That Barack Obama sure can pick 'em.
"The true engine of economic growth will always be companies like Solyndra," the president said in May 2010.
A little more than a year later, the Fremont, Calif.,-based solar manufacturer has cancelled plans for an initial public stock offering, laid-off 1,100 employees, suspended operations, dumped its founding chief executive officer, filed Chapter 11 bankruptcy, and opened its doors to Republican-led Congressional investigators and Federal Bureau of Investigation officers.
Investigators want to know what it did with the $535 million in loan guarantees it received from the Department of Energy under the last big government stimulus program that failed to stimulate.
"This investment is part of President Obama's aggressive strategy to put Americans back to work and reduce our dependence on foreign oil," Energy Secretary Steven Chu said in a March 2009 press release, announcing the loan guarantee. "We can create millions of new, good-paying jobs that can't be outsourced."
Solyndra's founder and ex-CEO Christian Gronet said: "This expansion is really about...meaningfully impacting global warming."
Solyndra isn't the only American solar company in financial trouble these days. Evergreen Solar of Massachusetts and SpectraWatt of New York also filed recent bankruptcies. And BP Solar stopped manufacturing in Frederick, Md., last spring.
As usual, it turns out China is the low-cost leader. The Chinese government has poured many more billions than the U.S. government into solar. As a result, the cost of solar technology has fallen faster than companies like Solyndra can put up manufacturing plants.
This perhaps inevitable turn of events couldn't have come at a worse time for Obama as he releases a new jobs plan after two years of 9%-plus unemployment and zero job creation in August.
Before he publicly hyped this unproven start-up company as a shining example of America's future, perhaps Obama should have read Solyndra's IPO registration statement, particularly the part about the competition. Or maybe he should have taken note of the independent auditors who said the company was piling up losses and blowing through cash so fast it just might not make it.
It also doesn't help the president that one of Solyndra's big investors was the foundation of Tulsa, Okla., billionaire George Kaiser, who is also one of his leading fund raisers. Kaiser, a frequent White House visitor, has said he wasn't involved in the loan guarantee discussions. But you know where this is going to go in a heated election cycle.
Solyndra built solar collectors from cylinders, about the size of fluorescent light tubes, that can catch the sun from any angle and work well on flat rooftops. Gronet threw around the numbers like a throw-back from the dot-com era.
"There's a vast under-utilized resource for generating solar power and it's right over our heads," Gronet told the Oakland Tribune in 2008. "There's over 30 billion square feet of large, flat commercial rooftop space (in the United States). If we covered that with our solar panels, that would generate 150 gigawatts, enough electricity to generate power for 15% of U.S. homes."
Hey, earth gets all of its energy from sunlight, but that never meant Solyndra was going to be the one to bottle and sell it. Looks like Silicon Valley has struck again.
This time it's taxpayer's money. And the band plays on.
Last week, the Energy Department announced a partial guarantee of a $344 million loan for the SolarStrong Project. Another California-based company, SolarCity Corp., will install up to 160,000 rooftop solar systems on private military family residences.
"This is the largest domestic residential rooftop solar project in history," Chu said. "This groundbreaking project is expected to create hundreds of jobs for Americans."
Or maybe, for bankruptcy lawyers.
(Al's Emporium, written by Dow Jones Newswires columnist Al Lewis, offers commentary and analysis on a wide range of business subjects through an unconventional perspective. Contact Al at firstname.lastname@example.org or tellittoal.com)