Solyndra Hypocrisy: David Vitter Sought Energy Loans He Now Seeks to Scrutinize

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Washington “scandals” have a predictable rhythm, and the Solyndra solar loan “scandal” has entered the phase where critics start exploiting the controversy to push their ideological agenda. For example, Republican Senator David Vitter of Louisiana has filed a bill to increase scrutiny of taxpayer-financed renewable energy projects. It wouldn’t scrutinize taxpayer-financed non-renewable energy projects, like the nuclear reactors that Vitter so ardently supports. It wouldn’t scrutinize why a certain Louisiana Senator has worked so hard to protect oil companies from liability for their spills. It would just crack down on Big Renewables.

“We can’t afford any more crony capitalism,” Vitter said on Wednesday. Vitter should know. He’s written a bunch of letters to the Energy Department’s loan program seeking loans for renewable energy firms.

For example, on July 1, 2009, Vitter and Democratic Senator Mary Landrieu of Louisiana wrote Energy Secretary Steven Chu to support a loan application by the V Vehicle Company, a clean-car start-up (backed by T. Boone Pickens and the venture capital leviathan Kleiner Perkins) that was planning a Louisiana factory. “This vehicle would serve as a catalyst for job creation,” they wrote. A year later, Vitter joined the entire Louisiana delegation in another letter pushing “expedited consideration” for VVC. Alas, the Energy Department rejected the loan, citing concerns about the company’s financial viability. Vitter must have been annoyed by all this due diligence, because in December 2010–after VVC changed its name to Next Autoworks–he, Landrieu and Congressman Rodney Alexander tried once more. “Every day that Next Autoworks’ application is delayed is another day that workers cannot be hired,” the wrote. So far, no luck.

No wonder Vitter’s angry: His cronies are losing!

Vitter had better luck when he and Texas Republicans John Cornyn and Kay Bailey Hutchison pitched Chu on a loan guarantee for Diamond Green Fuels, a project (led by the Texas petroleum refiner Valero) to build a plant near New Orleans to convert animal fats and used cooking oils into renewable diesel. “Funding from the loan guarantee program can play an important role in its construction,” they wrote. In March, the Energy Department provided conditional approval for a $241 million loan guarantee. But Diamond later withdrew its application, saying the government process was too burdensome; in other words, once again, the feds were being too careful with taxpayer dollars. Instead, Valero plans to finance the plant itself.

Vitter also signed a Republican letter essentially complaining that the Energy Department was being too careful with loan guarantees for nuclear plants. And he wrote a letter himself supporting ADA Carbon Solutions, which landed a conditional commitment for a $245 million loan guarantee to build a clean-coal plant in Red River Parish. But that’s presumably good crony capitalism, because clean coal isn’t renewable.

Look, I get it, hypocrisy is not a crime in Washington. Vitter is free to attack the program and work the program at the same time. Republicans are free to mock Obama’s stimulus bill while attending ribbon-cuttings for stimulus projects. The leader of the Republican crusade against Solyndra, Congressman Cliff Stearns of Florida, is free to attack Obama’s push for green jobs at the same time he hails a stimulus-funded advanced battery factory in his district.

And the Solyndra loan that went bust deserves scrutiny. So far, we’ve learned that analysts in the White House Office of Management and Budget had serious doubts about the loan—which is not a big surprise, because OMB analysts are skeptical of the loan program, and fight with the Energy Department all the time. We’ve also learned that the Obama White House wanted to get the loan done quickly, just like the Bush administration had. I keep reading  that the Bush administration “rejected” the Solyndra loan, which is not true; Bush’s political appointees tried to rush the loan out the door before they left office in January 2009—which was perfectly appropriate—but a “credit committee” of career civil servants said more analysis was needed. The same committee unanimously approved the loan two months later.

Who knows? Maybe someone will come up with a smoking gun that elevates this into a true scandal. But Vitter’s push against crony capitalism is a clarifying moment in the arc of the Solyndra story.  Because it’s not about Solyndra, an innovative company whose product turned out to be too expensive at a time when solar costs were plunging. Everyone knew when the loan program was first authorized—by Bush and a GOP-controlled Congress—that some of the loans would go bad. That’s the nature of loans, especially loans designed to promote innovation.

No, the Solyndra story is about renewable energy. If we don’t want to be dependent on petro-thugs for our survival, if we don’t want to broil the plant, if we don’t want the health of our economy to hinge on the energy futures markets, we’re going to have to reduce our dependence on fossil fuels. But certain industries have a strong interest in strangling green energy in its cradle. And those interests are well represented in Louisiana.