $535 million in taxpayer funds,” said Rep. Cliff Stearns (R-FL), Chairman of the House Energy and Commerce Committee’s Subcommittee on Oversight and Investigations. “This hearing shows that Secretary Chu failed to require appropriate oversight over the loan guarantee process, is unaware of the financial condition of the other loan guarantee recipients after two of the first three have filed for bankruptcy, did not seek legal input from the Department of Justice before subordinating taxpayers to two hedge funds, and is unable to identify who at DOE asked Solyndra to withhold announcing impending layoffs until after the November 2, 2010 elections. The appointment of Herb Allison to review all of the loan guarantees indicates that the President has lost faith in Secretary Chu. I agree with the point of Dan Carol, an Obama campaign senior advisor, who called on the White House to replace Chu earlier this year in an email. Chu has failed the test, and in my personal opinion I agree with Mr. Carol that he should be replaced by the President.”
Stearns referred to an August 2009 email by a DOE staff member stating that Solyndra’s financial model showed it running out of cash in September 2011, just when the firm filed for bankruptcy. Chu responded, “I wasn’t aware of this particular email at the time.”
Regarding the failure of Solyndra and Beacon Power, Stearns asked Chu, “When you have two of the first three loans out of the 1705 program go bankrupt, the question for you is how many loan guarantees that you are involved with and covering and monitoring are going to fail, in your opinion?” Chu was unable to provide an answer. He also was unable to even cite loan guarantees that were at high risk.
Although the Obama Administration claims that politics played no role in Solyndra, advisors for Argonaut, Solyndra’s largest investor, discussed with DOE impending layoffs at Solyndra. The email states that DOE “did push very hard for us to hold our announcement of the consolidation to employees and vendors to Nov 3rd – oddly they didn’t give a reason for that date.” The mid-term elections were held the previous day. Chu could not say who at DOE made that request.
Stearns added that the investigation continues, “The White House has continued to stonewall this investigation at every turn, forcing this Committee to issue a subpoena to obtain basic investigative documents. And yet, the White House has still only produced a few selective documents form the West Wing of the White House to the Committee, some of which were heavily redacted, despite the White House Counsel’s office having admitted that this is a legitimate investigation.”
A Chu fact-check from…WaPo on his jobs claims and solar prices:
We always warn readers to be wary of claims about the number of jobs created by some government, congressional or corporate initiative. These are almost always suspect and based on dubious assumptions. (Chu, we should note, carefully used the word “employ” instead of “create.”)
As it happens, Carol D. Leonnig and Steven Mufson of The Washington Post examined the job-claim figure two months ago and found it wanting. “The program — designed to jump-start the nation’s clean technology industry by giving energy companies access to low-cost, government-backed loans — has directly created 3,545 new, permanent jobs after giving out almost half the allocated amount, according to Energy Department tallies,” they reported on The Post’s front page.
The Energy Department disputed that analysis as “incomplete and inaccurate,” as evidenced by the fact that Chu repeated the claim in sworn testimony before Congress. But if you dig deeper into the 60,000 number, you find that more than half of it comes from a single program — 33,000 jobs at Ford that were supposedly converted to green technology because of a $5.9 billion loan. The Energy Department translated those as “saved” jobs, even though the number amounts to nearly half of Ford’s total workforce.
It’s one of the oldest tricks in the Washington spin book: Lump a bunch of tiny projects with one big project, and then claim all of them — 38 in this case — created a bunch of jobs.
… Chu’s other quote — concerning the unexpected collapse in solar prices — is also open to question. Chu rightly noted that there were some analysts — “outliers,” as he put it — who might have predicted a huge plunge in the solar module market. But he contended that most did not predict prices would drop below $2.
At the same time, however, the shakiness in the market was readily apparent at the time DOE pressed the White House budget office to sign off on the Solyndra loan. Note the Aug. 31, 2009 e-mail below, from an Office of Management and Budget official to a DOE official, asking that an announcement of the loan be postponed.
The e-mail includes links to articles with headlines like “As Prices Slump, Solar Industry Suffers.”
…While Chu said that Wall Street analysts generally were not predicting such a steep price drop, it is clear from the articles mentioned in the e-mail that they were warning that prices would fall further. The Fact Checker once covered Wall Street, and analysts promoting stocks are almost always bullish. When analysts start getting skittish, it’s time to get wary. In fact, one of the articles cited in the e-mail reported that a major investment firm had downgraded the solar energy sector from “positive” to “neutral.”
On Wall Street, that usually translates as “sell.”
“Nothing in the e-mail you cited or the stories it mentions predicted the prices would fall as far as they did,” DOE spokesman LaVera said.
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