The Obama administration committed more than $500 million in taxpayer money to Solyndra, a maker of solar power panels, despite repeated red flags about the company’s viability, NBC News’ Lisa Myers reported Wednesday.
The FBI raided the Silicon Valley headquarters of Solyndra last week, investigating whether the government was misled when it loaned the company $535 million in taxpayer funds. Solyndra officials say they are cooperating with the investigation.
Solyndra received the loan guarantees in 2009 as part of President Barack Obama’s promise to create millions of so-called "green" jobs. But last month, Solyndra declared bankruptcy, laying off all 1,100 workers.
“The evidence seems to be pretty clear to even the non-lawyer types that this smelled from the very get-go, that this was a really bad deal,” said Rep. Fred Upton, R-Mich., chairman of the House Energy and Commerce Committee.
A committee panel, which has been looking into the company for months, will hold a hearing Wednesday on what went wrong with Solyndra. Two company executives are expected to appear before the panel next week, The Associated Press reported.
(Update: The hearing is under way. Watch live here. Here is a link to a summary of the investigation by the Republican staff of the committee.)
House Republican investigators have unearthed emails -- reviewed by NBC -- which reveal repeated warnings by government staffers about the loan. Days before final approval there was a warning that one model showed the project would run out of cash in September 2011, which it did.
Another memo from the White House Office of Management and Budget, also cited by The Washington Post, questioned the model the government was using, but said "[g]iven the time pressure we are under to sign-off on Solyndra, we don't have time to change the model."
Why the rush? The White House appeared to be pushing to meet political deadlines so Vice President Joe Biden could announce final approval when he spoke at the groundbreaking for the new plant.
A key question is whether Solyndra's political connections were a factor. A big Obama donor associated with the venture, identified by the Post as Tulsa billionaire George Kaiser, repeatedly visited the White House. He has denied using his influence to win approval of the loan.
A White house spokesman says no political influence was involved here, that this was a worthy investment in a company many saw as promising. And, he says, just because this company failed, we can’t stop investing in new technologies critical to American leadership in a global economy.
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First published September 14 2011, 8:11 AM