For those who understand how a market economy works, which apparently excludes a tremendous number of Republican voters, the Solyndra attacks from Mitt Romney have never made any sense. Beyond the irrationality of the arguments there is the key point that Romney got his facts wrong in his attacks on Obama.
Some businesses are going to fail. I’ll leave it to readers to follow the above link to the fact checking. If for the sake of discussion we believe that there is any logic to Romney’s logic that it indicates a failing on the part of a public official if a company they provided assistance to should later go bankrupt, it turns out that Romney has done the same:
Romney has repeatedly ripped the Obama administration for sending federal funds to Solyndra, a California alternative energy company that went belly-up.
Decrying the White House’s decision to give Solyndra a $535 million federal loan as “crony capitalism,” Romney even held a surprise campaign stunt at the Bay Area plant Thursday.
But a day later, a Massachusetts solar panel company that received a state grant while Romney was governor filed for bankruptcy, according to the Boston Herald.
Romney personally awarded a $1.5 million renewable energy subsidy to Konarka Technologies, based in Lowell, a short time after he took office in 2003, the paper reported.
That company filed for Chapter 7 bankruptcy protection and laid off 85 workers.
The Obama campaign was quick to pounce on the apparent double-standard.
“Every day we see a new example of Mitt Romney’s hypocrisy,” said Obama spokeswoman Lis Smith. “Mitt Romney may think he can play by a different set of rules, but he can’t hide his history of giving millions of dollars in government loans to campaign donors.”
The Romney campaign did not immediately comment on the report. Konarka collected a total of $20 million in government grants during its 11-year history, according to the Herald
“It’s a powerful line of attack that connects failed ventures like Solyndra, the bankrupt California-based solar panel maker that defaulted on a $535 million loan from the U.S. Energy Department, with the trillion-dollar budget deficits and sluggish U.S. economy of the past four years.
But it might invite unfavorable comparison with Romney’s tenure as governor of Massachusetts from 2003 to 2007. During that time, Romney pursued a hands-on approach to economic development that favored some industries over others and, in some instances, singled out individual firms for special favors.
Romney, a former private equity executive, backed tax breaks for film makers and biotech and medical-device manufacturers. His administration promoted venture capital-style funds that extended loans to start-up companies, some of which subsequently went out of business.
As the state’s top salesman, he led the effort to lure desirable employers through tax breaks and other incentives.
“That’s what governors do – they have to pick winners and losers,” said Boston University professor Fred Bayles. “It’s a calculated risk that governors and state politicians take in an effort to get jobs.”
Sometimes, as with Bristol-Myers Squibb, Romney’s efforts panned out. Other times they did not.
A $2.5 million state loan helped lure Rhode Island biotech firm Spherics Inc across the state line to Massachusetts in 2005. Romney’s economic development secretary, Ranch Kimball, touted the move as “a tangible result of the combined and coordinated efforts of the public and private sectors to highlight the benefits of locating in Massachusetts.”
The company shut down three years later, laying off all of its employees and defaulting on $1.5 million of the loan, according to MassDevelopment, the state development authority.
Romney’s attacks of crony capitalism against Obama are even more absurd considering it is actually Romney, not Obama, who has a record of using government money to reward donors:
GOP presidential hopeful Mitt Romney has hammered President Obama for his administration’s tax-funded investment blunders — but when Romney was governor, the state handed out $4.5 million in loans to two firms run by his campaign donors that have since defaulted, leaving taxpayers holding the bag.
The two companies — Acusphere and Spherics Inc. — stiffed the state on nearly $2.1 million in loans provided through the state’s Emerging Technology Fund, a $25 million investment program created while Romney was governor in 2003 that benefitted 13 local firms.
Overall, the federal government has distributed over $800 billion in stimulus money. Where are the sweetheart deals? Where are the actual outrages that are provoking outrage? During the debate over the stimulus, experts warned that as much as 5% to 7% of the stimulus could be lost to fraud. But by the end of 2011, independent investigators had documented only $7.2 million in fraud, about 0.001%.